Compute the reward to risk ratio for project


Your company is thinking of two mutually exclusive projects A and B. Expected return and standard deviation of project is A 20% and 15%, respectively. Expected return and standard deviation of project B is 25% and 20%, respectively. Risk-free rate is 8%.

a) Determine the reward to risk ratio for project A?

b) Compute the reward to risk ratio for project B?

c) Which project do you favour and why?

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Project Management: Compute the reward to risk ratio for project
Reference No:- TGS032547

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