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

Short Answer Questions

1. What were the models Long-Term used unable to predict?

2. What did Long-Term do with off-the-run bonds?

3. In order for Meriwether's Treasury futures investment to work, what did he need market prices to do?

4. How many employees were with Long-Term in 1996?

5. What models did Long-Term follow?

Short Essay Questions

1. What were the legal limits on hedge fund investors?

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

3. What dictates whether or interest only securities rise or fall?

4. When Meriwether was building his team at the Arbitrage Group, what qualities did he look for?

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

6. Why was Meriwether made a partner at Salomon?

7. When investing in Italy, what did Long-Term avoid telling their customers?

8. Why are hedge funds considered low risk?

9. What did Long-Term do to limit risk in bond trading?

10. What was Long-Term's objective in seeking out a bank to finance their credit?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Examine one of the following forms of investment vehicles:

- Hedge funds.

- Value funds.

- Bonds.

Answering the follow questions:

- What are the principals of this form of investment?

- What was Meriwether's experience with this form of investment?

- To what extent did the general public participate in this form of investment?

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 Meriwether set up Long-Term, he had to take many steps to create the company. Write an essay examining the process Meriwether went through to create Long-Term.

(see the answer keys)

This section contains 525 words (approx. 2 pages at 300 words per page) View a FREE sample