When bankruptcy occurs,the claims of the ordinary shareholders may go unsatisfied.

Question

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When a company goes bankrupt, the first priority is to pay off secured creditors followed by unsecured creditors. Shareholders come last in the priority list and may not receive anything if there are no assets left to distribute after paying off higher priority claims. Therefore, it is possible for the claims of ordinary shareholders to go unsatisfied in bankruptcy.

When Bankruptcy Occurs,the Claims of the Ordinary Shareholders May Go