The Magic Corporation Is Preparing to Sell an Issue of Debenture

Multiple Choice

The Magic Corporation is preparing to sell an issue of debenture bonds. The bond investors are insisting on getting further legal protection. They will, most likely, require a restrictive clause placing a ceiling on

A) further long- term borrowing.
B) using the same security for other debts.
C) the amount of dividends the company pays to management.
D) the salaries paid to board members.
E) the amount of money that goes into research and development.