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This quiz consists of 5 multiple choice and 5 short answer questions through Part 1: Chapter 4, Merge with Mike.

Multiple Choice Questions

1. How did Milken break into the Las Vegas gambling business community?
(a) Milken lowered his commissions to get large casino business.
(b) Milken traveled every weekend to gamble in Las Vegas.
(c) Milken showed the casino owners how they could double their income.
(d) Milken helped Steve Wynn raise the funds he needed to build in Atlantic City.

2. What was Fred Joseph's strategy for hiring employees for Drexel?
(a) paying higher commissions than anyone else
(b) hiring from the smaller firms so that they saw it as a step up
(c) getting recommendations from bigger firms
(d) overhiring to learn which are the ones to keep

3. Why did Drexel have to separate from J. P. Morgan?
(a) the enactments of the Glass-Steagall Act in 1934
(b) a disagreement between Drexel and Morgan
(c) the regulations of the sherman Anti-Trust Act
(d) the final break up of J. P. Morgan and Company

4. What did Milken and Joseph devise to keep business flowing during the recession?
(a) different kinds of instruments
(b) finance services for the largest clients
(c) better communications with clients
(d) ways of trading abroad

5. Why was Milken so interested in low grade bonds?
(a) they were the only ones he really understood
(b) equity offerings were not an option for the Drexel Burnham market
(c) he liked to gamble big time
(d) that was all he could afford

Short Answer Questions

1. What does FIFI stand for?

2. What was Drexel's only real competition by the 1980s?

3. What was it about Milken that impressed his clients?

4. Why did Drexel remain a privately-held company?

5. How did Milken and his wife travel to Los Angeles?

(see the answer key)

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