Term contained in bond indenture agreements

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1. You own both a May 20 call and a May 20 put. If the call finishes in the money, then the put will:

also finish in the money.

finish out of the money.

either finish at the money or out of the money.

finish at the money.

either finish at the money or in the money.

2. Which of the following may tend to keep dividends low?

I. a state law restricting dividends in excess of retained earnings

II. a term contained in bond indenture agreements

III. the desire to maintain constant dividends over time

IV. flotation costs

II and III only

I and IV only

II, III, and IV only

I, II, and III only

I, II, III, and IV

Reference no: EM132028726

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