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

Multiple Choice Questions

1. What did the Black-Scholes model believe was constant?
(a) Volatility.
(b) Meriwether's enthusiasm.
(c) Growth.
(d) Income.

2. What was the result for some banks due to their involvement in the derivatives market?
(a) They were prosecuted.
(b) They made billions.
(c) They were nationally recognized.
(d) They went bankrupt.

3. By the end of 1996, what was the status of the credit financing Long-Term wanted?
(a) They still did not have it.
(b) They had financing.
(c) All of these.
(d) No one would finance them.

4. In its first bad year, what did Long-Term maintain?
(a) A great workforce.
(b) All of these.
(c) A good reputation.
(d) A strong energy.

5. In 1997, who awarded Long-Term the loan warrant it had requested?
(a) The Cayman Islands Commons.
(b) Bank of America.
(c) Chase.
(d) Union Bank of Switzerland.

Short Answer Questions

1. When Russia first experienced turmoil, Long-Term was confident that what would happen?

2. What regulation did Long-Term bypass when trading equities?

3. Who became the temporary CEO of Meriwether's group when scandal hit?

4. Who suspended arbitrage operations in April 1998?

5. In 1998, what were many hedge funds selling insurance against?

(see the answer key)

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