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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 did a dealer from J.F. Eckstein & Co. want from Meriwether in 1979?

2. Who gains from working with hedge funds?

3. What company was Kapor the founder of?

4. When Meriwether increased his position in Treasury futures, what did he expect the market to do?

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

Short Essay Questions

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

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

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

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

5. Why did Black and Scholes believe that price changes were random?

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

7. Why was Meriwether made a partner at Salomon?

8. Why did Meriwether increase his position on Treasury Bill futures in spite of the market fluctuation?

9. When did Meriwether begin making sales calls for Long-Term?

10. In 1996, which significant companies did Long-Term surpass in terms of assets?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Write a brief essay supporting or refuting the following statement, citing examples from the text: The irresponsible management of Long-Term by the partners led to its downfall.

Essay Topic 2

Write a brief essay supporting or refuting the following statement, citing examples from the text: Long-Term took part in risky investments as the market became over-saturated.

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 508 words (approx. 2 pages at 300 words per page) View a FREE sample