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Common shares have a residual claim on firm assets. This means... Question 11 options: a) They get whatever's left over after interest, taxes and preferred

Common shares have a "residual claim" on firm assets. This means... Question 11 options: a) They get whatever's left over after interest, taxes and preferred dividends are paid. b) Leverage reduces the value of shares because interest takes cash that would have gone to shareholders. c) Preferred shares can't be sold in the open market because they have a claim similar to that of bonds. d) You'd have to be crazy to buy common shares.

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