Tennessee Private Investigator Licensing Practice Exam

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Prepare for the Tennessee Private Investigator Test. Use flashcards and multiple choice questions; each has hints and explanations. Maximize your exam readiness!

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Which bankruptcy chapter is designed specifically for small businesses?

Chapter 7
Chapter 11
Chapter 13
Chapter 12

The correct answer is: Chapter 13

The chapter of bankruptcy that is specifically designed for the needs of small businesses is Chapter 11. This provision allows small businesses to reorganize their debts while continuing to operate. It offers a way for businesses to create a plan to repay creditors over time and maintain their operations, which is critical for their survival and recovery. Chapter 11 is tailored for businesses of various sizes, but it's particularly beneficial for small enterprises that need relief from debts while keeping their business afloat. Other types of bankruptcy are less focused on the specific needs of small businesses. Chapter 7, for example, typically involves liquidation of assets and is more suited to individuals or businesses that are unable to pay their debts. Chapter 13 is designed for individuals with regular income who wish to create a repayment plan for personal debts, and Chapter 12 is specifically for family farmers and fishermen. Thus, while they serve important functions, they do not cater exclusively to the unique circumstances of small businesses as Chapter 11 does.