Consider four different financial products you can invest in:

1. A 12-month certificate of deposit that earns 2% annual interest.

2. A par 1-year risk-free bond with a 2% annual coupon.

3. A par 1-year risky bond with a 3.5% annual coupon.

4. A $100 per share value stock that typically pays a 24% dividend annually.

Q1. Which of these is likely to be the most volatile? State at least 2 reasons WHY you selected one or more securities OR why you did NOT select the other one/ones.

Q2. Which of these (1 or 2 total) do you think has the lowest expected return? State at least 2 reasons WHY you selected one or more securities OR why you did NOT select the other one/ones.