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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. Keynes stated: "The right method of investment is to put fairly large sums of money into enterprises which one thinks one knows something about and in the ________ of which one thoroughly believes."
(a) Philosophy.
(b) Product.
(c) Intrinsic value.
(d) Management.

2. A __________ was something that Buffett and Munger believed was valuable to inform businesses owners of the year's business growth.
(a) Business forum.
(b) Business trade show.
(c) Business report.
(d) Business gathering.

3. The current value of the company Buffett and his partner bought showed that they understated its current ________ value.
(a) Intrinsic.
(b) Market.
(c) World.
(d) Business.

4. Munger and Buffett act like ________ when it comes to considering the economic prospects of the businesses they buy.
(a) Business analysts.
(b) Stock traders.
(c) Kids.
(d) Bankers.

5. Buffett is proud that ____% of the shares outstanding at the end of each year were held by the same shareholders.
(a) 50.
(b) 99.
(c) 98.
(d) 90.

6. What were the name of the bonds that Buffett seeks to promote through Berkshire?
(a) None.
(b) Angel.
(c) Junk.
(d) Zero-coupon.

7. Buffett criticizes __________ market theory as be does not believe it to be a truth.
(a) Erasing.
(b) Efficient.
(c) Effective.
(d) Eradicant.

8. The permanent holdings at Berkshire were those that Buffett and Munger decided to keep, no matter what the _________ offered.
(a) Value.
(b) Options.
(c) Price.
(d) Name.

9. _________ percentage ownership was acquired when the market presented opportunities, according to the book.
(a) Greater.
(b) More.
(c) Lesser.
(d) Beholden.

10. Buffett and Munger bought _________ companies the same way they might buy private companies.
(a) Large.
(b) Corporate.
(c) Public.
(d) Small.

11. Buffett did not expand, borrow, or sell unless Berkshire received as much _________ as it gave.
(a) Dividends.
(b) Power.
(c) Promise.
(d) Value.

12. Buffett's wealth was solely in _________ stock, investing and reinvesting dividends on its proportional increase per share market value over time.
(a) Coca-Cola.
(b) Wells Fargo.
(c) Berkshire.
(d) GEICO.

13. Buffett and Munger also followed the idea of minimal use of _______ and leverage, helping to create solid investments.
(a) Recovery.
(b) Divestment.
(c) Debt.
(d) Consolidation.

14. Buffett managed by ________-related business principles, according to the book.
(a) Math.
(b) Owner.
(c) Business.
(d) Stock.

15. What did Berkshire do in the case of the zero-coupon bonds? They deducted ______ with no cash paid out.
(a) Shares.
(b) Interest.
(c) Length of time to cash it out.
(d) Value.

Short Answer Questions

1. Buffett disliked _________ because of its leverage, according to the book.

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

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

4. In some cases, the benefits of partial ownership earnings may far outweigh the ________ acquisition cost.

5. Berkshire was a ________ corporation, as it was described in this section of the book.

(see the answer keys)

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