The correct answer is: B. lower risk
A tighter probability distribution shows a lower risk because the possible outcomes are more concentrated around the mean. This means that there is less uncertainty about the outcome, and therefore less risk.
A wider probability distribution shows a higher risk because the possible outcomes are more spread out. This means that there is more uncertainty about the outcome, and therefore more risk.
The expected risk is the average of the possible outcomes, weighted by their probabilities. It is a measure of the central tendency of the probability distribution. The expected risk is not affected by the tightness of the probability distribution.
A peaked probability distribution shows that the most likely outcome is the mean. This means that there is less uncertainty about the outcome, and therefore less risk.
In conclusion, a tighter probability distribution shows a lower risk because the possible outcomes are more concentrated around the mean.