The Grass Is Greener Company Borrows Money from a Bank

Multiple Choice

The Grass is Greener Company borrows money from a bank.Part of the loan agreement requires Grass is Greener to maintain stockholders' equity of at least 40% of assets or otherwise to pay a higher interest rate.This requirement is referred to as a:

A) loan covenant.
B) credit rating.
C) bond rating.
D) call feature.