View a FREE sample

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

Short Answer Questions

1. What did Meriwether do with his staff?

2. Meriwether believed that risk and volatility were what?

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

4. What did Long-Term expect foreign banks to invest?

5. Who gains from working with hedge funds?

Short Essay Questions

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

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

3. Why did hedge funds make money for managers?

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

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

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

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

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

9. Although Long-Term was performing so well by 1996, how many Americans knew of the fund's existence?

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

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

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 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)

This section contains 551 words (approx. 2 pages at 300 words per page) View a FREE sample