Why Are Bonds Less Risky Than Stocks

question 58

Multiple Choice

Why are bonds less risky than stocks?

• A)Dividend given on shares are usually less than the coupon-rate on bonds.
• B)Bonds can be issued only by the government whereas shares are issued by private firms.
• C)Bondholders have a claim on the assets of the firm whereas the shareholders do not.
• D)Shareholders are entitled to a share of company's earnings.
• E)The higher the profit of the firm,the greater the share of the bondholders.