Which of the Following Securities Has the Highest Priority with Regard

question 22

Multiple Choice

Which of the following securities has the highest priority with regard to the distribution of both earnings and proceeds from the liquidation of assets of a firm?

• A)Corporate bonds
• B)Preferred stock
• C)Common stock
• D)American depository receipts (ADRs)
• E)Foreign stocks

---

Definitions:

Production Possibility Frontier

A graph that shows all the highest possible production levels for two products, based on available resources and technological capabilities.

Increasing Opportunity Costs

The concept that the cost of forgoing the next best alternative increases as resources become more specialized in production.

Guns And Butter

A term used to describe a country's decision to allocate its resources between defense and civilian goods.

Production Possibility Frontier

A curve depicting all maximum output possibilities for two or more goods given a set of inputs.