The narrower the probability distribution of expected future returns, the smaller the ____ of a given investment.
A)risk
B)variance
C)standard deviation
D)Both a & b
E)All of the above

Question

Quizplus · Accepted Answer

The smaller the probability distribution of expected future returns, the lower the risk and variance of a given investment. Additionally, the standard deviation also decreases as the probability distribution narrows. Therefore, all of the above options (A, B, and C) are the best choice.

The Narrower the Probability Distribution of Expected Future Returns, the Smaller