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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. 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?
(a) $150 thousand.
(b) $350 thousand.
(c) $700 thousand.
(d) $500 thousand.

2. Where did Michael Lewis earn his Masters degree in Economics?
(a) The Paris School of Economics.
(b) The London School of Economics.
(c) The Chicago School of Economics.
(d) The New York School of Economics.

3. What majority-owned subsidiary of Fimalac, S.A., is a global rating agency dedicated to providing value beyond the rating through independent and prospective credit opinions, research and data?
(a) Deutsche Bank.
(b) Wachovia.
(c) The Fitch Group.
(d) Standard & Poor's.

4. Steve Eisman got his job with Oppenheimer and Co. through whom?
(a) His uncle..
(b) His neighbor.
(c) A friend from college.
(d) His parents.

5. Who offered Michael Burry bonds at $100 million a deal in Chapter 2?
(a) Deutsche Bank.
(b) Oppenheimer and Co.
(c) Goldman Sachs.
(d) Bank of America.

Short Answer Questions

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

2. The sale of CDSs grew AIG FP so quickly that it provided what percent of AIG's profits in Chapter 3?

3. What is often referred to as a form of insurance that protects a lender if a borrower of capital defaults on a loan?

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?

5. In what year did Steve Eisman stop working as an analyst and start his own hedge fund?

Short Essay Questions

1. How did Charlie Ledley's first investment pay out? What was the company's worth?

2. What led Steve Eisman to open his own hedge fund?

3. Who was the only person at AIG FP to investigate the company's CDSs in Chapter 4? What did he discover?

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

5. How do stocks and bonds differ in trading?

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

7. With whom did Charley Ledley work in New York? What individual did he meet from Berkeley, California in Chapter 5?

8. How are AIG FP's actions described in Chapter 3?

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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