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This test consists of 5 multiple choice questions, 5 short answer questions, and 10 short essay questions.

Multiple Choice Questions

1. Where was much of the money coming from for takeovers in the 1980s?
(a) foreign investors with extra capital
(b) fake junk bonds imitating Milken's bonds
(c) big blind pools that Milken would raise for his customers
(d) the break up and sale of raided company divisions

2. What was one thing Lowell Milken did for the company?
(a) make the coffee
(b) keep out unwanted visitors
(c) make political contacts
(d) find tax shelters for them

3. To find more ways for their clients to make money, to what did Milken and Joseph turn their attention?
(a) mergers and acquisitions
(b) offshore banking
(c) entertainment properties
(d) financial planning

4. Why did Milken takeovers work?
(a) because Milken personally supervised the takeovers
(b) because the raiders were backed by pools of capital
(c) because of inside information
(d) because of Milken's name associated with the takeover

5. Who are two examples of Milken clients who became quite wealthy?
(a) Lawrence Welk and Ray Milland
(b) Marty Ingles and Shirley Jones
(c) James Brown and Kevin Bacon
(d) Fred Carr and Thomas Spiegle

Short Answer Questions

1. To troubled businesses, what was Drexel's unregistered exchange offer?

2. Why did Posner back out of the National Can deal?

3. Why did Drexel want Carl Icahn as a client?

4. By 1986, who was the largest stockholder in Drexel Burnham Lambert?

5. What was the Wall Street attitude toward low grade bonds at the time Milken started trading in them?

Short Essay Questions

1. How did Drexel go about creating the Air Fund in an effort to get into M&A?

2. Tell something about Fred Joseph and how he became known at Drexel.

3. Describe the National Can Company takeover.

4. Write about the relationship between Milken and Steve Wynn of the gambling industry.

5. Explain the beginnings of blind pools arranged by Milken.

6. Explain how Milken became nervous over large bond deals.

7. What was Milken's greatest contribution to the Drexel firm when he was a part-time employee?

8. How did Milken begin building his fortune?

9. How did they get around the SEC bond registration rules?

10. Describe how Michael Milken is introduced in the book.

(see the answer keys)

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