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This test consists of 5 multiple choice questions, 5 short answer questions, and 10 short essay questions.

Multiple Choice Questions

1. Hank Paulson and his staff prepared a secret plan for how to deal with the situation in Chapter 4. Their plan proposed that should the banks fail, the Treasury Department would purchase up to how many of the bad assets of the banks in order to stabilize the market?
(a) $100 billion
(b) $300 billion
(c) $200 billion
(d) $500 billion

2. Who was Dick Fuld’s Chief Strategy Officer in Chapter 6?
(a) Jim Cramer
(b) David Goldfarb
(c) Lloyd Blankfein
(d) John F. Rogers

3. In what year did Hank Paulson become a partner at Goldman Sachs?
(a) 1979
(b) 1985
(c) 1989
(d) 1982

4. Who was the Chairman of the Federal Reserve in 2008?
(a) Jim Bunning
(b) Ben Bernanke
(c) Jon Corzine
(d) Michael Bloomberg

5. Bob Willumstad was a third-generation son of immigrants from where?
(a) Poland
(b) Norway
(c) Germany
(d) Iceland

Short Answer Questions

1. Hank Paulson joined Goldman Sachs covering large industrial companies in the Midwest in what year?

2. Where was the hedge fund Peloton based?

3. What does AIG stand for?

4. AIG began with what name in a small office in Shanghai in 1919?

5. Who was the founder of the company that would become AIG?

Short Essay Questions

1. To whom did John Thain turn for help with Merrill Lynch’s situation in Chapter 7? What response did he receive?

2. How does the author describe David Einhorn in Chapter 5?

3. For what reason was Hank Paulson angry when he heard about the JP Morgan and Bear Stearns deal in Chapter 2?

4. What executive meeting does the author describe in the opening of Chapter 9? Where did the meeting take place?

5. What was the impact of David Einhorn’s speech regarding Lehman Brothers’ assets in Chapter 5?

6. What suggestion did Hank Paulson make to Dick Fuld regarding Lehman Brothers’ holdings in Chapter 2? How did Fuld respond?

7. How does the author describe AIG’s establishment and history in Chapter 8?

8. What advice did Skip McGee give to Dick Fuld in Chapter 6? How did Fuld respond?

9. What decisions came out of the meeting described in Chapter 9?

10. How was Hank Paulson’s rise to the post of Treasury Secretary described in Chapter 2?

(see the answer keys)

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