Discussion
These shareholders are also known as residual owners:
Answer: A
Equity shareholders are the owners of the company and receive what is left of the profits after all the claims of the creditors and the preference shareholders are paid, so they are called residual owners. Preference shareholders get a fixed dividend, debenture holders are creditors who get interest, and convertible shareholders are not a separate class of owners. The answer is equity shareholders, option A. They bear the greatest risk, as they are paid only after the creditors and the preference shareholders, but they also get the profit that remains.
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