In Chapter 7 bankruptcy, liquidation, A. all the debtors' debts are discharged. B. the debtor keeps their assets. C. the trustee sells off the debtor's assets and pays creditors. D. the debtor pays the creditors directly.

In Chapter 7 bankruptcy, liquidation, the trustee sells off the debtor's assets and pays creditors. A Chapter 7 bankruptcy often turns into a Chapter 13 which is based around selling debt off to pay creditors. Selling off the assets and liquidating them gives them cash on hand to pay off what needs to be paid.