1. Suppose you invest $1,000 today in an account that pays 3% interest, compounded annually. The balance in the account at the end of ten years, if you make no withdrawals, is closest to:
a- $1,000
b- $1,344
c- $1,300
d- $744
2. The sensitivity of bond prices to changes in interest rates is:
a- inflation risk.
b- interest rate risk.
c- credit risk.
d- default risk.