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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. How many shareholders did Munger and Buffett pledge to provide fair and simultaneous reporting to?
(a) 300,000.
(b) 15,000.
(c) 10.
(d) 50%.

2. Preferred firms must pay returns above ______ investments and be compatible with management.
(a) Future.
(b) Mr. Market.
(c) Past.
(d) Fixed-income.

3. Buffett dismissed risk in his choices with his notion that falling __________ prices present an opportunity to buy.
(a) Mortgage.
(b) Checking.
(c) Stock.
(d) Bond.

4. Berkshire invested in companies with excellent economic prospects and outstanding __________.
(a) Stock prices.
(b) Managers.
(c) Ideas.
(d) Websites.

5. What did a bondholder have to do with their bond if they decided to cash it in early?
(a) Pay interest.
(b) Nothing.
(c) Earn more.
(d) Transfer it back to the owner.

Short Answer Questions

1. A bond is _______ with regular payment of interest and repayment of principle.

2. What was the value of the shares of the company that Buffett and his partner purchased thirty years after its purchase?

3. Berkshire Hathaway's insurance companies maintained how many permanent common stock holdings?

4. What was NOT one of the elements listed in the elements of arbitrage in the book?

5. What were the name of the bonds that were issued during WWI?

Short Essay Questions

1. What were some of the issues that could come up within an annual meeting, which made Buffet want to avoid these meetings?

2. What was listed as the difference between a fallen angel and a junk bond?

3. What did Buffett have to say about the idea of annual meetings for shareholders and other business managers?

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

5. 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?

6. Where did Berkshire directors have most of their net worth invested, according to the book?

7. Whose investing principles guided the Buffett purchase of Washington Post Company?

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

9. What did Buffett and Munger invest based upon, instead of price quotes?

10. What were some of the companies included in the purchases of Berkshire Hathaway under Munger and Buffett?

(see the answer keys)

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