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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. Major business activities grouped together aided _____ by providing data in a more useful form.

2. Buffett and Munger run the business so that all ___________ gain proportionately.

3. Some CEOs think that manipulating __________ could encourage the highest stock price available.

4. The goal of the partners was to maximize the real economic benefits, not just the number of ___________.

5. The Berkshire dividend share of Coca-Cola in 1990 included operating earnings of ___________.

Short Essay Questions

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

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

3. What did Buffett admit that he used to do when seeking out new investments thirty-five years ago?

4. What did Buffett try to do in order to avoid problems with the two contagious diseases in the investment community?

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

6. What could Berkshire shareholders be assured of, according to Buffett in the book?

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

8. What question emerged during the merger between Berkshire and Blue Chip in 1983?

9. 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?

10. What were the two categories of most interest for Munger and Buffett when they wanted to add to their holdings?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Buffett didn't like to invest in banking because of the leverage involved. Banks were too difficult as investments most of the time.

Part 1: Do you think that banks can be good investment choices?

Part 2: Why do you think it might be better to stay away from banks as investments?

Part 3: How do you think a bank might become a better investment for a larger company?

Essay Topic 2

Fear and greed were described as being two super contagious diseases in the investment community.

Part 1: Why do you think there is a lot of fear in the investment community?

Part 2: How do you think greed and fear might impact the way a person invests?

Part 3: Do you think that you would be swayed more by fear or by greed when investing? Why?

Essay Topic 3

Buffett decided to buy a company when their stock market value was less than their intrinsic value.

Part 1: Do you think Buffett should pay the intrinsic value or the stock market value?

Part 2: Why do you think a company might be worth less in the market than they are intrinsically?

Part 3: How do you think Buffett might approach a conversation about buying a company that has a lower market value?

(see the answer keys)

This section contains 676 words (approx. 3 pages at 300 words per page) View a FREE sample