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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. Non-transferability of _______ did not make them less costly to an employer, according to the book.
(a) Stock options.
(b) Bonds.
(c) Benefits.
(d) Dividends.

2. What kind of pro told Buffett the piece of information that helped to guide them on the field?
(a) Baseball.
(b) Soccer.
(c) Football.
(d) Golf.

3. Munger believed the _________ Berkshire paid to be acceptable for the benefits they received.
(a) Taxes.
(b) Court costs.
(c) Treasury funds.
(d) Accounting fees.

4. Options were often ______ at exercise which made them more expensive than publicly traded options.
(a) Presented.
(b) Re-priced.
(c) Undervalued.
(d) Moved.

5. Major business activities grouped together aided _____ by providing data in a more useful form.
(a) Analysis.
(b) Investments.
(c) Future goal setting.
(d) Stock prices.

Short Answer Questions

1. Buffett was often frustrated with _________, even though it was valuable for business practices.

2. What was NOT one of the three tax-free gifting tactics that Buffett suggested to shareholders?

3. Many ended up taking Buffett and Munger ________ on faith because of the way that they reported.

4. Buffett and Munger now believed that the substantial economic _________ far exceeded the book value of Berkshire.

5. _________ was spurious, to Buffett, compared to depreciation charges for deteriorating assets.

Short Essay Questions

1. What was the simple rule that Buffett followed when it came to exchange of stock during a merger?

2. Why did many executives argue about the costs of stock options and why they should be ignored?

3. Despite his frustration with the GAAP, what did Buffett come to realize about accounting data?

4. What was done in order to minimize any loss from accounting adjustments during the US Steel transactions?

5. Why would a company want to repurchase their own shares, according to Buffett?

6. What was the expected benefit for the Berkshire NYSE listing, according to the book?

7. What was the piece of advice from a golf pro that Buffett takes to heart in his acquisition strategy?

8. What was the result of information that is necessary to report to an investor or shareholder?

9. What were the two super contagious diseases that could spread in the investment community?

10. What did Buffett expect to owners of stock to do when he creates a principle that earnings should be retained to the extent each retained dollar creates at least one dollar of market value for owners?

(see the answer keys)

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