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  3. u = e(r) (a/2)s2, where a = 4.0. use the below inf

U = E(r) (A/2)s2, where A = 4.0. Use the below information to answer the...

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Finance

U = E(r) (A/2)s2, where A = 4.0.

Use the below information to answer the following question.

Investment Expected Return E(r) Standard Deviation
1 0.12 0.13
2 0.15 0.15
3 0.21 0.16
4 0.24 0.21

a) Based on the utility function above, which investment would you select

b)Which investment would you select if you were risk neutral

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