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This test consists of 5 multiple choice questions, 5 short answer questions, and 10 short essay questions.

Multiple Choice Questions

1. How much profit did the new holding of Berkshire make for Buffett and Munger?
(a) $150M.
(b) $250M.
(c) $100M.
(d) $500M.

2. How much was the company worth that Buffett and his partner created at the time of this book?
(a) $10M.
(b) $30M.
(c) $5M.
(d) $70B.

3. What company did Buffett acquire in 1964, which he eventually grew into a large holding company?
(a) Microsoft.
(b) Berkshire.
(c) Wal-Mart.
(d) Textile.

4. What were the name of the bonds that Buffett seeks to promote through Berkshire?
(a) None.
(b) Angel.
(c) Junk.
(d) Zero-coupon.

5. The margin of ________ was the cornerstone of investment success, according to Graham.
(a) Reward.
(b) Error.
(c) Risk.
(d) Safety.

Short Answer Questions

1. The $70B enterprise that Buffett and his partner buy includes GEICO and ________ corporation.

2. What was NOT one of the elements listed in the elements of arbitrage in the book?

3. What was the initial book value of the company that Buffett and his partner acquired in 1964?

4. What is NOT one of the companies listed as having the management requirements that Buffett and Munger want to see?

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

Short Essay Questions

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

2. What was the purpose of the fourteen owner-related business principles that Buffett lists in the book?

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

4. How did Buffett's criteria for buying companies and maintaining holdings help to maximize net worth in the long run?

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

6. What did Buffett and Munger invest based upon, instead of price quotes?

7. What were some of the companies included in the purchases of Berkshire Hathaway under Munger and Buffett?

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

9. What happened as a result of Buffett and Munger buying their holding companies at a fair rate or buying lesser interest in at the pro-rata price?

10. What were two of the benefits of zero-coupon bonds, as listed by Berkshire in their promotions?

(see the answer keys)

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