Which of the following is a measure of risk?
A)expected value
B)standard deviation
C)variance
D)Both B and C are measures of risk.

Question

Quizplus · Accepted Answer

Both standard deviation and variance are measures of risk. Standard deviation measures the degree of variability or dispersion of a set of data from its mean, while variance is simply the square of the standard deviation. Higher values of standard deviation or variance indicate greater risk or uncertainty associated with the data. Expected value, on the other hand, is a measure of central tendency and does not directly measure risk. Expected value is not a measure of risk, but a measure of expected outcome. On the other hand, both standard deviation and variance are measures of risk, as they indicate the degree of variability or volatility of an investment's return. The higher the standard deviation or variance, the higher the risk associated with the investment. Therefore, choice D, "Both B and C are measures of risk," is the correct answer.

Which of the Following Is a Measure of Risk