Question
In general, shareholders prefer _________ than bondholders do.
a. safer projects
b. riskier projects
c. more government regulation
d. higher CEO pay lower CEO pay
a. safer projects
b. riskier projects
c. more government regulation
d. higher CEO pay lower CEO pay
Answers
GPT-4o mini
Shareholders generally prefer **b. riskier projects** than bondholders do. This is because shareholders benefit from the upside potential of riskier projects, while bondholders typically prefer safer investments that ensure they receive their fixed interest payments and principal repayment.