1st blank options = decrease, increase

2nd blank options = less, more

5. Risks of investing in bonds A security with higher risk will have a higher expected return. A bond's risk level is reflected in its yield, but understanding the different risks involved when investing in bonds is important. The curves on the following graph show the prices of two 10% annual coupon bonds at various interest rates. BOND VALUE() $ 1 10-Year Bond INTEREST RATE (9) Based on the graph which of the following statements is true? Both bonds have equal interest rate risk. ether bond has an interest rate risk The year bond has more interest rate risk The 10-year bond has more interest rate risk Rina Durand retiring soon. so she is concerned about her investments providing her steady income every year she aware that interest rates the potential earnings power of the cash flow from her investments will increase. In particulat she concerned that a decline in interest rates might lead to annual income from her investments. What kind of risk is in most concerned about protecting against o nainvestment rate risk Interest rate risk