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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 Milken's people say they performed so well?
(a) because he would accept nothing less
(b) because they were maing so much money
(c) because they learned from the King
(d) because they had to get up so early

2. What did Milken refuse to have in the Drexel annual report?
(a) a description of his operation
(b) his photo and the organization of his staff
(c) his letter to the shareholders
(d) the names of his staff

3. For whom did Milken do trading?
(a) only for family and friends to keep attention away from himself
(b) just for Drexel Burnham Lambert because of the volume of work
(c) only for himself now because he was making so much money
(d) not only for customers, but also his own account and his group's account

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

5. To troubled businesses, what was Drexel's unregistered exchange offer?
(a) creating additional Chinese paper
(b) a way of using stocks or bonds to meet the interest obligations
(c) lowering their interest rates to businesses
(d) trading under the table

Short Answer Questions

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

2. How did the firm now have equity stakes in most of the companies that it financed?

3. When were the tax laws changed to minimize the benefits of stripping?

4. What was HITS?

5. What was Milken's problem with back office people at Drexel?

(see the answer key)

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