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This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.

Short Answer Questions

1. Berkshire's board included a controlling ________, in which other board members could persuade others to make changes.

2. Buffett managed by ________-related business principles, according to the book.

3. Alternative investments were considered for __________ high quality investments when a preferable business could not be located.

4. The bonds that Buffett decides to buy in 1989 were thought to be ________, but turn out to be fallen angels.

5. The long-term economic goal was to maximize per-share average annual rate of gain at ______% of the intrinsic business value.

Short Essay Questions

1. Who was Mr. Market and where did Mr. Market come from, according to the book?

2. What was the long-term economic goal of the directors investing in the Berkshire company?

3. How did Buffett begin to promote the zero-coupon bonds from Berkshire, though it was complicated to do so?

4. How did Buffett and Munger buy public companies, according to the book's details?

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

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

7. What was the definition of the idea of risk arbitrage, according to the book?

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

9. 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?

10. What did Berkshire Hathaway become in the 1990s after its humble beginnings in the years before?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Some bonds started out as junk, but ended up being angel bonds, according to one of the essays in this book.

Part 1: Do you think that investing is a guessing game?

Part 2: How do you think a person can make the best possible decision about their investments?

Part 3: Why do you think some junk investments might end up being better investments than they seemed?

Essay Topic 2

Inactivity in investing was seen as intelligent investing as well, even though nothing was being done during some of these periods.

Part 1: Why might inactivity be beneficial to investing?

Part 2: Do you think inactivity or action is more helpful to an investing strategy?

Part 3: What do you think your investing approach might look like? Active or inactive? Both?

Essay Topic 3

Warren Buffett appeared to be a mild-mannered and modest person, unlike so many others in the financial market.

Part 1: Do you think that Buffett is the exception the rule that those with money are self-serving?

Part 2: Why do you think Buffett maintained the manner he did?

Part 3: How do you think Buffett is able to maintain his modest manner during his time at Berkshire Hathaway?

(see the answer keys)

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