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This quiz consists of 5 multiple choice and 5 short answer questions through Prologue and Chapter 1.

Multiple Choice Questions

1. What refers to a cumulative number that suggests a consumer's credit risk?
(a) Tranches.
(b) Collateral debt obligation.
(c) Credit default swap.
(d) FICO Score.

2. With whose assistance did Steve Eisman publish a report outlining the bad practices of the subprime mortgage lender in Chapter 1?
(a) Vincent Daniel's.
(b) Greg Lippmann's.
(c) Michael Lewis'.
(d) Meredith Whitney's.

3. Meredith Whitney was an analyst of financial firms for what company in 2007?
(a) Household Finance Corporation.
(b) Salomon Brothers.
(c) Citigroup.
(d) Oppenheimer and Co.

4. Steve Eisman discovered that what company was fraudulently selling fifteen year mortgages under the guise of thirty year mortgages?
(a) The Fitch Group.
(b) Gotham Capital.
(c) Household Finance Corporation.
(d) Salomon Brothers.

5. With the creation of ______, mortgage companies became inspired to grow quickly and offer a great many loans to customers.
(a) Mortgage bonds.
(b) Moody's.
(c) Standard & Poor's.
(d) FICO Scores.

Short Answer Questions

1. What are bonds that are made up of mortgages sold to consumers by banks?

2. When was Michael Lewis born?

3. What is the name of the investment group Steve Eisman formed after quitting his job as a bond analyst?

4. In finance, what occurs when a debtor has not met his or her legal obligations according to the debt contract?

5. Where did Michael Lewis work as a bond salesman after earning his Masters degree in Economics?

(see the answer key)

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