Which of the Following Would Be Classified as a Positive

question 315

Multiple Choice

Which of the following would be classified as a positive protective covenant?

• A) The firm must furnish audited annual financial statements.
• B) The firm cannot pledge any assets to other lenders.
• C) The firm must not issue additional long-term debt.
• D) The firm cannot merge with another firm.
• E) The firm must limit the amount of dividends it pays according to some formula.

---

Definitions:

Real GDP

Real GDP, which accounts for inflation, quantifies the total value of goods and services a nation's economy generates in actual terms.

BTU Of Energy Consumption

A measure of energy consumption, the British Thermal Unit (BTU) quantifies the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit.

Energy Efficiency

The goal of using less energy to provide the same service or achieve the same outcome.

Time-Value Of Money

The idea that a specific amount of money is more valuable to a person the sooner it is received because the money can be placed in a financial account or investment and earn compound interest over time; the opportunity cost of receiving a sum of money later rather than earlier.