BXBX NOVEL Chapter 55: Exam and Deal
The only things we were allowed to have were a few pieces of paper and a pen; calculators were not permitted since the mathematical part of the exam was scheduled for tomorrow.
I found my assigned seat and sat down, staring at the blank piece of paper in front of me. The Professor on the front stage scribbled down the start time, "You can flip the exam paper." He announced.
I flipped the blank piece of paper to see the questions.
The exam was a mix of all the non-math courses we had covered. The first part was a series of 20 closed questions.
"Which scenario could lead to an improvement of a country\'s financial account but potentially harm its long-term economic health?" (C) Persistent borrowing from abroad.
"What happenes when there are differences in real interest rates between two countries?" (A) Capital flows to the country with the relatively higher real interest rate.
...
I quickly answered all of them.
Then came 5 open questions.
The first three were very straightforward. Nothing interesting, nothing to add.
But seeing the forth question, I would have laughed if I didn\'t remember answering it once before.
"Suppose you could buy shoes one at a time, rather than in pairs. What do you predict the cross-price elasticity for left shoes and right shoes would be?"
I answered: "I would predict the cross-price elasticity of demand to be highly negative. An increase in the price of one would lead to a decrease in the quantity demanded of the other. Higher price of one makes both less attractive. But with time smart buyers might appear with the idea of buying one and waiting for the price of the other to fall."
The last question had a "double-star" to it and it was there to prevent anyone from getting full-score.
It even said at the bottom that the question was from the man, the legend, Professor Blake of National Economics.
"What does an aging population do to the economy? "
\'A very broad question.\' I thought.
But questions 1 to 24 took me just 30 minutes and I had 2 hours left...
I remembered answering this question with a single sentence the first time around, thinking I was smart, just to get 0.5/5 points for it.
"Shrinking work force leads to slower GDP growth. Employers might need to rise wages to retain talented workers. Older people are less willing to take risks leading to less innovation. Additional strain on working class to support the elderly. Higher healthcare prices. Less consumption.
Decreased demand for housing could lead to a crash. Shift in investment preferences..."
And more and more...
I finished and put my pen down.
Thirty minutes later, Professor announced, "Those who finished writing already can leave now."
I stood up, pen still in hand. As I left the hall, I spotted Alex leaning against the wall outside.
"How\'d it go?" I asked.
"Simple enough." Alex replied with a shrug. "But I guess some of the others might need to start flipping my burgersa."
We chatted briefly about the exam, and then I waited another thirty minutes for Sam, who was in a neighboring classroom taking a special test with audio help.
Finally, Sam left the room and his bodyguard approached him immediatelly. They exchanged a few words before Sam walked up to me with his bodyguard\'s help.
"Let\'s go talk somewhere private," he said.
We walked out to the parking lot where Sam\'s limousine was parked.
Yesterday Sam said that he had a deal ready for me.
Once we were inside the limousine, Sam turned to me with his soul-devoid eyes open.
"Listen," he began. "I\'ve seen you work hard. You have also shown me how you turned nothing into millions. So, proposing a regular job to you would be pointless."
"Here\'s the deal: the Orlando branch of the trading company is currently valued at 290 million dollars. It\'s a private shareholding company and I\'m going to offer you a chance to be part of it. Right now, I hold 65% of the shares, my father owns 30%, and 5% is reserved for employee gifts."
"I want to offer you 20% of my shares for your work. What do you say?"
This kind of offer would never be possible if I didn\'t show him my earnings, it would also not be possible if I didn\'t show off my knowledge.
But there was a downside: this deal would likely mean that my relationship with Sam would become one of competition, rather than evolving into a friendship.
"Those are voting shares, am I right?" I asked.
"Yes, they are, You\'ll have a say in how the company is run."
I took a deep breath. "Sam, you\'re currently holding the majority of the voting shares, and you\'re willing to give it away just like that? You\'d be giving up the right to make decisions on your own."
Sam\'s brow furrowed. "I don\'t understand. Are you rejecting the offer?"
"No," I said, shaking my head. "I\'m saying you\'re being too naive... What if your father gifts his shares to someone and that someone persuades me to vote in his favor? You\'d lose all control."
He didn\'t answer so I continued, "I want to join your company mainly to build my credibility. I still want to focus on my own investments and trading, and I\'m starting another venture, so I won\'t have the time to fully commit to your company. I don\'t think it\'s right for me to demand this from you. Also, Sam, making this kind of decision might not be the best move for you.
You\'re too impulsive and too kind. You need to be more strategic. More greedy."
"It\'s not how I operate," Sam replied.
"I know..." I began, "Instead, I\'ll accept 10% of the shares and a good salary. That\'s all I need."
Sam paused for a long while, "I won\'t ask why you\'re being so considerate, but I agree. I\'ll have the contract ready by tomorrow."
I glanced at him, "...By the way, Sam. Do you like gambling?"
"No... Not really."
"I\'m going to Las Vegas next week. You can go with me if you want."
"No. Because my bodyguards would need to go with me."
"And? ... You should really let go a bit. Especially after the exams. Think about it." I said and then I opened the door of the limousine and stepped out without saying goodbye.
Once I was back at my dorm, I checked my brokerage account.
[AMERITRADE]
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[Total Balance: $6,814,259.01]
[Available Balance: $2.36]
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[Market Value of Holdings: $6,814,262.65]
[Margin: $6.00]
[Buying Power: $4.72]
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Portfolio:
[NetEase Inc ($NTES)] [$15.61] {[ 146,240 shares ]}
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Recent Transactions:
[Options Buy: NTES Call Option ($18), Cost: $0.31, Value: $16.11, Quantity: 114,275]
[Options Buy: NTES Call Option ($16), Cost: $0.26, Value: $15.92, Quantity: 169,000]
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