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

Multiple Choice Questions

1. Why did Milken hold a mini-Predators' Ball in Tokyo?
(a) He was invited by Japanese businessmen.
(b) The Balls in Los Angeles were drawing too much publicity.
(c) He did things like that on a whim.
(d) He was looking at getting into foreign markets.

2. What concept did Milken continue to support?
(a) the switch to high-yield securities
(b) the legality of takeovers
(c) the owner-manager of businesses
(d) the cautions of using junk bonds

3. Who made the contact for Wedvick with Kansa?
(a) Rodrigo Rocha
(b) Carl Icahn
(c) Fred Joseph
(d) Michael Milken

4. On May 12, 1986, who was charged with insider trading and agreed to cooperate with the government?
(a) Lowell Milken
(b) Fred Joseph
(c) Dennis Levine
(d) Car Icahn

5. What happened to the blue-chip investors Drexel was trying to attack?
(a) They did not stay with the firm.
(b) They took a wait and see stance.
(c) They rallied in support of Drexel.
(d) They kept coming for Drexel help anyway.

6. What did Grant say the public was competing for at that point?
(a) for securities of high and higher yield - and poorer quality
(b) for ownership in television stations and newspapers
(c) for more and more media attention
(d) for invitations to the Preditors' Ball

7. What were many of the money managers who started with Milken in the late 1970s doing in the 1980s?
(a) staying with Milken because he was the best
(b) running their own funds
(c) creating new ways of financing takeovers
(d) retiring and taking extended vacations

8. What did Drexel think about the Japanese acceptance of junk bonds used in takeovers?
(a) that they would need to do a lot of educating
(b) much faster there than it had been in the United States
(c) that the Japanese would accept anything made in America
(d) that it would be a foothold in all of Asia

9. For whose benefit were most of the investment partnerships?
(a) for Milken
(b) for the corporate employees
(c) for the Drexel firm
(d) for potential clients

10. What was coming to an end?
(a) Drexel's presence on Wall Street
(b) Drexel's plans for selling the firm
(c) Milken's ability to raise millions of dollars in a few days
(d) Milken's anonymity

11. To Drexel, what did certain concessions to clients mean?
(a) a bad reputation among other investors
(b) having clients indebted to them
(c) very little because they were so big
(d) more deals and more money down the road

12. What was the subject of debate in the mid 1980s during the M&A onslaught?
(a) the dangers of over growth
(b) the legality of hostile takeovers
(c) the cash flow of takeovers
(d) the economic advantages of takeovers

13. How did the investigation appear at first?
(a) It seemed impossible to find all the needed evidence.
(b) It seemed to involve Wall Street figures other than Milken and Drexel.
(c) It seemed flimsy and not much to worry about.
(d) It seemed to be only aimed at Milken.

14. Before Sigoloff switched to Drexel, who was handling his takeover bid for Wickes?
(a) Lehman Brothers
(b) Merrill Lynch
(c) Salomon Brothers
(d) Morgan Stanley

15. What made Drexel's troubles even worse after Boesky Day?
(a) The firm was hated by many on Wall Street.
(b) The FBI wiretapped Milken's and Drexel's offices.
(c) Both New York and California started independent investigations.
(d) The firm defaulted on its building mortgage.

Short Answer Questions

1. Where did Grant point out most of the junk bonds were held?

2. How did Perelman acquire Technicolor?

3. What did Grant continue to predict?

4. What happened to the plan for moving to the Seven World Trade Center?

5. What had been Perelman's greatest acquisition before Revlon?

(see the answer keys)

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