The absolute priority rule is the principle that guarantees the seniority of equity holders to junior creditors.

Name: The absolute priority rule is the principle that guarantees the seniority of equity holders to junior creditors.
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The absolute priority rule actually prioritizes the claims of senior creditors over those of equity holders (shareholders) in a bankruptcy scenario, ensuring that senior creditors are paid before equity holders receive anything.

The Absolute Priority Rule Is the Principle That Guarantees the Seniority