In the case of corporate bankruptcy, common stock's residual claim becomes especially valuable.

Name: In the case of corporate bankruptcy, common stock's residual claim becomes especially valuable.
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In the case of corporate bankruptcy, common stock is typically the last to receive any remaining assets after all other creditors and stakeholders have been paid. Therefore, its residual claim is generally considered least valuable or even worthless in such a scenario.

In the Case of Corporate Bankruptcy, Common Stock's Residual Claim