The stockholders of a business have a priority claim to its assets in the event of liquidation.

Name: The stockholders of a business have a priority claim to its assets in the event of liquidation.
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Question

Quizplus · Accepted Answer

This is false.Creditors have priority in business liquidations.This means the business uses its assets first to settle the obligations to the creditors.Any assets remaining after the creditors have been paid are then distributed to the investors.

The Stockholders of a Business Have a Priority Claim to Its