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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. What did Susie unexpectedly do at the age of forty-five?
(a) filed for divorce.
(b) returned to school.
(c) moved out of Buffett's house and into a San Francisco apartment.
(d) tried to commit suicide.

2. Who handled Berkshire's investments:
(a) Buffett and Bill Scott.
(b) Charlie Munger.
(c) his staff of fourteen traders.
(d) Buffett alone.

3. Warren's attitude toward leaving some money to his children changed when:
(a) he became ill.
(b) he became closer with Susie and her family when they were living in Omaha.
(c) the press became critical of him.
(d) Susie said she would never speak to him.

4. Salomon grew from 1955 on when they announced:
(a) they were purchased by J.P. Morgan.
(b) they would ac cept no new partners.
(c) partners would leave their capital in the firm.
(d) they went public.

5. The Nebraska Furniture Mart was owned by:
(a) Seabury Stanton.
(b) Katherine Graham.
(c) Rose Blumkin.
(d) Isadore Blumkin.

Short Answer Questions

1. The Efficient Market Theory was popular because it:

2. By the end of 1988, the Berkshire share price was approximately?

3. In Warren's view, the managers of other people's money:

4. In the 1980-84 period, insurance companies:

5. Buffett's views on hostile takeovers included all but:

Short Essay Questions

1. What was one of the first things Buffett did at Salomon?

2. What kind of stocks did Buffett look for?

3. What did Buffett do with his textile mills?

4. What stock did Buffett begin purchasing in 1988?

5. Salomon became the object of an SEC and Justice Department investigation because of their bond trading. What did they do?

6. How did Buffett learn about the Nebraska Furniture Mart?

7. What was the effect of irregularities in the bond trading by Salomon on traders?

8. What are zero coupon bonds that were being used to finance LBO?

9. Buffett's career was based on the Graham and Dodds theory of investing. What are the basis of Buffet's beliefs based on the teachings of Graham and Dodds?

10. How does Buffett describe the difference between his public and private lives?

(see the answer keys)

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