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This quiz consists of 5 multiple choice and 5 short answer questions through The Fall.

Multiple Choice Questions

1. What hedge fund caused a pound devaluation in Europe but made over a billion dollars?
(a) Quantum Fund.
(b) Endowment Fund.
(c) Millenium Fund.
(d) Treasury Fund.

2. In 1996, who did Long-Term first approach to handle their credit?
(a) Washington Mutual.
(b) Bank of America.
(c) Citibank.
(d) Chase.

3. What did the Fed Chairman want to remove in an effort to create liquidity in the market?
(a) Trading rules.
(b) Stock rules.
(c) Margin rules.
(d) Short rules.

4. What was Long-Term's signature trade?
(a) The "mort up".
(b) The "shining cat".
(c) The "small build".
(d) The "equity vol".

5. In 1996, why was it difficult to continue to find strong profits in arbitrage trades?
(a) The market did not have enough players.
(b) It was illegal to perform these trades.
(c) Long-Term did not have investment capital.
(d) The market was over-saturated.

Short Answer Questions

1. Meriwether believed that risk and volatility were what?

2. Who helped Meriwether raise money for Long-Term?

3. In 1996, what was Long-Term seeking from the bank that would handle their credit?

4. How much money did Rosenfeld's business bring in?

5. In 1998, what act led Long-Term to a fall?

(see the answer key)

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