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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. According to the author, many loans were _____ meaning there was no documentation that confirmed their qualifications for the loans.
(a) "No doc."
(b) "On spec."
(c) "No trans."
(d) "Insecure."

2. During what years was Ronald Reagan President of the United States?
(a) 1979-1985.
(b) 1971-1978.
(c) 1982-1990.
(d) 1981-1989.

3. What are created when banks split their mortgage loan payments into three levels and sell them in separate packages?
(a) Tranch blocks.
(b) Incidentals.
(c) Derivatives.
(d) Collectives.

4. The fundamental belief of what philosophy is that self-interest is a normal human state and interventionism by the government is unnatural and evil?
(a) Pluralism.
(b) Subjectivism.
(c) Objectivism.
(d) Absurdism.

5. Eljon Williams learned that the firm which helped him obtain a mortgage had gotten a commission of how much money?
(a) $10,000.
(b) $5,000.
(c) $12,000.
(d) $8,000.

Short Answer Questions

1. Eljon Williams contacted what firm to help him get a home loan with a fixed mortgage?

2. What NBC correspondent did Alan Greenspan marry?

3. What refers to trade in high volumes at prices that are considerably at variance with intrinsic values?

4. During his economic studies, Alan Greenspan worked under Eugene Banks, a managing director at what Wall Street investment bank?

5. What is a private, actively managed investment fund that utilizes sophisticated strategies in international and/or domestic markets, offsets losses during a market downturn, and/or generates returns higher than traditional stock and bond investments?

Short Essay Questions

1. What does Taibbi write of his thoughts on Sarah Palin in Chapter 1?

2. How did the public and private sectors evolve and change during Alan Greenspan's reign of the Federal Reserve, as described in Chapter 2?

3. What campaign strategy of Richard Nixon's does Taibbi describe in Chapter 1?

4. What does Taibbi assert was at the root of the 2008 financial crisis?

5. As described in Chapter 2, what was Alan Greenspan's focus in controlling the United States economy?

6. How does the author relate Alan Greenspan's methods with those of a casino?

7. Where was Ayn Rand from? How is she described in Chapter 2?

8. How did Greenspan's views of American politics change over time?

9. How did Ayn Rand influence Alan Greenspan, and in effect, American finance?

10. How did the market for subprime loans change between 2002 and 2005?

(see the answer keys)

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