1. Protective covenants (select one)
A) are designed to protect the issuer should it default.
B) are primarily designed to protect bondholders from future actions of the bond issuer.
C) are consistent for all bonds issued by a corporation within the United States.
D) only apply to bonds that have a deferred call provision.
E) are limited to stating actions that a firm must take.
2. An annuity:
A) has a greater value than a comparable perpetuity.
B) is a stream of payments that fluctuate with current market interest rates.
C) has a longer life span than a perpetuity.
D) is a stream of equal payments that occur in equal periods of time for a finite period.
E) is either an equal or an unequal stream of payments that occur in equal time periods for a finite period.