It's time to unveil the answers to The Five Dumbest Things Year-End Quiz. Those who answered all the questions correctly will get a chance at a copy of
Jim Cramer's RealMoney: Sane Investing in an Insane World, autographed by JJC himself. Tune in to the Five Dumbest Things on Friday to discover who won the contest!
Here are the questions, and the answers.
1. Hedge fund activist Carl Icahn has taken aim at the top execs at Time Warner (TWX) , accusing them of missed business opportunities and general mismanagement. Which of these actions didn't Icahn specifically demand from Time Warner?
A complete spinoff of the company's cable TV systems.
A $20 billion share buyback.
A study of why the company cafeteria isn't more affordable.
An accounting of the company's spending on public relations efforts.
: C. Icahn
complained in October about the cost of the company's headquarters, and specifically about the grandeur of the lunch room, but didn't question the posted menu prices.
2. In October Martha Stewart Living (MSO) stock took a beating on Wall Street after the media company's third-quarter earnings report. What were investors particularly miffed at?
Martha's pledge to stop chopping cabbage on TV.
Finance chief James Follo's promise to spend more time with family.
The company's decision to produce an origami-themed television show starring its founder.
An $11 million stock payout for The Apprentice: Martha Stewart.
D. The reality show was not only a ratings flop but also a raw deal for shareholders. The company
noted in its earnings release that holders have "no economic interest" in the show.
3. This fall Google (GOOG) - Get Report unveiled a huge secondary stock sale, in part to placate institutional investors who foolishly passed on its August 2004 initial public offering. By selling 14,159,265 shares, what mathematical concept did Google's Stanford-educated founders tip their hats to?
The Maclellan Oscillator.
The constant e.
: B. It was much remarked that 14,159,265 mimics pi (3.14159265), excluding the initial 3. As
noted, "Apparently Google wanted to be clever, but not badly enough to sell 31,415,927 million shares."
17 times Skype's 2004 revenue.
: C. eBay agreed to pay as much as $4.1 billion for the Luxembourg-based voice over Internet protocol player, which had $7 million in 2004 revenue. Of course, using 2005's revenue target of 60, the multiple is just 68 times revenue -- compared with, say, a recent 30 multiple for Google.
5. The Dolan family behind Long Island's Cablevision (CVC) has changed course a few times this year. What plan didn't the cable TV company adopt and then discard in 2005?
Launch a satellite TV service called Doom.
Acquire the assets of bankrupt rival Adelphia.
Go private, spin off the sports teams.
Pay out billions in a special dividend.
: A. An uproar over shutting down the TV service caused Chairman Charles Dolan to break with his CEO son James and replace several board members with handpicked cronies. But it was called Voom, not Doom.
6. Sirius (SIRI) - Get Report has turned heads with its big-bucks signings of huge media stars Howard Stern, Martha Stewart and Jimmy Buffett, as well as the sought-after satellite radio rights to pro football and basketball games. Who else did Sirius sign up this year?
Los Angeles Lakers Coach Phil Jackson.
New York Yankees shortstop Derek Jeter.
New York Giants running back Tiki Barber.
All of the above.
: A. Rival
, which holds the big major league baseball contract, signed Jeter, and
Fox signed Barber. Sirius also got the rights to
Ivy League sports, but that's another story.
Editor's Note: Several readers noted that Barber actually has a show on Sirius too, along with his brother Ronde. So both A and C are acceptable answers for this question. But Jeter signed with XM, so answers B and D aren't correct.
7. Former Refco chief Phil Bennett was arrested in October and charged with defrauding investors in the commodity futures broker of more than $500 million. What was Bennett reportedly planning when investigators nabbed him?
An investigation of undisclosed side loans.
A critique of the firm's risk management system.
A wine-tasting vacation in Europe.
A staffwide meeting to discuss coming challenges.
: C. Whether the itinerary focused on Burgundy and Bourdeaux or Tuscany and Florence isn't known.
8. Former AOL chief Steve Case laments that the 2001 Time Warner-AOL linkup he engineered "quickly became widely derided as the 'worst merger in history.'" Why does Case believe that is?
The merger was the product of unbearable hype and incoherent strategy.
The merger added bureaucracy to a pair of already unresponsive companies.
Case wore a tie to the merger press conference but his peer Gerald Levin of Time Warner didn't.
"I have my own views, but now is not the time for that debate."
: D. Case weighs in on the issue in a recent
op-ed piece, but offers little insight on the key question weighing down AOL and Time Warner to this day.
9. Motorola (MOT) had a strong year, riding the red-hot sales performance of a thin, silvery, flipover cell phone, the Razr. What other phones has the company set plans to sell in coming years?
A and D.
: E. The company's
Rokr music phone failed to take off saleswise after repeated scrubs of its launch. But Razr has enabled the company to grab high-end market share away from
10. General Motors (GM) - Get Report shares have plunged to 23-year lows amid debt downgrades, sales setbacks and labor worries. The company has set plans to cut 30,000 jobs and may be overtaken next year as the world's biggest car maker by Toyota (TM) - Get Report. How did CEO Rick Wagoner recently assess the term of his retiring finance chief, John Devine?
"He's added huge value."
"He's had a good run here."
"He will be missed."
All of the above.
: A. Luckily, Wagoner
added of Devine's replacement, Frederick Henderson, "Fritz is the right person to take on the top finance responsibility at GM."
Got your own idea for the dumbest thing of the week?
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