1. For each of the following pairs, which bond would you expect to pay a higher interest rate? Explain. (Think about the relationship between credit risk and return).
   1. A bond of the U.S. government or a bond of an East European government
   2. A bond that repays the principal in year 2015 or a bond that repays the principal in year 2040
   3. A bond from Coca-Cola or a bond from a software company you run in your garage
   4. A bond issued by the federal government or a bond issued by New York State