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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. What was the name of the company that Buffett and Munger bought in 1973?

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

3. Preferred firms must pay returns above ______ investments and be compatible with management.

4. Many stocks had a _______, like Coca-Cola, but none have the same market share.

5. Preferred stock is considered with _________ that Munger and Buffett like, admire, and trust.

Short Essay Questions

1. Whose investing principles guided the Buffett purchase of Washington Post Company?

2. How did Buffett seek to define a corporation as a mechanism? What exactly did this mean?

3. What did Buffett have to say about the idea of annual meetings for shareholders and other business managers?

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

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

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

7. What was the main problem with the idea of efficient market theory, according to Buffett?

8. What did Buffett fear about investing in companies that were located in California?

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

10. What did Buffett decide to do in order to create a meeting in which business owners would be informed about the year's business growth and development?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Buffett didn't like to invest in banking because of the leverage involved. Banks were too difficult as investments most of the time.

Part 1: Do you think that banks can be good investment choices?

Part 2: Why do you think it might be better to stay away from banks as investments?

Part 3: How do you think a bank might become a better investment for a larger company?

Essay Topic 2

The textile company grew from a simple company to one that was a multi-million dollar corporation over time.

Part 1: Do you think it's the dream of all companies to become multi-million dollar companies?

Part 2: Why do you think Buffett and Munger aspired to do more with the company they had?

Part 3: Would you rather stay as one company or try to grow bigger over time?

Essay Topic 3

In order to buy bonds and stock in a company, Buffett and Munger required that companies have a firm management style.

Part 1: How might you define the idea of a firm management style?

Part 2: What are some modern companies today that have a good management approach?

Part 3: Do you think a company can be a success without a strong management team?

(see the answer keys)

This section contains 664 words (approx. 3 pages at 300 words per page) View a FREE sample