Question

1. what does chapter 11 bankruptcy allow a business to do?

a. reorganize and develop a plan to become profitable again
b. avoid paying taxes
c. close down immediately
d. increase its borrowing limit

Explanation:

Chapter 11 bankruptcy is a form of bankruptcy that allows businesses to restructure their debts and operations. The goal is to help the business become profitable again. Options B (avoiding taxes is illegal and not a purpose of Chapter 11), C (Chapter 11 is about reorganization, not immediate closure), and D (increasing borrowing limit is not the main aim of Chapter 11) are incorrect.

Answer:

A. Reorganize and develop a plan to become profitable again