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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. Popular theory at the time said that the market was totally efficient at _________ investment.

2. Risk ___________ was defined as the pursuit of profits from anticipated events, according to the book.

3. Which business did Munger and Buffett decide to close, despite their best efforts?

4. Buffett and Munger invested based on company operating results and not on ____________.

5. How many owner-related business principles were listed in this section of the book by Buffett?

Short Essay Questions

1. What might a CEO do if they were unlikely to dispose of their successful operating business, according to Buffett?

2. What would business contraction cause, though Buffett says this was also an opportune time for investment?

3. What were some of the issues that could come up within an annual meeting, which made Buffet want to avoid these meetings?

4. What is the content of this book often used for, according to the author?

5. What was the concept of fallen angels, according to Buffett's lessons about investing?

6. Where did Berkshire directors have most of their net worth invested, according to the book?

7. What was the key principle of Ben Graham that guided the way that Buffett bought other businesses?

8. Who did Buffett consider to be partners with him in his business, according to the book?

9. What did Buffett and Munger commit to providing to their 300,000 shareholders?

10. What were the five different categories from which Buffett can select his investments?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Buffett and Munger supported acquiring firms only when the added intrinsic value to their market shares.

Part 1: Why do you think Buffett and Munger only wanted to acquire firms that added value?

Part 2: Do you think modern day companies limit the types of companies they acquire?

Part 3: How do you think Berkshire Hathaway might be been different had they simply bought any company that was up for sale?

Essay Topic 2

Some bonds started out as junk, but ended up being angel bonds, according to one of the essays in this book.

Part 1: Do you think that investing is a guessing game?

Part 2: How do you think a person can make the best possible decision about their investments?

Part 3: Why do you think some junk investments might end up being better investments than they seemed?

Essay Topic 3

Buffett pointed out that just because the market was often efficient does not mean that it is always efficient.

Part 1: Why do you think the idea of an efficient market is something to consider?

Part 2: How do you think an efficient market can impact the outcome of a financial transaction?

Part 3: Do you believe that the market is designed to be efficient?

(see the answer keys)

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