The Big Short: Inside the Doomsday Machine Test | Mid-Book Test - Medium

Michael Lewis (author)
This set of Lesson Plans consists of approximately 132 pages of tests, essay questions, lessons, and other teaching materials.
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This test consists of 5 multiple choice questions, 5 short answer questions, and 10 short essay questions.

Multiple Choice Questions

1. What is a legal document that institutions and businesses use to describe the securities they are offering for participants and buyers?
(a) Contract.
(b) Syllabus.
(c) Terms of Service.
(d) Prospectus.

2. What majority-owned subsidiary of Fimalac, S.A., is a global rating agency dedicated to providing value beyond the rating through independent and prospective credit opinions, research and data?
(a) Standard & Poor's.
(b) The Fitch Group.
(c) Deutsche Bank.
(d) Wachovia.

3. What is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds?
(a) Standard & Poor's.
(b) Cornwall Capital Management.
(c) Scion Capital.
(d) Deutsche Bank.

4. In Chapter 5, Charlie Ledley and Jamie Mai continued to make risky investments until they had grown their investment company to how much?
(a) $75 million.
(b) $200 million.
(c) $30 million.
(d) $10 million.

5. Gene Park worked in offices where in Chapter 4?
(a) Connecticut.
(b) Virginia.
(c) Maine.
(d) Rhode Island.

Short Answer Questions

1. Meredith Whitney was an analyst of financial firms for what company in 2007?

2. With the creation of ______, mortgage companies became inspired to grow quickly and offer a great many loans to customers.

3. Gene Park discovered that the CDSs being sold by his company contained more what than anyone knew?

4. What does CDO stand for?

5. What is the title of Chapter 4?

Short Essay Questions

1. What led Steve Eisman to open his own hedge fund?

2. What did Steve Eisman's team conclude after analyzing the mortgage data in Chapter 4?

3. How is Mike Burry described in Chapter 3? What did he study before entering the stock market?

4. What did Steve Eisman discover about Household Finance Corporation in Chapter 1?

5. How are AIG FP's actions described in Chapter 3?

6. Discuss Steve Eisman's work with mortgage bonds. How were mortgage bonds divided?

7. What led to mortgage companies extending loans to unreliable clients, as described in Chapter 1?

8. What patterns did Steve Eisman's team discover in mortgage trading in Chapter 4?

9. What picture does the author paint of Steve Eisman and Wall Street in 2005 in Chapter 1?

10. How did Cornwall Capital Management secure an ISDA? What did this mean for the company?

(see the answer keys)

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