Nosari’s Noodle Factory Two Projects: Evaluate Risk
November 16th, 2022
Nosari’s Noodle Factory has two projects: Gina’s Gemelli and Fran’s Farfalle.
Gina’s has an expected NPV of $1,000. The standard deviation of the NPV is $400.
Fran’s Farfalle has a expected NPV of $1800. The standard deviation of the NPV is $600.
Which project is relatively more risky?
(All amounts are in millions of dollars)
C) The projects are equally risky on the basis of risk per unit of return