2. How did bondholders often operate in noncompliance with SEC rules?
(a) selling bonds before they were registered
(b) not declaring income from bond sales
(c) secrecy in the bond market
(d) overstating the values of bonds

3. By 1983, what was the worth of Drexel's junk bond business?
(a) $460 billion
(b) $2 billion
(c) $4.690 billion
(d) $40 billion

4. What did the Federal Home Loan Bank Board discover about what Spiegle at Columbia Savings and Loan was doing?
(a) using Columbia Savings and Loan money to finance his own investments
(b) financing his junk bond purchases with federally insured funds
(c) making fictitious home loans
(d) manipulating his competitors out of business

5. Why did the stripped bonds result in large tax benefits?
(a) those sales did not have to be reported as income
(b) without the coupons the securities were untraceable
(c) no law covered the stripped Treasury security
(d) stripping the securities left them worthless

6. What is it called when a firm decides to commit its own capital toward a takeover?
(a) marginal financing
(b) bridge financing
(c) piggybacking
(d) highway financing

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

8. What was the goal of Nelson Peltz?
(a) to compete with Milken
(b) to get into the airline business
(c) to be a part of the Hollywood scene
(d) to corner the Los Angeles real estate market

9. What did Carl Ichan become known as?
(a) losing proxy fights
(b) a takeover specialist, especially hostile takeovers
(c) going bankrupt
(d) a movie mogul

10. Who moved to Los Angeles with Milken?
(a) most of his staff
(b) several Wall Street firms
(c) most of his friends
(d) most of his relatives

11. What was the object of gaining control of a company and sell off many of its divisions?
(a) to be left with the best part of the company almost for free
(b) to avoid reporting where the purchas price was coming from
(c) to make money on the sales and then dump the parent company
(d) to bring the bought company down to manageable size

12. Who was behind the success of both First Executive and Columbia Savings?
(a) Thomas Spiegle
(b) Fred Carr
(c) Mike Milken
(d) Lowell Milken

13. 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 easier to use than getting a bank loan.
(d) It was separate from bank loans and the bondholder could sell his bonds whenever he wanted

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

15. What was the purpose of Fred Joseph's meeting at the Barbizon Plaza in New York?
(a) gathering inside information to take back to Los Angeles
(b) consideration of all ideas, even the far-out and the flamboyant, instead of the conservative
(c) pirating talent from some of the biggest firms on Wall Street
(d) to undermine Milken and take over control of the Department