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

Multiple Choice Questions

1. In 1998, what type of contracts did Long-Term make with private entities?
(a) Short-term.
(b) Illegal.
(c) Long-term.
(d) Liquid.

2. How was Meriwether's career affected following the Treasury bill deal?
(a) He became a regulation advocate.
(b) He was made partner.
(c) He lost his job.
(d) He became a public speaker.

3. In order for Meriwether's Treasury futures investment to work, what did he need market prices to do?
(a) Fluctuate drastically.
(b) None of these.
(c) Converge.
(d) Remain the same.

4. After the financial crisis in Russia, what did Long-Term regret?
(a) All of these.
(b) Creating deals that were not liquid.
(c) Forcing investors to take back money.
(d) Creating private deals.

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

Short Answer Questions

1. During the turmoil of 1998, investors avoided Long-Term because they were trying to avoid what?

2. What was the climate at Long-Term during the Russian financial crisis?

3. Who suspended arbitrage operations in April 1998?

4. When Russia began to default on its loans, what did people start doing with their high risk bonds?

5. What did banks and investors want from Long-Term?

(see the answer key)

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