Explicit provisions in a loan agreement that prohibit the borrower from engaging in certain activities is called:
A) restrictive covenants
B) adverse selection
C) credit-risk analysis
D) credit rationing
Answer: A
Explicit provisions in a loan agreement that prohibit the borrower from engaging in certain activities is called:
A) restrictive covenants
B) adverse selection
C) credit-risk analysis
D) credit rationing
Answer: A