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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. In bond trading, what are loans backed by collateral called?

2. Once in business, what did Long-Term have an easy time getting from banks?

3. In 1996, how much did Long-Term have in assets?

4. In 1996, Long-Term had achieved thirty times its what?

5. Why did Rosenfeld choose not to co-found Kapor's project?

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

4. What was Meriwether's business model for Long-Term?

5. What are relative value trades?

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

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

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

9. How did Long-Term respond to firms that would not waive the fee for the haircut?

10. Why were convergence trades the safest trades made by Long-Term?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

There were many warning signs that the profits delivered by Long-Term couldn't last. Yet, many companies did everything possible to keep some investments going at higher and higher levels when they should have slowed. Using greed as a theme, analyze this situation.

Essay Topic 2

Write a brief essay supporting or refuting the following statement, citing examples from the text: Meriwether fully expected to continue making substantial returns with Long-Term's investment model.

Essay Topic 3

Basing your answer on the height of Long-Term's career, compare and contrast several of the companies on Wall Street with Long-Term, citing examples from the text.

(see the answer keys)

This section contains 460 words (approx. 2 pages at 300 words per page) View a FREE sample