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This quiz consists of 5 multiple choice and 5 short answer questions through The Fall.

Multiple Choice Questions

1. What unusual event happened when Meriwether began working with Treasury futures?
(a) He lost millions.
(b) The price fell.
(c) The U.S. government collapsed.
(d) The price rose.

2. When did Long-Term start losing money?
(a) When Meriwether opened a new company.
(b) When the Asian market collapsed.
(c) When Warren Buffet spoke out against Long-Term.
(d) When arbitrage operations were suspended.

3. When did the Russian market begin to fail?
(a) April 1998.
(b) May 1998.
(c) September 1998.
(d) August 1998.

4. In 1996, Long-Term was four times as large as what?
(a) The largest hedge fund.
(b) The Mexican Treasury.
(c) The U.S. Treasury.
(d) A small European country.

5. What did Long-Term expect foreign banks to invest?
(a) Only individuals could invest.
(b) $100 million.
(c) $1 million.
(d) $10 million.

Short Answer Questions

1. What did the letter Meriwether sent to his clients claim it was difficult to do with Long-Term?

2. Where was Robert C. Merton working when Meriwether hired him?

3. What is the method of paying a percentage of a bond called?

4. On what date did Russia declare a debt moratorium?

5. What did Long-Term want to do for investors?

(see the answer key)

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