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If the Standard Deviation of Returns from an Investment Is

Question 16

Multiple Choice

If the standard deviation of returns from an investment is zero, then:


A) the risk associated with the investment is more than that of the investments that provide risk-free return.
B) the expected return from the investment is higher than that of those investments whose standard deviation is greater than zero.
C) the scatter of the possible outcome from the investment is high and its investors demand higher return.
D) the scatter of the possible outcome from the investment is low and its investors demand higher return.
E) there is no risk associated with the investment; that is, the investment is risk free, because there is only one possible payoff.

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