Stockton, a City in California, Declared Chapter 9 Bankruptcy in 2012

question 30

True/False

Stockton, a city in California, declared Chapter 9 bankruptcy in 2012 to avoid having to close key functions such as their police and fire departments.

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Definitions:

Risk

The exposure to potential financial loss or gain, often measured by the variability of returns.

Limited Liability Protection

A legal structure that shields a company's owners from being personally responsible for the company's debts or liabilities.

Corporate Form

A legal business structure recognized in many jurisdictions allowing the company to operate as a separate legal entity apart from its owners, providing limited liability and ease of ownership transfer.

Entrepreneurs

Individuals who create, launch, and manage new businesses, taking on most of the risks and reaping most of the rewards of the venture.