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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. What two large companies did Drexel underwrite bond issues for in a ten-day period?
(a) Boeing Aricraft and United Supermarkets
(b) Paramount Pictures and General Motors
(c) Disney Studios and the LA Dodgers
(d) MGM/UA Entertainment Company and MCI Communications

2. 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 was easier to use than getting a bank loan.
(c) It did not tie up cash the way loan repayments did.
(d) It was separate from bank loans and the bondholder could sell his bonds whenever he wanted

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

4. What did Milken and Joseph devise to keep business flowing during the recession?
(a) better communications with clients
(b) different kinds of instruments
(c) finance services for the largest clients
(d) ways of trading abroad

5. Who was Dr. Feelgood of Drexel?
(a) Fred Joseph
(b) Tubby Burnham
(c) Lowell Milken
(d) Michael Milken

Short Answer Questions

1. Why did Drexel remain a privately-held company?

2. What did the Milken brothers do probably without notifying Drexel?

3. What was Fred Joseph's strategy for hiring employees for Drexel?

4. What was Milken's goal by the early 1970s?

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

(see the answer key)

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