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. Based on the graph, which of the following statements is true? The 1-year bond has more interest rate risk. Both bonds have equal interest rate risk. The 10-year bond has more interest rate risk. Neither bond has any interest rate risk. An investor is concerned that a decline in interest rates might lead to less annual income from her investments. If interest rates increase, the value of earnings from her investments will increase. If her goal is to save for retirement, which of the following bonds poses the biggest risk? Answer the following question based on your understanding of interest rate risk and reinvestment rate risk. True or False: Assuming all else is equal, the shorter a bond's maturity, the more its price changes in response to a given change in interest rates