To reduce moral hazard problems, banks include restrictive covenants in loan contracts. In order for these restrictive covenants to be effective, banks must also be: a) prepared to extend the deadline when the borrower needs more time to comply. b) trust the borrower to do the right thing. c) monitor and enforce them. d) be willing to rewrite the contract if the borrower cannot comply with the restrictions.
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “To reduce moral hazard problems, banks include restrictive covenants in loan contracts. In order for these restrictive covenants to be ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
What are two variables needed to calculate demand?
Answers (1)
Which of the following best describes how economists test the empirical predictions of economic models? A) Economists survey individuals to learn about how people think through decisions about how much to purchase or to produce.
Answers (1)
Which statements apply to leasing a car? Check all that apply A. The car may be driven as much as needed. B. Payments are generally higher than buying. C. There are mileage restrictions on the car. D. You must return the car after the lease ends. E.
Answers (1)
Luker Corporation uses a process costing system. The company had $164,500 of beginning Finished Goods Inventory on October 1. It transferred in $841,000 of units completed during the period.
Answers (1)
Sociologists have concluded that the most important functions of religion are social cohesion, social control, and emotional support.
Answers (1)
New Questions in Business
Beasley, Inc., reports the following amounts in its December 31, 2021, income statement. Sales revenue $ 350,000 Income tax expense $ 36,000 Interest expense 13,000 Cost of goods sold 120,000 Salaries expense 35,000 Advertising expense 25,000
Answers (1)
Minimum wage laws have the smallest effect on which segment of the labor force? a. low-skilled labor b. teenagers c. skilled workers d. unemployed workers
Answers (1)
A retailer buys a painting for $200. she sets the selling price at $450. when the painting doesn't sell after two months, she raises the price to $800 to appeal to a different market. the painting sells for $800 the next day.
Answers (1)
Kathy Brooks is a franchisee who wishes to donate her old HRB workstations and server to a local charity for a fundraising auction.
Answers (1)
True or false Every risk an individual faces can be insured
Answers (2)