SIE Exam Question 439: Answer and Explanation

Question: 439

In the event of a corporate liquidation, which of the following has the highest priority to corporate assets?

  • A. Callable Preferred Stock
  • B. Convertible Bonds
  • C. Unsecured Debt
  • D. Secured Debt

Correct Answer: D

Explanation:

D: Secured debt has priority over unsecured debt. Unsecured debt includes bonds. Lastly is the stock - with common stock being the last on the food chain.

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