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This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.

Short Answer Questions

1. What did banks and investors want from Long-Term?

2. In 1994, why did the price of bonds drop?

3. When Meriwether increased his position in Treasury futures, what did he expect the market to do?

4. Who ran the London office for Long-Term?

5. Once in business, what did Long-Term have an easy time getting from banks?

Short Essay Questions

1. Why did Meriwether begin recruiting employees he had worked with at the Arbitrage Group?

2. When additional investors returned to the Italian market, what did Long-Term do?

3. In 1996, which significant companies did Long-Term surpass in terms of assets?

4. Why did hedge funds make money for managers?

5. Why was the investment in Italy a risky one for Long-Term to make?

6. Why was Meriwether made a partner at Salomon?

7. Although Long-Term was performing so well by 1996, how many Americans knew of the fund's existence?

8. Why were convergence trades the safest trades made by Long-Term?

9. When investing in Italy, what did Long-Term avoid telling their customers?

10. What surprise happened when Meriwether was trading Treasury Bill futures?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Write a brief essay supporting or refuting the following statement, citing examples from the text: The irresponsible management of Long-Term by the partners led to its downfall.

Essay Topic 2

As Long-Term became more and more successful, many banks and investment firms were eager to work with the company. Examine the various ways banks and investment firms offered advantages to Long-Term and why.

Essay Topic 3

Write a brief essay supporting or refuting the following statement, citing examples from the text: Long-Term took part in risky investments as the market became over-saturated.

(see the answer keys)

This section contains 518 words (approx. 2 pages at 300 words per page) View a FREE sample