Equity refers to the ownership of assets of a company that may have debts or other liabilities attached to them. Thus, equity represents the ownership value that would be returned to a shareholder of a company when the company is liquidated and all the debts of the company are paid off.

The equity of a company is the net balance of its assets minus liabilities. To distinguish it from the equity of a single asset, this value is sometimes referred to as total equity for a company or organization as a whole. Shareholders equity is thus the overall net-worth of a company or corporation.

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