QUESTION 5 Which one of the assertions about statement 1 and statement 2 is most likely to be true? Statement 1: Yesterday, the amount of trading activity on the stock market involving preferred stock was greater than the amount of trading activity on the stock market involving common stock. Statement 2: if XYZ has issued preferred stock. common stock, and bonds, then the preferred stock of XYZ is most likely to be the riskiest of the securities issued by the company. Statement 1 is true and statement 2 is true Statement 1 is true and statement 2 is false Statement 1 is false and statement 2 is true Statement 1 is false and statement 2 is false QUESTION 6 XYZ owns investment A and 1 bond B. The total value of his holdings is $2,600. Bond B has a coupon rate of 12.60 percent, par value of $1000, YTM of 8.20 percent. 8 years until maturity, and semi-annual coupons with the next coupon due in 6 months. Investment A has an expected return of X and is expected to pay $253 per year for a finite number of years such that its first annual payment is expected later today and its last annual payment is expected in 7 years from today. What is X, the expected return for investment A? 13.77% (plus or minus 0.02 percentage points) 16.699 (plus or minus 0.02 percentage points) 7.38% (plus or minus 0.02 percentage points) 7.55% (plus or minus 0.02 percentage points) None of the above is within 0.02 percentage points of the correct