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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. The market was considered a business partner with incurable _______ problems, according to the book.

2. What was the title of Buffett in relation to his company?

3. The board was ultimately responsible for any _______'s performance in the companies they held.

4. Buffett and Munger saw themselves as general _______ responsible to other shareholders.

5. The partners considered a lesser interest if the ________ price was less than what it would be for 100%.

Short Essay Questions

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

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

3. 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?

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

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

6. What did Buffett and Munger prefer to do when they invested in a company?

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

8. How did Buffett and Munger buy public companies, according to the book's details?

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

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

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Buffett decided to buy a company when their stock market value was less than their intrinsic value.

Part 1: Do you think Buffett should pay the intrinsic value or the stock market value?

Part 2: Why do you think a company might be worth less in the market than they are intrinsically?

Part 3: How do you think Buffett might approach a conversation about buying a company that has a lower market value?

Essay Topic 2

Buffett and Munger thought it was better to monitor management as an investment strategy.

Part 1: How does management impact the way that a company works?

Part 2: Do you think management can be something that predicts financial stability?

Part 3: Why do you think Munger and Buffett looked at management to determine their investments?

Essay Topic 3

Fear and greed were described as being two super contagious diseases in the investment community.

Part 1: Why do you think there is a lot of fear in the investment community?

Part 2: How do you think greed and fear might impact the way a person invests?

Part 3: Do you think that you would be swayed more by fear or by greed when investing? Why?

(see the answer keys)

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