Books online states that shrinkdatabase cannot shrink smaller than its original size. So, how does SQL Server know the initial size / original size of the database without saving it in any of the system tables?
When using the DBCC SHRINKDATABASE statement, you cannot shrink a whole database to be smaller than its original size. Therefore, if a database was created with a size of 10 MB and grew to 100 MB, the smallest the database could be reduced to is 10 MB, even if all the data in the database has been deleted.