List Four Protective Covenants That You Might Be Interested in as a Prospective

question 17

Essay

List four protective covenants that you might be interested in as a prospective bondholder.Briefly describe why these would be realistic bondholder concerns.Note: the text did not list four covenants, so you must be creative.

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Definitions:

Tax-Exempt Status

A designation that allows an organization or entity to be exempt from federal income tax under certain sections of the Internal Revenue Code.

Charitable Contribution

Donations or gifts to charitable organizations, which can be deductible from an individual's taxes.

Itemize

This refers to the process of individually listing tax deductions on one's tax return, rather than taking the standard deduction.

Investment Interest Expense

The amount of interest paid on debt incurred for investments, allowing taxpayers to deduct it under certain conditions.