|Name: _________________________||Period: ___________________|
This test consists of 5 multiple choice questions, 5 short answer questions, and 10 short essay questions.
Multiple Choice Questions
1. ________ took fictional accounting actions that showed absurd accounting manipulations to let it undersell all competition to dominate the industry.
(c) US Steel.
2. Buffett and Munger believed that marketability and __________ were two terms that increased the likelihood of turnover.
3. The partners were committed to providing and presenting a _______ business and ownership philosophy.
4. Buffett and Munger did not operate a strategic plan for __________ but compare opportunities against passive investments.
5. Generally, earnings were reported when classified by a company as more than _______ owned.
Short Answer Questions
1. The benefits of __________ were retained by Berkshire since it was a strong franchise.
2. _________ was spurious, to Buffett, compared to depreciation charges for deteriorating assets.
3. Buffett stated that his position with any stock repurchase does not imply acceptance of _______, which he calls extortion.
4. ___________ were used to pay salaries and wages, which eliminated payroll with increased employee compensation.
5. ________ cannot outperform business indefinitely because earnings on stock investments were reduced by the amount of transaction and investment management costs.
Short Essay Questions
1. Why did many executives argue about the costs of stock options and why they should be ignored?
2. What were the two super contagious diseases that could spread in the investment community?
3. What was the result of information that is necessary to report to an investor or shareholder?
4. What could Berkshire shareholders be assured of, according to Buffett in the book?
5. To what other experience did Buffett compare the process of acquiring a business?
6. What was the difference between the purchase and the pooling transaction?
7. What happened as the result of the fictional accounting actions by US Steel?
8. Why would a company want to repurchase their own shares, according to Buffett?
9. What was the first step in the US Steel fictional accounting process?
10. What did Buffett say should happen to some earnings in dividends?
This section contains 557 words
(approx. 2 pages at 300 words per page)