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This quiz consists of 5 multiple choice and 5 short answer questions through Chapters 4-5.

Multiple Choice Questions

1. The sale of CDSs grew AIG FP so quickly that it provided what percent of AIG's profits in Chapter 3?
(a) 35.
(b) 25.
(c) 20.
(d) 15.

2. For what company did Ben Hockett work when he met Jamie Mai?
(a) Deutsche Bank.
(b) Oppenheimer and Co.
(c) AIG FP.
(d) Standard & Poor's.

3. Meredith Whitney was an analyst of financial firms for what company in 2007?
(a) Citigroup.
(b) Salomon Brothers.
(c) Oppenheimer and Co.
(d) Household Finance Corporation.

4. In Michael Burry's first credit default swap, what was the rate of each bond purchased?
(a) $7 million.
(b) $3 million.
(c) $10 million.
(d) $1 million.

5. What is often referred to as a form of insurance that protects a lender if a borrower of capital defaults on a loan?
(a) FICO Scores.
(b) Collateral debt obligation.
(c) Credit default swap.
(d) Tranches.

Short Answer Questions

1. By what year had Steve Eisman gathered a group of investors around himself filled with people who believed as he did that no one on Wall Street knew what they were doing, as described in Chapter 1?

2. The alterations to bond ratings made by mortgage lenders in Chapter 4 led to such things as lending how much money to a migrant worker who made only $14,000 a year?

3. Steve Eisman discovered that what company was fraudulently selling fifteen year mortgages under the guise of thirty year mortgages?

4. What is the name of Mike Burry's investment group?

5. What refers to a cumulative number that suggests a consumer's credit risk?

(see the answer key)

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