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This quiz consists of 5 multiple choice and 5 short answer questions through Part 3: Chapter 17, The Humbling.

Multiple Choice Questions

1. What could happen to Drexel with so much power vested in one man?
(a) possible loss if anything happened to him
(b) possible take over of the company
(c) possible abuse of power
(d) possible collapse of the company

2. What was HITS?
(a) Hard Investment Trade Secrets
(b) a government investigation agency
(c) High Interest Tax Service
(d) a high yield mutual fund that Drexel formed

3. What was Milken's biggest contribution to Drexel in the early years?
(a) engineering the change over to computers
(b) a study of the securities delivery system which cut the delivery time from five days to one
(c) a recruiting system to get the brightest Ivy League graduates
(d) an entry into the social circles of high-yield bond traders

4. What did Milken demand from everyone around him?
(a) that they call him Mr. Milken
(b) things done the way he wanted them done
(c) more money for his services
(d) any information they overheard

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

Short Answer Questions

1. What was the largest bankruptcy in 1986?

2. What was the address of the new building in L. A.?

3. Who did Joseph hire with a three-year contract calling for $3 million per year plus extras?

4. With whom was the firm of Drexel Burnham Lambert identified by the late 1970s?

5. What did the 1985 President's Council of Economic Advisers report on the issue of M&A conclude?

(see the answer key)

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