Final answer:
Without specific fund data, stock funds with a 23.9% expected return likely have a higher standard deviation (17%), reflective of their risk, whereas bond funds with the same expected return would have a lower standard deviation (14%), indicative of their lower volatility.
Step-by-step explanation:
To establish the expected return and standard deviation for the stock fund (s) and bond fund (b), we can refer to historical trends and the nature of different types of investments. Stocks are generally expected to have higher returns due to their higher risk. Bonds, while also subject to risk such as interest rate fluctuations, tend to have lower volatility than stocks. Therefore, without specific information on the actual funds in question, it would be reasonable to assume that the option indicating the stock fund has an expected return of 23.9% with a higher standard deviation (17%) reflects the characteristics of a typical stock fund given its higher risk profile when compared to bonds. Conversely, the bond fund would likely have a lower standard deviation, suggesting that option 3, with a standard deviation of 14%, could be correct for the bond fund when expecting an equivalent return of 23.9%. However, keep in mind these figures should be verified against the specific funds in question for accurate information.
When evaluating which investment is safer or riskier, a savings account would typically be considered the safest due to minimal value change over time. Stocks would be considered the riskiest due to their large potential for growth or decline. Consequently, stocks also tend to have the highest expected return, on average, as a compensation for their higher risk profile.