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

Multiple Choice Questions

1. What does Union Pacific announce that dismays Livingston?
(a) Plans for new railroads.
(b) A dividend.
(c) Bankruptcy filings.
(d) A company reorganization.

2. What does Livingston say one must be in order to be a good trader?
(a) Very smart and well educated.
(b) Objective and neutral.
(c) Subjective.
(d) Intuitive.

3. How long does Livingston stay in Boston the second time he goes there?
(a) Two years.
(b) A year.
(c) Six months.
(d) Two weeks.

4. What does Livingston conclude when Union Pacific announces a dividend?
(a) The stock is worthless.
(b) He had read the insiders correctly.
(c) They are borrowing money from somewhere.
(d) The company is poorly run.

5. How does Livingston feel about the amount of money he's making?
(a) He's indifferent, he just likes to play the market.
(b) It's lousy.
(c) It's very good.
(d) It's not what he expected.

6. What does Livingston discuss at the beginning of this chapter about stocks?
(a) How stocks come in all sizes.
(b) How one stock is good and one isn't.
(c) Various patterns.
(d) How it's all random.

7. What does Livingston believe about the cotton market when he and Percy are discussing it?
(a) It's a bear market.
(b) It's a bull market.
(c) It's a dull market.
(d) It's too volatile.

8. What happens when one places an order on Wall Street time wise?
(a) There is a short lag.
(b) The SCCI has to check it first.
(c) It's never implemented for 24 hours.
(d) It is done instantly.

9. Why did Livingston stop in New Haven on his way to New York?
(a) To bet in a bucket shop.
(b) To see his brother.
(c) To see his mother.
(d) To take a job.

10. According to Livingston why should no one trade every day?
(a) It is too tiring.
(b) The excitement leads to mistakes.
(c) It's not good for the soul.
(d) It cost too much money.

11. Why should a trader start with a small trade?
(a) To see what others are doing.
(b) To find out if the stock is viable.
(c) So he'll lose less money.
(d) To see if it's going in the right direction.

12. Why is corn having a hard time getting to the market?
(a) Due to the roads.
(b) Due to government regulations.
(c) Due to a union stike.
(d) Due to the weather.

13. How do some smaller exchanges double their money?
(a) Taking out too much taxes.
(b) Allowing margin play.
(c) Switching prices at the last minute.
(d) Getting different customers to buy and sell at the same time.

14. When is there a financial panic in 1907?
(a) October.
(b) August.
(c) April.
(d) June.

15. What does Livingston do when the alternate exchanges start to try and manipulate him?
(a) He calls the police.
(b) He buys the exchange.
(c) He quits and goes to New York.
(d) He starts reverse manipulations.

Short Answer Questions

1. What does it take to be one of the best traders?

2. Why is it harder for alternate exchanges to get rid of a customer?

3. When can one only sell stock?

4. What does the pattern ignore that can create a problem?

5. How does Livingston portray himself to the small exchanges?

(see the answer keys)

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