The risk encountered by an investor when holding debt is greater than the risk from holding common stock.

Name: The risk encountered by an investor when holding debt is greater than the risk from holding common stock.
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Holding common stock typically involves greater risk than holding debt instruments (like bonds) because stockholders are last in line to be paid in case of a company's liquidation, whereas bondholders, as creditors, have priority over stockholders in receiving payments.

The Risk Encountered by an Investor When Holding Debt Is