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multiple choice question The distinction between senior and subordinated debt is associated with A - general...

multiple choice question

The distinction between senior and subordinated debt is associated with

A - general debenture bonds
B - mortgage bonds
C - collateral trust bonds
D - Commercial bonds
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Answer #1

Your required answer is option C i.e. Collateral Trust Bonds.

Explanation:

When a company files bankcruptcy then the senior debt which mostly bank and bond holders they ask their money first and they have more chance of getting money back. Therefore the distinction between senior and subordinated debts is associated with collateral trust bonds.

I hope this clear your doubt.

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