McEnro wishes to decide between two projects, X and Y. By using probability estimates, he has determined the following statistics
|
Project X ($)
|
Project Y ($)
|
|
Expected NPV
|
35,000
|
20,000
|
|
22,000
|
20,000
|
(a) Compute the coefficient of variation for each project, and (b) explain why and the coefficient of variation give different rankings of risk. Which method is better?