Which of the Following Is an Example of an Appropriate

question 61

Multiple Choice

Which of the following is an example of an appropriate loan covenant?

• A) The firm must not increase its debt ratio by more than 3 percent.
• B) The firm must keep its current ratio above 2.2.
• C) The firm must purchase an insurance policy on a key employee.
• D) All of the options are examples of appropriate loan covenants.

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