#1
Which of the following is a consequence of bankruptcy?
Assets are sold to repay creditors
ExplanationBankruptcy leads to the sale of assets to repay debts.
#2
What is the main purpose of bankruptcy laws?
To provide relief to debtors and a fair distribution of assets to creditors
ExplanationBankruptcy laws aim to offer debtor relief and equitable creditor asset distribution.
#3
What happens to a bankrupt individual's assets?
They are seized and sold to pay off debts
ExplanationBankrupt individuals' assets are confiscated and sold to settle debts.
#4
Which type of bankruptcy involves the liquidation of assets to repay debts?
Chapter 7 bankruptcy
ExplanationChapter 7 bankruptcy entails asset liquidation for debt repayment.
#5
How long does a bankruptcy typically stay on a credit report in the United States?
7 years
ExplanationBankruptcies generally remain on credit reports for seven years.
#6
Which bankruptcy chapter is typically used for reorganization of businesses?
Chapter 11 bankruptcy
ExplanationChapter 11 bankruptcy is commonly employed for business reorganization.
#7
What is the role of a bankruptcy trustee?
To review and administer the bankruptcy estate
ExplanationBankruptcy trustees manage and oversee bankruptcy estates.
#8
What is an example of a non-dischargeable debt in bankruptcy?
Student loans (in most cases)
ExplanationStudent loans are usually not discharged in bankruptcy.
#9
What is the difference between Chapter 7 and Chapter 13 bankruptcy?
Chapter 7 involves liquidation of assets, while Chapter 13 involves a repayment plan
ExplanationChapter 7 liquidates assets, while Chapter 13 implements a repayment plan.
#10
Which debts are typically not dischargeable in bankruptcy?
Student loans (in most cases)
ExplanationStudent loans are generally not dischargeable in bankruptcy.
#11
What is a bankruptcy discharge injunction?
An order preventing creditors from attempting to collect discharged debts
ExplanationA discharge injunction bars creditors from pursuing discharged debts.
#12
Which chapter of bankruptcy is primarily for municipalities?
Chapter 9 bankruptcy
ExplanationChapter 9 bankruptcy is chiefly for municipalities.