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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. What refers to a public entity for the trading of company stock and derivatives at an agreed price?
(a) Bond market.
(b) Capital market.
(c) Stock market.
(d) Treasury market.

2. Who is the protagonist of The Fountainhead?
(a) Howard Roark.
(b) Sarah Anderson.
(c) John Gatsby.
(d) Dagny Taggart.

3. What refers to the part of the capital markets that deals with the issuance of new securities?
(a) Speculative market.
(b) Derivatives market.
(c) Primary market.
(d) Secondary market.

4. Alan Greenspan was born in what area of New York City?
(a) Washington Heights.
(b) Astoria, Queens.
(c) The Upper East Side.
(d) Greenwich Village.

5. When was Alan Greenspan born?
(a) 1926.
(b) 1953.
(c) 1911.
(d) 1940.

6. Alan Greenspan served as Chairman of the Federal Reserve of the United States during what years?
(a) 1987-2006.
(b) 1985-2004.
(c) 1980-2000.
(d) 1990-1999.

7. According to the author, what philosophy translates to "My facts are facts and your facts are not facts"?
(a) "Consumerism."
(b) "Capitalism."
(c) "Objective reality."
(d) "Republican realism."

8. Alongside what Presidential nominee did Sarah Palin run as Vice President of the United States?
(a) George W. Bush.
(b) John McCain.
(c) Barack Obama.
(d) Hillary Clinton.

9. For what political party was Sarah Palin the nominee for Vice President of the United States?
(a) Republican.
(b) Tea Party.
(c) Democrat.
(d) Green Party.

10. AIG was listed on the Dow Jones Industrial Average from _________ to September 22, 2008.
(a) March 12, 2008.
(b) September 19, 2005.
(c) April 8, 2004.
(d) August 5, 2003.

11. What involves an exchange of the defaulted loan instrument (and with it the right to recover the default loan at some later time) for immediate money - usually the face value of the loan?
(a) Credit default swap.
(b) Derivatives.
(c) Free trade.
(d) Tranch default swap.

12. In Chapter 3, what process in which loans are split up and sold off to secondary investors as securities was used by banks?
(a) Amortization.
(b) Authorization.
(c) Securitization.
(d) Derivatives.

13. According to the author, the Tea Party believes that the economy is self-correcting as long as commerce and _______ are separated.
(a) Business.
(b) Government.
(c) Socialism.
(d) Derivatives.

14. What refers to the part of the economy which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state?
(a) Private sector.
(b) Education system.
(c) Public sector.
(d) Stock market.

15. In Atlas Shrugged, a group of men break off on their own and form __________.
(a) A free-market society.
(b) A dystopian society.
(c) A Socialist society.
(d) A Communist society.

Short Answer Questions

1. When did Lehman Brothers declare bankruptcy?

2. What refers to an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities?

3. Of what political party was Ronald Reagan a member?

4. Who was Vice President to Richard Nixon?

5. What does NINJA stand for in the mortgage industry?

(see the answer keys)

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