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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. In whose garage did Charlie Ledley begin operating a hedge fund in Chapter 5?
(a) Mike Burry's.
(b) Steve Eisman's.
(c) Greg Lippmann's.
(d) Jamie Mai's.

2. What is the title of Chapter 5?
(a) The Blind Investors.
(b) Accidental Capitalists.
(c) A Lucky Fortune.
(d) Wall Street Rookies.

3. With Ben Hockett's help, Cornwall received a contract which allowed them to buy what?
(a) CDSs.
(b) ISDAs.
(c) FICOs.
(d) CDOs.

4. The woman who stated that her supervisors picked and chose which mortgage bonds would be triple-A rated despite her frequent recommendations that most of them be downgraded worked for what company in Chapter 4?
(a) Deutsche Bank.
(b) Standard & Poor's.
(c) Moody's Corporation.
(d) Wachovia.

5. Who agreed to a $5 million dollar deal with Michael Burry in Chapter 2?
(a) Cornwall Capital Management.
(b) Scion Capital
(c) Goldman Sachs.
(d) Bank of America.

Short Answer Questions

1. In Chapter 5, Charlie Ledley and Jamie Mai continued to make risky investments until they had grown their investment company to how much?

2. What is the name of the investment group begun by Charlie Ledley and his partner in Chapter 5?

3. The alterations to bond ratings made by mortgage lenders in Chapter 4 led to such things as lending how much money to a migrant worker who made only $14,000 a year?

4. For what company did Michael Lewis begin working after earning his Masters degree in Economics?

5. What refers to loans made to customers with less than perfect credit?

Short Essay Questions

1. What did Vincent Daniel discover about the ratings companies in Chapter 4?

2. What led to mortgage companies extending loans to unreliable clients, as described in Chapter 1?

3. How does the author describe his impressions of Wall Street when he began working there in Chapter 1?

4. How did Greg Lippmann believe he could make a fortune in the subprime mortgage industry in Chapter 3?

5. How do stocks and bonds differ in trading?

6. What intrigued Steve Eisman about CDSs in Chapter 3?

7. How are tranches differentiated in mortgage bonds?

8. How did Steve Eisman come to work for Oppenheimer Co.? How is he described?

9. How did Greg Lippmann go about finding investors in Chapter 3?

10. What picture does the author paint of Steve Eisman and Wall Street in 2005 in Chapter 1?

(see the answer keys)

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