1. For each of the following pairs, which bond would you expect to pay a higher interest...

Question:

1. For each of the following pairs, which bond would you expect to pay a higher interest rate? Explain.

a. a bond of the Canadian government or a bond of an East European government

b. a bond that repays the principal in year 2015 or a bond that repays the principal in year 2025

c. a bond from Coca-Cola or a bond from a software company you run in your garage

d. a bond issued by the federal government or a bond issued by Prince Edward Island

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