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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. How many employees were with Long-Term in 1996?

2. How much did Long-Term plan to take from its profits?

3. What was the end result of Meriwether's Treasury bill deal?

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

5. How long did Long-Term expect their investors to commit?

Short Essay Questions

1. Why did bonds lose their value in the 1970's?

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

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

4. What are relative value trades?

5. What was Meriwether's group at Salomon given the authority to do?

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

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

8. How did Long-Term respond to firms that would not waive the fee for the haircut?

9. How would a loan from a major bank help the partners at Long-Term make money?

10. What methods did Black and Scholes use to predict the changes that would take place in the market?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

When Long-Term achieved major profits in its first year, Meriwether wrote a letter to investors warning against such a strong future performance.

1) Why did Meriwether feel it was important to communicate with his investors?

2) What warnings did Meriwether share with his investors?

3) Why did Meriwether feel it necessary to communicate at this level?

Essay Topic 2

Meriwether enjoyed building strong teams to work with. Write a brief essay examining the qualities he sought out in his team members.

Essay Topic 3

Those involved at the top levels of Long-Term were given respect, money and opportunity. Write a brief essay analyzing some of the advantages a career at Long-Term gave many of the partners, citing examples from the text.

(see the answer keys)

This section contains 505 words (approx. 2 pages at 300 words per page) View a FREE sample