Question: Which one below is not correct about bonds and stocks? Bonds are liability and stocks are equity of the firm Bondholders will be first repaid

Which one below is not correct about bonds and stocks? Bonds are liability and stocks are equity of the firm Bondholders will be first repaid if the firm faces bankruptcy It is always good for firms to have a higher D/E ratio because of the tax shield benefits An all-equity firm will not face bankruptcy problem None of the above

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