Why Do Bonds Often Include Covenants

question 59

Multiple Choice

Why do bonds often include covenants?

• A)To reduce information asymmetry.
• B)To reduce moral hazard.
• C)To compensate for value-added services.
• D)To ensure repayment of the bond.

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Definitions:

Genetics

The investigation into genetic inheritance and the differences in traits passed down through generations.

Social Environment

The immediate physical and social setting in which people live or in which something happens or develops, including the culture that the individual is educated or lives in.

Physiological Forces

Biological or bodily drives and processes that influence behavior and mental states.

Unconditional Positive Regard

A concept in psychology that entails accepting and supporting a person regardless of what they say or do.