|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. Berkshire's board included a controlling ________, in which other board members could persuade others to make changes.
2. The permanent holdings at Berkshire were those that Buffett and Munger decided to keep, no matter what the _________ offered.
3. Berkshire's long-term investment strategy to buy and to hold _______ for the long term was something that was comfortable to them.
4. The board was ultimately responsible for any _______'s performance in the companies they held.
5. Buffett and Munger invested based on company operating results and not on ____________.
(a) Profit margins.
(b) Shareholder opinion.
(c) The stock market.
(d) Price quotes.
6. How many owner-related business principles were listed in this section of the book by Buffett?
7. What were the name of the bonds that were issued during WWI?
(b) Series II.
(c) Series B.
(d) Series E.
8. What is NOT one of the companies listed as having the management requirements that Buffett and Munger want to see?
9. What company did Buffett acquire in 1964, which he eventually grew into a large holding company?
10. Many stocks had a _______, like Coca-Cola, but none have the same market share.
11. Berkshire was a ________ corporation, as it was described in this section of the book.
12. What did a bondholder have to do with their bond if they decided to cash it in early?
(a) Pay interest.
(b) Earn more.
(d) Transfer it back to the owner.
13. Buffett did not expand, borrow, or sell unless Berkshire received as much _________ as it gave.
14. _________ were often unwilling to discuss the business issues during meetings.
(a) The board members.
(c) The salespeople.
15. Some Berkshire insurance subsidiaries used _______ with its greater returns than to use Treasury Bils.
(a) Risky stocks.
(b) Investment games.
Short Answer Questions
1. What was NOT one of the elements listed in the elements of arbitrage in the book?
2. Buffett and Munger also followed the idea of minimal use of _______ and leverage, helping to create solid investments.
3. What was the title of Buffett in relation to his company?
4. What did Berkshire do in the case of the zero-coupon bonds? They deducted ______ with no cash paid out.
5. Which business did Munger and Buffett decide to close, despite their best efforts?
This section contains 420 words
(approx. 2 pages at 300 words per page)