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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. Steve Eisman's team discovered in Chapter 4 that the mortgage lenders were using what to alter the rating of their bonds?
(a) Insider trading.
(b) Hackers.
(c) FICO scores.
(d) Bad math.

2. When Cornwall Capital Management moved to Bear Sterns, their account was handled by whom?
(a) Steve Eismann.
(b) Ace Greenburg.
(c) Lewis Ranieri.
(d) Michael Lewis.

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

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

5. What companies approached Michael Burry and provided him with capital to begin his new company?
(a) FrontPoint and Oppenheimer and Co.
(b) Oppenheimer and Co. and Deutsche Bank.
(c) Gotham Capital and White Mountains.
(d) Deutsche Bank and Standard & Poor's.

6. Who went to a conference of subprime mortgage bond professionals and learned from a woman that her supervisors picked and chose which mortgage bonds would be triple-A rated despite her frequent recommendations that most of them be downgraded?
(a) Steve Eisman.
(b) Ernestine Warner.
(c) Vincent Daniel.
(d) Jamie Mai.

7. What mortgage lender did an Oppenheimer banker obtain information on from Steve Eisman in Chapter 1?
(a) Aames Financial.
(b) Citigroup.
(c) Gotham Capital.
(d) Bear Stearns.

8. Gene Park worked for what company in Chapter 4?
(a) Standard & Poor's.
(b) Wachovia.
(c) AIG FP.
(d) FrontPoint.

9. Steve Eisman discovered that what company was fraudulently selling fifteen year mortgages under the guise of thirty year mortgages?
(a) Gotham Capital.
(b) Salomon Brothers.
(c) Household Finance Corporation.
(d) The Fitch Group.

10. With Ben Hockett's help, Cornwall received what contract?
(a) ISDA.
(b) JRCA.
(c) BYR.
(d) CDO.

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

12. When was Michael Lewis' first book published?
(a) 1983.
(b) 1985.
(c) 1989.
(d) 1979.

13. Where did Michael Burry share his thoughts on investing while learning what he could from others in Chapter 2?
(a) Wall street.
(b) Online social networks.
(c) Seminars.
(d) Church.

14. What is a global financial service company with its headquarters in Frankfurt, Germany?
(a) Oppenheimer and Co.
(b) Deutsche Bank.
(c) Morgan Stanley.
(d) The Fitch Group.

15. In Chapter 5, Ledley and Mai bought multi-million dollar triple-A CDOs rather than the triple-B CDOs who had purchased?
(a) Lippmann and Xu.
(b) Lippmann and Cassano.
(c) Burry and Eisman.
(d) Cassano and Burry.

Short Answer Questions

1. At what age was Michael Lewis when he was shocked that Wall Street would allow him to buy and sell stocks, as described in the Prologue?

2. Who began taking the bottom tranches of their mortgage bonds and packaging them together to create CDOs in Chapter 3?

3. In a short time, Michael Burry had credit default swaps worth what in subprime mortgage bonds in Chapter 2?

4. How much money did Charlie Ledley and Jamie Mai make from their first major investment in a company with legal trouble in Chapter 5?

5. Where did Michael Lewis earn his Masters degree in Economics?

(see the answer keys)

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