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This quiz consists of 5 multiple choice and 5 short answer questions through Part 1: Chapter 6, The Air Fund.

Multiple Choice Questions

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

2. Why was Drexel Burnham's investment banking business diminished by 1975?
(a) It had nothing to sell.
(b) The bigger firms were copying its business model.
(c) Most of the major customers had fled.
(d) Bond prices had risen too high.

3. Who becomes Milken's ally and public face in 1974?
(a) Khun Loeb
(b) Tubby Burnham
(c) Cary Grant
(d) Fred Joseph

4. What was the estate they bought?
(a) the Judy Garland estate
(b) the Clark Gable-Carole Lombard estate
(c) the Pickford estate
(d) the Jackie Coogan estate

5. What advantage did Milken's kind of debt offer?
(a) It was done under the table so the banks did not know about it.
(b) It did not tie up cash the way loan repayments did.
(c) It was separate from bank loans and the bondholder could sell his bonds whenever he wanted
(d) It was easier to use than getting a bank loan.

Short Answer Questions

1. How did Milken break into the Las Vegas gambling business community?

2. What does FIFI stand for?

3. Why was Milken nervous about the large deals?

4. Who was Dr. Feelgood of Drexel?

5. By 1983, what was the worth of Drexel's junk bond business?

(see the answer key)

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