When Genius Failed Test | Mid-Book Test - Hard

Roger Lowenstein
This set of Lesson Plans consists of approximately 99 pages of tests, essay questions, lessons, and other teaching materials.

When Genius Failed Test | Mid-Book Test - Hard

Roger Lowenstein
This set of Lesson Plans consists of approximately 99 pages of tests, essay questions, lessons, and other teaching materials.
Buy the When Genius Failed Lesson Plans
Name: _________________________ Period: ___________________

This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.

Short Answer Questions

1. Who gains from working with hedge funds?

2. Who did most funds have to be registered with?

3. Michael Steindardt believed what was the "culprit in 1994"?

4. What did Long-Term do when IOs started to fall?

5. What company was Kapor the founder of?

Short Essay Questions

1. What did the Black-Scholes model help Long-Term to predict?

2. On what did Long-Term base the claim that it was difficult to lose money with them?

3. Why was it difficult to know the exact amount of assets Long-Term held?

4. What are relative value trades?

5. Why did Meriwether begin recruiting employees he had worked with at the Arbitrage Group?

6. Why was Meriwether made a partner at Salomon?

7. By the time Long-Term had been in business for two years, how did it compare to other old Wall Street companies?

8. Why did hedge funds make money for managers?

9. What surprise happened when Meriwether was trading Treasury Bill futures?

10. When additional investors returned to the Italian market, what did Long-Term do?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

As Long-Term became more and more successful, many banks and investment firms were eager to work with the company. Examine the various ways banks and investment firms offered advantages to Long-Term and why.

Essay Topic 2

The investment requirements of Long-Term were quite stringent. Citing examples from the text, write an essay examining the investment requirements and opportunity for return for potential Long-Term investors.

Essay Topic 3

When Long-Term was faced with financial turmoil, it took only five weeks for it to lose staggering amounts of money. Examine the following points:

1) What was the financial profile of Long-Term prior to Russia's debt default?

2) What did the financial profile change so drastically?

3) What moves did Long-Term make to correct the situation and why were they ineffective?

(see the answer keys)

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