Which of the Following Is the Correct Ranking from Least

question 15

Multiple Choice

Which of the following is the correct ranking from least risky to most risky?

• A) Long-term Treasury bonds, stocks, Treasury bills
• B) Treasury bills, long-term Treasury bonds, stocks
• C) Stocks, long-term Treasury bond, Treasury bills
• D) Stocks, Treasury bills, long-term Treasury bonds

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Definitions:

Corrective Tax

A tax designed to induce private decision makers to take into account the social costs that arise from a negative externality.

Externality

A side effect or consequence of an industrial or commercial activity that affects other parties without this being reflected in market prices.

National Defense

Governmental and military actions and policies aimed at protecting a country from external aggression, threats, and maintaining national security.

Patented Invention

A unique product or process that has been legally protected by a patent to give its inventor exclusive rights to use, make, or sell it for a certain period of time.