Debt and Bankruptcy

Debt can be avoided through which of the following? 

• Frivolous spending
• Investing in high risk opportunities 
•  Budgeting finances
• Employer benefits 

 Which of the following is NOT a solution if expenses exceed income? 

•  Cut down 
• Increase income sources 
•  Consolidate debt 
• Mutual funds 

 A rule of thumb for paying more than the minimum payment is minimum payment + interest charged + additional 2 percent of total balance = monthly payment. 

• True
• False

Consolidating debt allows you to secure a loan paying off all your debt at a higher rate

• True
• False

Debt-to-income ration includes daily living expenses.

• True
• False

Bankruptcy is classified into how many types? 

• Ten
• Five
• Four
• Three

Chapter 7: Ordinary Bankruptcy can only be filed involuntarily. 

• True
• False

Which bankruptcy classification is the desire to rebuild a debtor-creditor relationship? 

• Chapter 7
•  Chapter 11 
•  Chapter 12 
•  Chapter 13 

 Chapter 11: Reorganization involves business organizations only. 

• True
• False

 Declaring bankruptcy is not a matter of public record. 

• True
• False