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

Multiple Choice Questions

1. Of whom does Livingston make fun?
(a) The press.
(b) Brokage firms.
(c) Traders and the public looking for tips.
(d) Commodity traders.

2. What does any trade do to the price of a stock?
(a) Nothing.
(b) If selling the price goes up.
(c) Affects it.
(d) If buying the price goes down.

3. What is one of the forces that can cause a stock spectator's plans to go awry?
(a) The trader calling in sick on the best day to sell.
(b) A company collapsing.
(c) The government changing regulations.
(d) Forces inherent in the market.

4. When does Livingston hate losing money the most?
(a) When he follows someone's tip.
(b) When another trader manipulates him into the loss.
(c) When he needs money for a stake.
(d) When he does everything right.

5. What does Imperial Steel give Livingston as compensation?
(a) Twenty-five thousand shares.
(b) A seat on the board of directors.
(c) One hundred thousand shares.
(d) A half a million dollars.

6. What does everyone finally think about Tropical Trading?
(a) The stock is solid.
(b) The parent company is in trouble.
(c) The stock can't be manipulated.
(d) The insiders are dishonest.

7. What does Livingston believe about this famous stock manipulator?
(a) That he should have been arrested.
(b) That he broke the law many times.
(c) That he would be successful anytime.
(d) That he was a scoundrel.

8. To what does Livingston attribute his success?
(a) Being willing to lose lots of money.
(b) Objectively watching stocks.
(c) Being in the right place at the wrong time.
(d) Having a lot of friends.

9. What does he think his debts are doing to his trading?
(a) Making it too hard to borrow money.
(b) Causing him to be less objective.
(c) Making him too cautious.
(d) Making it impossible to play on a margin.

10. What does Livingston do to prevent being broke again?
(a) He puts some of his money in municipal bonds.
(b) He sends half his money to his brother to hold for him.
(c) He opens a large savings account.
(d) He puts money into annuities.

11. What does Livingston say a trader needs to make a good decision?
(a) To have good instincts.
(b) To have a lot of money backing him.
(c) To work for a good brokerage firm.
(d) To know a stock really well.

12. What has the market done about charlatans since Livingston has been trading?
(a) Tells the newspapers what stocks are bad.
(b) Nothing.
(c) Weeds them out.
(d) Has them arrested.

13. Why does Livingston say traders are often vilified in the press and by other traders?
(a) When they corner a market.
(b) When they sell short and the price drops.
(c) When they hold onto food crops.
(d) When they make too much money.

14. What happens after Livingston's initial action on behalf of Imperial Steel?
(a) The price bottomed out.
(b) Brokers begin buying their stock.
(c) The price slid slightly.
(d) The newspaper reported the company was failing.

15. Where does Livingston go after the dealings with Percy?
(a) Washington D.C.
(b) Atlanta.
(c) Chicago.
(d) Boston.

Short Answer Questions

1. When Livingston is looking at the price of Tropical Trading what is the market doing?

2. What does an operator tell people when cornering a market?

3. How does Livingston drive up the price of Consolidated Stove?

4. What does Livingston think one should never feel about the market?

5. Who was a famous stock manipulator Livingston mentions?

(see the answer keys)

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