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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. In its first bad year, what did Long-Term maintain?

2. During the financial crisis in 1998, what did the partners keep from the workers?

3. What regulation did Long-Term bypass when trading equities?

4. What trading date dropped Long-Term below $1 billion in equity?

5. What companies were selling bonds for Russia?

Short Essay Questions

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

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

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

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

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

6. How much of Long-Term did the Union Bank of Switzerland buy on a hedge?

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

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

9. Who was Jon Corzine?

10. What move did Salomon make that surprised Long-Term?

Essay Topics

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

Basing your answer on the height of Long-Term's career, compare and contrast several of the companies on Wall Street with Long-Term, citing examples from the text.

Essay Topic 3

There were many warning signs that the profits delivered by Long-Term couldn't last. Yet, many companies did everything possible to keep some investments going at higher and higher levels when they should have slowed. Using greed as a theme, analyze this situation.

(see the answer keys)

This section contains 492 words (approx. 2 pages at 300 words per page) View a FREE sample