a) Information asymmetry is what leads bondholders to impose restrictive covenants. In light of this statement, define what are restrictive covenants and indicate the specific type of information asymmetry that can be minimized through such covenants.

b) Sophie Maddox invests in 50 shares of Spidey Comics Inc. Spideys stock offers a current dividend of $2 per share, which grows at the rate of 4% p.a. indefinitely. Sophia expects to sell her shares at the end of year 5 and requires a return of 11% on her investment. Given this information; i) Compute the current price of Spidey Inc.s shares ii) Compute the price of Spidey Inc.s shares at the end of 5 years iii) Compute Sophias overall percentage return on her investment for the 5-year period, assuming she receives dividends for time 0 through time 5 iv) Compute the growth rate in Spideys stock price v) What relationship do you observe between the stock price and growth in dividends, assuming all else remains the same.