Rank the Following in Order of Priority in the Event

question 49

Multiple Choice

Rank the following in order of priority in the event of bankruptcy:
I.Subordinated, secured debt
II.Subordinated, unsecured debt
III.Unsubordinated, secured debt
IV.Unsubordinated, unsecured debt

• A)III, I, IV, II
• B)IV, I, III, II
• C)III, IV, I, II
• D)IV, II, III, I

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Definitions:

Mutual Mistake

A situation in contract law where all parties involved have a shared erroneous belief concerning a basic assumption on which the contract was made.

Unilateral Mistake

A situation where only one party to a contract is mistaken about a fundamental fact or term of the contract.

Equity

The value of an ownership interest in property, including shareholders' equity in a corporation or owners' equity in property, or fairness and justice as applied in the legal system.

Unilateral Mistake

A contract law principle where an error made by one party does not affect their understanding of key terms or obligations, affecting the contract's enforceability.