Reference no: EM131054606
1) Bond indentures include restrictive covenants. These provisions protect the bondholders against ________.
A) increase in inflation rate
B) increase in borrower's risk
C) decrease in liquidity risk
D) maturity risk
2) Stock purchase warrants are instruments that give their holders ________.
A) the obligation to purchase a certain number of shares of the issuer's common stock at a specified price over a certain period of time
B) the right to purchase a certain number of shares of the issuer's common stock at a specified price over a certain period of time
C) the obligation to sell a certain number of shares of the issuer's preferred stock at a specified price over a certain period of time
D) the right to sell a certain number of shares of the issuer's preferred stock at a specified price over a certain period of time
3) Bonds which sell at less than face value are priced at a ________, while bonds which sell at greater than face value sell at a ________.
A) par; premium B) discount; par C) discount; premium D) coupon; premium.
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Bond indentures include restrictive covenants
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