QUESTION Which of the following is correctly describes the concept risk structure of interest rates Risk structure refers to the amount of additional interest necessary to compensate savers for the greater risk of default on some bonds. Risk structure reefers to the relationship among the interest rates on similar bonds with different maturities. Risk structure refers to the relationship among the interest rates on bonds with the same maturity. Risk structure refers to amount of additional yield necessary to compensate savers for the lesser liquidity of some bonds. QUESTION 2 Alice and John have each invested in bonds that have the same maturity period but with different interest rates. Which of the following explains the cause for the difference in the interest rates? Interest rates may vary due to liquidity Interest rates may vary due to information costs and costs from taxation Interest rates may vary due to risk. All of the above. QUESTION 3 Suppose that you work for an investment firm and your task is to identify and invest in default-risk-free financial assets (instruments). Which of the following instruments would you choose to invest? a three-month commercial paper issued by GE a share of stock issued by Google a U.S. Treasury bonds a ten-year bond issued by Intel