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What is equity?
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Answer Posted / adarsh c i
equity is the residual claim or interest of the most
junior class of investors in assets, after all liabilities
are paid. If valuations placed on assets do not exceed
liabilities, negative equity exists. In an accounting
context, Shareholders' equity (or stockholders' equity,
shareholders' funds, shareholders' capital or similar
terms) represents the remaining interest in assets of a
company, spread among individual shareholders of common or
preferred stock.
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