1. The sources of total return on a coupon-paying bond are

A. principle repayment, coupon retirement, and call provision

B. coupon payments, price change and call provision.

C. price change, coupon retirement and principle repayment.

D. coupon payments, reinvestment of coupon payments, and principle repayment.

2. Risk aversion arises only among investors who

A. invest in equities

B. have diminishing marginal utility of wealth

C. invest for long periods of time

D. hold portfolios concentrated in specific industrie

3. What are the annual return and average quarterly return on an investment if its quarterly returns are 3%, 5%, 4%, and 7%, respectively?

A. 19.00%; 4.72% B. 21.92%; 4.73% C. 20.33%; 4.74% D. 24.54%; 4.75%