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This quiz consists of 5 multiple choice and 5 short answer questions through Part 1: Chapter 5, The Cloister at Wilshire and Rodeo.

Multiple Choice Questions

1. What commission did Drexel make on these funds?
(a) seven eighths of a percent
(b) one percent
(c) three quarters of a percent
(d) five eighths of a percent

2. What were Milken's results the first year in his new position at Drexel Burnham?
(a) 100% profit
(b) 10% profit
(c) Fewer clients
(d) Break even

3. Keeping New York office hours, at what time did they begin work in L. A.?
(a) 6:30 a.m.
(b) 7:00 a.m.
(c) 10:00 a.m.
(d) 4:30 a.m.

4. What did Milken offer this market segment?
(a) ten cents on the dollar
(b) a hope for recovery
(c) a new kind of debt instrument
(d) a protection from takeover

5. What was the result of changes in the investment banking industry in the 1970s?
(a) Regulations now made it harder to trade in junk bonds.
(b) Business concentrated in New York and Los Angeles.
(c) Many new firms came into existence and were soon taken over.
(d) Firms became highly competitive and business moved around.

Short Answer Questions

1. What was the average net worth of members of Milken's core group after being with him five years?

2. What was the Wall Street attitude toward low grade bonds at the time Milken started trading in them?

3. What was HITS?

4. What advantage did Milken's kind of debt offer?

5. What did the Milken Group do in 1983?

(see the answer key)

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