The answer to this problem is "FALSE". It is not true that a common stockholder has no guarantee of receiving any cash flows, but receives what is left after all other claims in the firm's income and assets have been satisfied. The truth is common stockholders are the true owner of the firm. They are also sometimes called as the residual owner or the residual claimants. They took the residual claims on the firms and they are very assured that they cannot lose the amount that they invested in the firm.
