32.You have the option to purchase two bonds with the same maturity date, annual coupon rate, credit rating and price. The only difference is Bond ABC compounds monthly and Bond XYZ compounds quarterly. Which bond is a better deal for you as an investor?

a. They are the same.

b. Bond XYZ

c. Bond ABC

d. Not enough information to decide.

33.Which statement is true regarding investment returns and their level of risk?

a. Higher risk investments always provided higher levels of return.

b. Higher risk investments may provide lower actual levels of return.

c. Investors should invest in risky assets only when they guarantee higher returns.

d. Investors should refuse to invest in riskless assets because they always provide lower levels of return.

34.During periods of profitability, an investor in a company's debt should expect a __________ return than what an investor in the same company's equity receives. That same debt investor should expect a __________ return than an equity holder if the company is forced into bankruptcy.

a. higher | lower

b. higher | higher

c. lower | lower

d. lower | higher