1-It is easier for minor shareholders to elect representatives in the board of directors when:

	A.	Shareholders receive a consistently high rate of return.
	B.	Management controls most of the common shares outstanding.
	C.	Preferred shares are not convertible.
	D.	Cumulative voting is used.
	E.	Voting by proxy is not permitted.

2-Which of the following is an example of a positive covenant?

	A.	The firm cannot merge with another firm.
	B.	The firm cannot sell or lease any major assets without approval by the lender.
	C.	The company must maintain its working capital at or above some specified minimum level.
	D.	The firm cannot pledge any assets to other lenders.
	E.	The firm must limit the amount of dividends it pays according to some formula.