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This quiz consists of 5 multiple choice and 5 short answer questions through Part 3: Chapter 15, Boesky Day.
Multiple Choice Questions
1. Where did most of the money come from when Icahn actually acquired ACF, a railroad car leasing company?
(a) Ichan got the money from his uncle.
(b) Ichan sold all of his Milken junk bonds.
(c) Milken financed much of the price.
(d) Much of the purchase price came from the sale of some of the company's divisions.
2. Who made the acquisition in the American Natural Resources (ANR) case?
(a) Fred Joseph and Drexel
(b) Ted Turner and TNT
(c) J. P. Morgan and Chase Manhattan
(d) Oscar Wyatt and Coastal Corporation
3. What was Milken's biggest contribution to Drexel in the early years?
(a) a study of the securities delivery system which cut the delivery time from five days to one
(b) engineering the change over to computers
(c) an entry into the social circles of high-yield bond traders
(d) a recruiting system to get the brightest Ivy League graduates
4. What was the result of changes in the investment banking industry in the 1970s?
(a) Many new firms came into existence and were soon taken over.
(b) Firms became highly competitive and business moved around.
(c) Regulations now made it harder to trade in junk bonds.
(d) Business concentrated in New York and Los Angeles.
5. Why were Milken's imitators not as successful as he was?
(a) They could not invest as much firm money.
(b) They were bound by deeper government regulations.
(c) They could not raise the money Milken could or with the same speed.
(d) They had no idea how he was doing his business.
Short Answer Questions
1. Why was the Revlon takeover a landmark case for Perelman and Drexel?
2. What was a cause of the market crash of 1974?
3. Why did Atlantic Capital have to stop selling Wedvick's contracts?
4. What was the result when rules on M&A were finally adopted by the Congress?
5. When inflation raised the value of assets but not stock prices, what was the result?
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