When Genius Failed Test | Final Test - Hard

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 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.

Short Answer Questions

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

2. In the mid-1990's, what was the ratio of leverage on Wall Street?

3. Why was Long-Term unable to get out of the situation with Russia?

4. At what level was the swap rate of the United States in April 1998?

5. On what date did Russia declare a debt moratorium?

Short Essay Questions

1. What contributes to the estimation of market volatility?

2. Since Long-Term expected stock prices would fall, what did they sell insurance against?

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

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

5. Who warned Long-Term about making trades that counted on falling stock prices?

6. What did the Fed determine would happen if Long-Term failed?

7. Who was Jon Corzine?

8. Following the crisis in Russia, what position did investors take that adversely affected Long-Term?

9. When did huge losses begin for Long-Term and why?

10. In 1997, what was Meriwether encouraging his employees to do?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

The international market provided Long-Term with a substantial opportunity for success. Write an essay examining Long-Term's initial involvement in the international market and the results of this investment.

Essay Topic 2

Examine one of the following forms of investment vehicles:

- Hedge funds.

- Value funds.

- Bonds.

Answering the follow questions:

- What are the principals of this form of investment?

- What was Meriwether's experience with this form of investment?

- To what extent did the general public participate in this form of investment?

Essay Topic 3

When Long-Term achieved major profits in its first year, Meriwether wrote a letter to investors warning against such a strong future performance.

1) Why did Meriwether feel it was important to communicate with his investors?

2) What warnings did Meriwether share with his investors?

3) Why did Meriwether feel it necessary to communicate at this level?

(see the answer keys)

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