|Name: _________________________||Period: ___________________|
This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.
Short Answer Questions
1. What put pressure on the currency in Brazil?
2. What did Long-Term risk losing if they allowed their assets to fall below five hundred million dollars?
3. What trading date dropped Long-Term below $1 billion in equity?
4. What was the dollar amount of the premium Long-Term paid for its loan?
5. What year was the Federal Reserve System created?
Short Essay Questions
1. When did huge losses begin for Long-Term and why?
2. What did Long-Term do when they expected stock prices to fall?
3. Why did banks and investment banks get involved in the derivatives market?
4. In spite of the economic crisis in Russia, what did Meriwether believe about Long-Term's trades?
5. Since Long-Term expected stock prices would fall, what did they sell insurance against?
6. In 1997, what was Meriwether encouraging his employees to do?
7. Following the crisis in Russia, what position did investors take that adversely affected Long-Term?
8. What did Standard & Poor downgrade that would affect Long-Term significantly?
9. Who warned Long-Term about making trades that counted on falling stock prices?
10. Why did the issue in Russia cost Long-Term money on an initial basis?
Write an essay for ONE of the following topics:
Essay Topic 1
Meriwether began his career at Salomon Brothers before starting Long-Term. Write a detailed profile of his career path at Salomon Brothers, answering the following questions.
1) What risk did Meriwether take at Salomon Brothers?
2) What were the challenges and rewards?
3) Why did his career at Salomon Brothers come to an end?
Essay Topic 2
Those involved at the top levels of Long-Term were given respect, money and opportunity. Write a brief essay analyzing some of the advantages a career at Long-Term gave many of the partners, citing examples from the text.
Essay Topic 3
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.
This section contains 499 words
(approx. 2 pages at 300 words per page)