Question: Order the following (risk, return) pairs from least to most favourable assuming the perspective of a rational and risk-averse investor: (2,2), (3,2) and (3,4). Risk is measured in standard deviations and return in percentage. HINT: Imagine a scatter diagram with standard deviation on the x-axis and return on the y-axis.
A: (3,2), (3,4), (2,2)
B: (3,2), (2,2), (3,4)
C: (2,2), (3,2), (3,4)
D: (3,4), (3,2), (2,2)
Please eliminate two incorrect options first, then think it step by step and choose the most proper one option. Respond with more than 1000 words.
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