Question

With respect to creditors, the main goal of bankruptcy law is to group of answer choices

O make all debtor property available for all creditor claims.
O ensure equitable treatment in the competition for debtor assets.
O protect creditor assets from diminution in value.
O ensure that creditors will continue to lend to insolvent debtors.

Answer 1

The main goal of bankruptcy law regarding creditors is to ensure that there is an equitable treatment and fair distribution of debtor assets among creditors.

Step-by-step explanation:

The main goal of bankruptcy law with respect to creditors is to ensure equitable treatment in the competition for debtor assets. Bankruptcy laws are designed not to make all debtor property available for all creditor claims, nor to protect creditor assets from diminution in value or ensure that creditors will continue to lend to insolvent debtors. Instead, these laws aim to provide a balanced and fair approach to satisfying creditors' claims when a debtor is unable to fulfill their financial obligations.

In the event of bankruptcy, procedures are in place to ensure assets are distributed fairly among creditors. This may include the sale of the debtor's assets, with the proceeds distributed according to the priority of claims. This priority is often influenced by the nature of the debt, with secured creditors typically receiving payment before unsecured creditors.