A firm is considering two alternative projects. Project A needs an investment of $800,000. Project B needs an investment of $750,000. Relevant annual cash flow data for the two projects over their expected seven-year lives are as follows:
PROJECT A PROJECT B
probability: cash flow: probability: cash flow:
0.50 $0 0.045 $0
0.50 $500,000 0.910 $200,000
0.045 $400,000
Calculate the expected value, standard deviation, and coefficient of variation of cash flows for each project