Which of the Following Is True of Covenants and Conditions

question 48

Multiple Choice

Which of the following is true of covenants and conditions?

• A) A covenant is a conditional promise to perform.
• B) A conditional promise becomes a covenant if the condition is met.
• C) A contract cannot contain conditions to excuse performance.
• D) A party cannot sue over breach of a covenant by the other party.

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Definitions:

Standard Deviation

A statistic that measures the dispersion or variability of a distribution, indicating how much individual values deviate from the mean.

Long Bonds

Bonds with a long duration to maturity, typically more than 10 years, and are sensitive to interest rate changes.

Period

A length or portion of time.

Capital Gains Yield

The part of an investment's total return that comes from the increase in its value, not including dividends or interest earnings.