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5 July, 09:25

Which one of the following accurately orders the rate of return on financial securities from highest to lowest over most of recorded market history (the 1928-2016 period) ? Short-term government bills, long-term corporate bonds, long-term government bonds, common stocks Long-term corporate bonds, long-term government bonds, common stocks, short-term government bills Common stocks, long-term government bonds, long-term corporate bonds, short-term government bills Common stocks, long-term corporate bonds, long-term government bonds, short-term government bills Long-term corporate bonds, common stocks, short-term government bills, long-term government bonds None of the options are correct.

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  1. 5 July, 09:34
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    Common stocks, long-term corporate bonds, long-term government bonds, short-term government bills.

    Explanation:

    Common stock is a security that represents ownership in a corporation. Owners of common stock have voting rights in electing members of board of directors. Although it's returns vary considerably, it has been observed to offer the highest returns.

    Long term corporate bonds are bonds created by a corporation to raise finance for a particular project. It offers high returns in comparison to other investments option.

    Long term government bonds unlike the corporate bonds, their returns is a little bit lower because they are more secured.

    Short term government bills also known as treasury bills. This is the most liquid securities traded on the market backed by the government and as such have low returns. They are sold at a discount and redeemed at par value.
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