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This quiz consists of 5 multiple choice and 5 short answer questions through Part 1: Chapter 3, Transformation.

Multiple Choice Questions

1. How did Milken break into the Las Vegas gambling business community?
(a) Milken showed the casino owners how they could double their income.
(b) Milken lowered his commissions to get large casino business.
(c) Milken traveled every weekend to gamble in Las Vegas.
(d) Milken helped Steve Wynn raise the funds he needed to build in Atlantic City.

2. Why did Drexel have to separate from J. P. Morgan?
(a) the enactments of the Glass-Steagall Act in 1934
(b) the final break up of J. P. Morgan and Company
(c) a disagreement between Drexel and Morgan
(d) the regulations of the sherman Anti-Trust Act

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

4. What was the address of the new building in L. A.?
(a) Avenue of the Stars in Century City
(b) Hollywood and Vine
(c) Rodeo Drive and Wilshire
(d) Sunset and Vine

5. What was the Wall Street attitude toward low grade bonds at the time Milken started trading in them?
(a) They were looked down on.
(b) They were unknown to Wall Street.
(c) Then were used for scratch paper.
(d) They were used as charitable donations.

Short Answer Questions

1. What was it about Milken that impressed his clients?

2. What did Milken offer this market segment?

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

4. Who dominated the market in junk bond funds from 1978 on?

5. What are REITs?

(see the answer key)

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