Which of the following describes a fixed charge coverage ratio?
A) It measures a borrower/issuer's ability to cover its fixed obligations, including debt interest and lease obligations
B) It prohibits the ratio of total debt-to-EBITDA for the trailing four quarters from exceeding a level set in a defined quarterly schedule
C) It prohibits the ratio of total debt-to-EBITDA for the trailing four quarters from falling below a level set in a defined quarterly schedule
D) It prohibits the borrower and its subsidiaries from exceeding a set dollar amount of capital expenditures in any given year
Answer: A