1)

What happens when a firm suspected of fraud is going through the process of Chapter 11?

Select one:

a. A committee of unsecured creditors will be appointed to negotiate a reorganization through Chapter 11.

b. Current management can work with a team from the US bankruptcy court if no member of the management team has been convicted of fraud.

c. The management of the firm retains the right to renegotiate the terms of debt.

2)

(T/F) A workout is the term for when a firm works with its creditors to voluntarily restructure the terms of its current debt to avoid bankruptcy.

Select one:

True

False

3)

What happens when no fair and feasible reorganization can be worked out between the creditors and the firm in financial distress?

Select one:

a. The firm must file Chapter 11

b. The firm must file Chapter 13

c. The firm must file Chapter 7

d. The firm must file Chapter 8

4) What type of bankruptcy is filed by the creditors of a firm?

Select one:

a. Voluntary bankruptcy

b. Involuntary bankruptcy

5)

What is the name for the process when a publicly traded firm issues additional new stock to be traded on a stock exchange?

Select one:

a. A seasoned offering

b. An initial public offering

c. A return offering

d. A treasury offering