If the expected value of a cash flow is $1,800 and the standard deviation is $200, what does this tell us?
Would a cash flow with an expected value of $2,500 and a standard deviation of $850 be more or less risky than the cash flow in 3a?
What is the range of possible values within 2 standard deviations of the expected values of cash flows a. and b.?
What percent of possible values fall within this range?