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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. What did Joseph label his brainstorming information about LBOs?
(a) the M&A files
(b) the X-Files
(c) the CIA files
(d) Air Fund or the highly confident letter

2. What was one thing Lowell Milken did for the company?
(a) make political contacts
(b) make the coffee
(c) keep out unwanted visitors
(d) find tax shelters for them

3. What was the average net worth of members of Milken's core group after being with him five years?
(a) $20 million
(b) $12 million
(c) $10 million
(d) $5 million

4. Why did Drexel Burnham Lambert agree to let Milken move his operation at a cost of millions of dollars?
(a) Milken was then major stock holder in the company.
(b) Milken was responsible for almost all of the firm's profits.
(c) Milken had some inside information he could use in L. A.
(d) Milken threatened to leave.

5. Why was Milken nervous about the large deals?
(a) because of the drain on Drexel finances
(b) because of the economy
(c) because of the people running the companies
(d) because of the size

6. To find more ways for their clients to make money, to what did Milken and Joseph turn their attention?
(a) offshore banking
(b) mergers and acquisitions
(c) financial planning
(d) entertainment properties

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

8. Where did most of the money come from when Icahn actually acquired ACF, a railroad car leasing company?
(a) Ichan sold all of his Milken junk bonds.
(b) Ichan got the money from his uncle.
(c) Much of the purchase price came from the sale of some of the company's divisions.
(d) Milken financed much of the price.

9. What are REITs?
(a) rare employee investment tallies
(b) real estate instruments like mortgages
(c) raw energy investment tables
(d) really extended investment trials

10. Where did Milken want to move his bond operation unit in 1978?
(a) Las Cruces
(b) Los Angeles
(c) Los Alamos
(d) Las Vegas

11. Why was Milken so interested in low grade bonds?
(a) that was all he could afford
(b) equity offerings were not an option for the Drexel Burnham market
(c) they were the only ones he really understood
(d) he liked to gamble big time

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

13. Where did Milken and his wife buy a house?
(a) San Clemente
(b) Beverley Hills
(c) Santa Monica
(d) Encino

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

15. What was Milken's goal by the early 1970s?
(a) He wanted to move into high-yield bonds.
(b) He wanted low-yield bonds to be its own specialty.
(c) He wanted to own Drexel Burnham.
(d) He wanted to have his own firm.

Short Answer Questions

1. What is a proxy fight?

2. Who made the acquisition in the American Natural Resources (ANR) case?

3. Who was another player involved in the National Can takeover attempt?

4. What was the purpose of Fred Joseph's meeting at the Barbizon Plaza in New York?

5. Where was much of the money coming from for takeovers in the 1980s?

(see the answer keys)

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