When Genius Failed Test | Final Test - Medium

Roger Lowenstein
This set of Lesson Plans consists of approximately 99 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. During the financial crisis in 1998, what did the partners keep from the workers?
(a) Hope.
(b) Information.
(c) Money.
(d) Profits.

2. How did regulators respond to the involvement of banks in the derivatives market?
(a) They were delighted.
(b) There were not concerned.
(c) They were worried.
(d) They encouraged it.

3. What award did Merton and Scholes win for economics?
(a) The Academy Award.
(b) The Nobel Prize.
(c) The Wall Street Trust.
(d) None of these.

4. Who did Long-Term threaten to sue, following a threat not to clear trades?
(a) ING trading.
(b) Bear Sterns.
(c) Waterhouse Cooper.
(d) Chase.

5. On what date did Russia declare a debt moratorium?
(a) August 17.
(b) July 4.
(c) August 31.
(d) September 30.

Short Answer Questions

1. After the Russian financial crisis, what caused further fluctuations in the market?

2. What year was the Federal Reserve System created?

3. What did the incident on August 21 cost Long-Term?

4. To create a paired-share, what is common stock partnered with?

5. What was the result for some banks due to their involvement in the derivatives market?

Short Essay Questions

1. Why did banks and investment banks get involved in the derivatives market?

2. When Meriwether reached out to his clients following the Russian crisis, how did he explain the effect of the situation in Russia?

3. By the end of August 1998, what did the movement in the bond market look like?

4. During the financial crisis in 1998, where were the partners finding money?

5. Why were regulators concerned about the volume of banks and investment banks involved in the derivatives market?

6. What did Standard & Poor downgrade that would affect Long-Term significantly?

7. What strategy led to Long-Term's downfall during the Russian financial crisis?

8. Why did the issue in Russia cost Long-Term money on an initial basis?

9. Who was Jon Corzine?

10. What was the risk to the market if Long-Term unraveled?

(see the answer keys)

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