1. Jackson and Juliette have each achieved an arithmetic average annual rate of return on their investments of 6% over the last 5 years. The standard deviation of Juliette's returns was 10%; Jackson's was 25%. Which of the following is true?

a) Juliette's 5 year holding period rate of return is higher than Jackson's.

b) Jackson's 5 year holding period rate of return is higher than Juliette's.

c) Their 5 year holding period rates of return are equal.

d) Their geometric average rates of return are equal.

2. A company issues a 10 year, callable bond at par with 8% annual coupon payments. The bond can be called in four years, or any time after that, on a coupon payment date. The call price is $105 per $100 of face value. Which is closest to the yield to call?

A. 9.09%

B. 9.25%

C. 9.88%

D. 12.00%