1. A secured bond would require:

a. a claim on specific assets in the event of default

b. a plan for paying off the bond at maturity

c. an independent trustee

d. none of the answers is correct

e. no restrictive covenants

2. Which of the following statements best describes preferred stock?

a. none of the answers is correct

b. it has a fluctuating claim on earnings

c. it enables the holder to have voting rights

d. since it is a form of debt, its dividends must be paid each year or else the company will be in bankruptcy court

e. it has a fixed claim