Sunday Jul 20 2008
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A bit of Friday levity, courtesy McSweeney’s.

Word problems for future hedge fund managers:

Elementary (AGES 5-10)

• Dick has $1m. Jane has $1m. If Dick and Jane both give their $1m to T. Boone, how many millions will he claim he can turn it into?
• Among those earning 10-figure incomes, Mr Soros’s total annual compensation is greater than Mr Falcone’s. Mr Falcone’s is greater than Mr Griffin’s. Mr Griffin’s is smaller than Mr Soros’s, and Mr Paulson’s is greater than Mr Soros’s. In descending order, list the men by the respective hotness of their trophy wives.

Intermediate (AGES 11-15)

• Your middle-class parents have a combined household income of $115,000. You receive an allowance of $20 per week. If you save all your allowance for two years, how much debt will you need to finance a hostile takeover of your family? How will you structure the debt?
• At 10 am, a private Gulfstream G650 takes off from New York, headed south to the Caribbean island of St Bart’s, traveling at a speed of Mach 9. At 11 am, a private Gulfstream G550 takes off from St. Bart’s, headed north to New York, traveling at Mach 8.85. Both jets fly at 50,000 feet on parallel flight paths. When the aircraft pass each other somewhere over the Atlantic, how long after seeing the G650 will the owner of the G550 kick himself for not going top-of-the-line? (Answer should be expressed in nautical miles.)

Advanced (AGES 16-18)

• Mr Smith is being investigated by the SEC for insider trading. Calculate the probability of Mr Smith’s relocation to Dubai.
• If an American hedge-fund manager makes $900 million and is taxed at a rate of 15 percent, how many American factory workers making $32,500 and being taxed at a rate of 25 percent does that make a sucker of? (Show your work.)
• Days before the housing bubble bursts, you short the ABX subprime index and, when the ensuing mortgage crisis causes millions of families to lose their homes to foreclosure, you realize a $550m profit. Since, for you, this is the opposite of a problem, find the opposite of an answer.

Answers in the comments, dear readers.