Q.

Which of the following does not obey the mean-variance rule?

A. Project X will be preferred to project Y if the standard deviation on X and Y is the same, but the expected return on Y is lower.
B. Project X will be preferred to project Y if the expected return on X exceeds that of Y and the variance is equal to or less than that of Y.
C. Project X will be preferred to project Y if the expected return on X and Y is the same, but Y has a higher standard deviation.
D. Project X will be preferred to project Y if the variance of X is higher than Y and the expected return is lower than Y.
Answer» D. Project X will be preferred to project Y if the variance of X is higher than Y and the expected return is lower than Y.
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