Agency costs arise any time there is a conflict between stockholder interests and lender interests. Assuming that agency costs are high at a company, relative to the rest of the market, which of the following would you expect to observe with the companys borrowing?

a.

None of the above

b.

All of the above

c.

It will be able to borrow less than other companies

d.

It will face more covenants than otherwise similar companies

e.

It will have to pay higher interest rates on its loans than otherwise similar companies