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Bankruptcy Law Fundamentals

Test your knowledge of bankruptcy law concepts including different bankruptcy chapters, the means test, automatic stay, debt discharge, and the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.

15 Questions Published
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Questions

Question 1 Multiple Choice (Single Answer)

What is the primary purpose of bankruptcy laws?

  1. To provide relief to debtors who are unable to repay their debts.
  2. To punish debtors for their financial mismanagement.
  3. To redistribute wealth from the rich to the poor.
  4. To stimulate the economy by increasing consumer spending.
Question 2 Multiple Choice (Single Answer)

Which type of bankruptcy is most commonly filed by individuals?

  1. Chapter 7
  2. Chapter 11
  3. Chapter 12
  4. Chapter 13
Question 3 Multiple Choice (Single Answer)

What is the difference between Chapter 7 and Chapter 13 bankruptcy?

  1. In Chapter 7, debtors liquidate their assets and discharge their debts, while in Chapter 13, they repay their debts over time.
  2. In Chapter 7, debtors are required to sell their assets, while in Chapter 13, they are allowed to keep their assets.
  3. In Chapter 7, debtors are not allowed to file for bankruptcy again, while in Chapter 13, they can file for bankruptcy multiple times.
  4. In Chapter 7, debtors are required to pay back all of their debts, while in Chapter 13, they are only required to pay back a portion of their debts.
Question 4 Multiple Choice (Single Answer)

What is the means test in bankruptcy?

  1. A test to determine if a debtor is eligible to file for Chapter 7 bankruptcy.
  2. A test to determine if a debtor is eligible to file for Chapter 13 bankruptcy.
  3. A test to determine if a debtor is eligible to file for Chapter 11 bankruptcy.
  4. A test to determine if a debtor is eligible to file for Chapter 12 bankruptcy.
Question 5 Multiple Choice (Single Answer)

What is the purpose of the automatic stay in bankruptcy?

  1. To stop creditors from contacting the debtor.
  2. To stop creditors from collecting debts from the debtor.
  3. To stop creditors from foreclosing on the debtor's property.
  4. To stop creditors from repossessing the debtor's property.
Question 6 Multiple Choice (Single Answer)

What is the difference between a secured debt and an unsecured debt?

  1. A secured debt is backed by collateral, while an unsecured debt is not.
  2. A secured debt has a higher interest rate than an unsecured debt.
  3. A secured debt is more difficult to discharge in bankruptcy than an unsecured debt.
  4. A secured debt is less likely to be included in a Chapter 13 bankruptcy plan than an unsecured debt.
Question 7 Multiple Choice (Single Answer)

What is a reaffirmation agreement in bankruptcy?

  1. An agreement between the debtor and a creditor to repay a debt that was discharged in bankruptcy.
  2. An agreement between the debtor and a creditor to modify the terms of a debt that was discharged in bankruptcy.
  3. An agreement between the debtor and a creditor to extend the time to repay a debt that was discharged in bankruptcy.
  4. An agreement between the debtor and a creditor to waive the discharge of a debt in bankruptcy.
Question 8 Multiple Choice (Single Answer)

What is the difference between a Chapter 11 bankruptcy and a Chapter 13 bankruptcy?

  1. Chapter 11 bankruptcy is for businesses, while Chapter 13 bankruptcy is for individuals.
  2. Chapter 11 bankruptcy allows debtors to reorganize their debts, while Chapter 13 bankruptcy allows debtors to repay their debts over time.
  3. Chapter 11 bankruptcy is more expensive than Chapter 13 bankruptcy.
  4. Chapter 11 bankruptcy is more difficult to qualify for than Chapter 13 bankruptcy.
Question 9 Multiple Choice (Single Answer)

What is the purpose of the discharge in bankruptcy?

  1. To release the debtor from personal liability for their debts.
  2. To allow the debtor to keep their assets.
  3. To stop creditors from contacting the debtor.
  4. To stop creditors from collecting debts from the debtor.
Question 10 Multiple Choice (Single Answer)

What debts are not dischargeable in bankruptcy?

  1. Student loans
  2. Child support
  3. Alimony
  4. Taxes
Question 11 Multiple Choice (Single Answer)

What is the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005?

  1. A law that made it more difficult for individuals to file for bankruptcy.
  2. A law that made it more difficult for businesses to file for bankruptcy.
  3. A law that made it more difficult for creditors to collect debts from debtors.
  4. A law that made it more difficult for debtors to discharge their debts.
Question 12 Multiple Choice (Single Answer)

What is the difference between a Chapter 12 bankruptcy and a Chapter 13 bankruptcy?

  1. Chapter 12 bankruptcy is for family farmers, while Chapter 13 bankruptcy is for individuals.
  2. Chapter 12 bankruptcy allows debtors to reorganize their debts, while Chapter 13 bankruptcy allows debtors to repay their debts over time.
  3. Chapter 12 bankruptcy is more expensive than Chapter 13 bankruptcy.
  4. Chapter 12 bankruptcy is more difficult to qualify for than Chapter 13 bankruptcy.
Question 13 Multiple Choice (Single Answer)

What is the purpose of the means test in bankruptcy?

  1. To determine if a debtor is eligible to file for Chapter 7 bankruptcy.
  2. To determine if a debtor is eligible to file for Chapter 13 bankruptcy.
  3. To determine if a debtor is eligible to file for Chapter 11 bankruptcy.
  4. To determine if a debtor is eligible to file for Chapter 12 bankruptcy.
Question 14 Multiple Choice (Single Answer)

What is the difference between a Chapter 9 bankruptcy and a Chapter 11 bankruptcy?

  1. Chapter 9 bankruptcy is for municipalities, while Chapter 11 bankruptcy is for businesses.
  2. Chapter 9 bankruptcy allows debtors to reorganize their debts, while Chapter 11 bankruptcy allows debtors to repay their debts over time.
  3. Chapter 9 bankruptcy is more expensive than Chapter 11 bankruptcy.
  4. Chapter 9 bankruptcy is more difficult to qualify for than Chapter 11 bankruptcy.
Question 15 Multiple Choice (Single Answer)

What is the purpose of the automatic stay in bankruptcy?

  1. To stop creditors from contacting the debtor.
  2. To stop creditors from collecting debts from the debtor.
  3. To stop creditors from foreclosing on the debtor's property.
  4. To stop creditors from repossessing the debtor's property.
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