Which of the following is the correct order of corporate issues based on risk and return? (From most risk-return to least risk-return.)
A) Common stock, subordinated debentures, secured debt, Treasury bills
B) Preferred stock, common stock, subordinated debentures, secured debt
C) Common stock, long-term government bonds, secured debt, subordinated debt
D) Common stock, secured debt, subordinated debentures, preferred stock

Question

Quizplus · Accepted Answer

Common stock carries the highest risk but also the potential for the highest return, followed by subordinated debentures, secured debt, and Treasury bills which have the lowest risk but also the lowest return.

Which of the Following Is the Correct Order of Corporate