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20. Bankruptcy laws can make the government a shareholder in all businesses. Chapter 7 of the U.S. Bankruptcy Code (Liquidation) involves:

 

  • Paying off the existing debt of a firm and negotiating new debt contracts.
  • Terminating a firm and selling the assets based on their salvage value.
  • Restructuring the debt and equity side of the firm.
  • Restructuring only the debt side of the firm.

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