Consider the following statements : Statement I : As regards returns from an investment in a company, generally, bondholders are considered to be relatively at

Question

Consider the following statements :
Statement I : As regards returns from an investment in a company, generally, bondholders are considered to be relatively at lower risk than stockholders.
Statement II : Bondholders are lenders to a company whereas stockholders are its owners.
Statement III : For repayment purpose, bondholders are prioritized over stockholders by a company.

Which one of the following is correct in respect of the above statements ?

Accepted Answer

(A) Both Statement II and Statement III are correct and both of them explain Statement I

Answer

(B) Both Statement I and Statement II are correct and Statement I explains Statement II

Answer

(C) Only one of the Statements II and III is correct and that explains Statement I

Answer

(D) Neither Statement II nor Statement III is correct