Which of the Following Would Be Considered a "Negative" Loan

question 22

Multiple Choice

Which of the following would be considered a "negative" loan covenant?

• A) The firm's current ratio cannot fall below 2.0
• B) All property must be maintained in good condition
• C) The firm's net worth must exceed $10,000,000
• D) The firm must carry property insurance on all collateral.
• E) Cash dividends cannot exceed 50% of earnings.

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Definitions:

Couches

Upholstered pieces of furniture designed for seating multiple people, commonly used in living spaces for comfort and relaxation.

Rate Of Trade-off

The rate at which one good or service must be sacrificed to produce an additional unit of another good or service, often related to the concept of opportunity cost.

Chairs

Furniture pieces designed for sitting, typically consisting of a seat, back, legs, and sometimes arm supports.

Couches

Furniture pieces designed for seating multiple people, characterized by a long seating area with back and arm support.