Final answer:
The statement is true; a debtor is one who has declared bankruptcy. Debtors face legal proceedings where assets are reorganized or liquidated to repay creditors. Historical and modern examples, like Nashville's 1819 bankruptcy surge and Detroit's bankruptcy filing, illustrate the concept.
Step-by-step explanation:
The statement that a debtor is the person or entity who is subject to a bankruptcy filing is True. A debtor is indeed an individual or company that has filed for bankruptcy protection because they are unable to repay their debts. In the process of bankruptcy, assets may be liquidated or reorganized to pay off creditors, and certain legal protections are afforded to the debtor.
Historical instances, such as in Nashville during 1819 where numerous bankruptcies were reported, emphasize the struggles of debtors during economic crises. Similarly, bond issuers who are unable to meet their financial obligations to bondholders may face bankruptcy proceedings, where assets are sold to repay as much debt as possible. An example of this is the city of Detroit, which declared bankruptcy due to massive debt and was able to restructure its debts through the bankruptcy process.