Would You Pass the Warren Buffett Test?

did you know that warren buffett used to give a standardized test to his prospective employees at berkshire hathaway it was presented as an iq test but it's more like a test in arithmetic in a real world setting it showcases some interesting points about what the king of stocks thinks about a certain subject but we can talk about that more after the test soon-to-be employees had 15 minutes to take the exam and they were only allowed to use a pen and a paper there are 24 questions in total and each of them comes with five different answers named a to e with only one of them being correct in order to not run into any potential copyright problems i've modernized the questions somewhat just so you know but they will still test the same type of logic and mathematical properties i ran the test with a couple of friends to allocate an appropriate amount of time to each question and to be able to arrange them in order of difficulty are you ready to test your skills to see if you could have been an employee at berkshire hathaway in that case grab a pen and a paper because 15 minutes starts now oh yeah this is the swedish investor bringing you the best tips and tools for reaching financial freedom through stock market investing a person clears 30 emails in half a day after he's back from summer vacation at the same pace how many emails can he clear in five days henry who shouldn't be judged drinks fifty percent more coffee than his colleague mark mark drinks six cups a day how many cups does henry drink stockholm and copenhagen are approximately 500 kilometers apart but they show us two centimeters apart on a certain map how many kilometers apart are stockholm and dublin which are shown on the same map as being 5 centimeters apart the swedish investor made a mistake in his analysis of a company and was forced to sell its stock for three-fifths of what he purchased it for he sold it at 15 what did he buy it for a youtube channel has 2 million subscribers it loses 1.5 million of them after making a stupid video but then grinds back 1.2 million of them over the next 6 months how many million subscribers does it have after the 6 months it takes three-fourths of a minute for geico's fancy coffee machine to make a cup of regular black coffee it takes twice as long for it to make a cappuccino how many cappuccinos can it make in 15 minutes anna spent two hours producing a certain youtube video benjamin spent six hours on the same video catherine also contributed and she spent 4 hours their brand deal made them 180 for the video which they split in proportion to how many hours they put in how much did anna receive for the video berkshire hathaway's reinsurance department concludes that there were 50 earthquakes in the u.s of a certain magnitude during the last two and a half years assuming the same frequency how many earthquakes were there in the last one and a half years an investment banker began work on a job at 6 00 a.m and stopped at 8 30 pm he took half an hour off for lunch not that investment bankers care about over time but how many more hours did he work than a regular person this day if a regular person works 8 hours a boat is filled with 460 liters of water it takes in 25 liters of water per minute from a hole the owner of the boat is removing water with a can of cherry coke at the pace of 5 liters per minute in how many minutes will the boat be filled with 600 liters a huge family purchased 24 tickets to disney world the family has three times as many children as it has adults how many tickets for children did it purchase a certain band has nine hundred thousand plays on spotify of these 360 000 comes from their most popular song what percent of their place is from their most popular song all right let's scale up the difficulty somewhat the four percent rule says that an investor can safely retire when he can cover his yearly expenses with four percent of the total value of his portfolio how much must his portfolio be worth for him to be able to retire if his yearly expenses are twenty thousand dollars [Music] an investor has 72 000 remaining until he has reached his first million if he is to reach that million in two years how much must his account increase with on average per month [Music] so [Music] a certain company's shares are trading at 50 each with a 4.5 dividend how large is the dividend per share [Music] a house costs 1.5 million dollars sarah purchased it three years ago for two-thirds of that at the time of the purchase the previous owner of the house paid a real estate agent two dollars for every 100 of closing price how much did the previous owner pay the real estate agent [Music] [Music] [Music] a dozen meatballs at ikea used to be just 60 cents if you were really hungry how much did you have to pay for 78 meatballs back then if the unit price remained the same [Music] so [Music] a kid buys six peanut brittles at 45 cents each and six scotch mallows at 65 cents each what is the total cost of these seas candies chocolates [Music] [Music] more [Music] during the first five hours of a certain day gamestop's market cap increases in value by 4 billion dollars per hour how many billion dollars must it increase within the next three hours to maintain that average so [Music] [Music] an entrepreneur is selling wolf mugs online for 32 each which he buys for just 20 percent of that from alibaba how much does he make per mug after deducting his purchasing expenses [Music] so [Music] foreign an investor has two thousand eight hundred and fifty dollars she puts two-fifths of that in a bank account for emergency situations and the rest she invests in stocks how much does she invest in stocks [Music] wow [Music] um [Music] all right now it will become tougher in a coke can tower competition you are rewarded with 18 for every yard of coke tower that you can pile mary creates a tower which is 9 feet and 6 inches how much is she rewarded with you are rewarded for parts of a yard too [Music] [Music] it would take 20 seriously hungry people to clean up an all-you-can-eat buffet in five hours how many more seriously hungry people do you have to add to the bunch to clean up the buffet in four hours [Music] [Music] james who is not an investment banker is paid for overtime last week he worked 11 9 8 8 and 8 hours respectively on his weekdays how much was his pay for these five days if he's paid 1.5 times his regular rate when he's working longer than 8 hours on any one day his pay is 9.60 per hour [Music] [Music] [Music] before we reveal the answers i think it is interesting to see that buffett really doesn't care much about mathematics of higher levels when it comes to investing it's a terrible mistake to think that mathematics will take you a long place in investing you have to understand certain aspects of mathematics but you don't have to understand higher mathematics and higher mathematics may actually be dangerous and it will lead you down to down pathways that are better left on fraud at another time buffett said the following about investing you could do it without calculus you can do it you can really do it with a good understanding of arithmetic and an inherent sense of probabilities regular arithmetic will work a long way for the investor all right now to the answers by the way you can find the actual test of berkshire hathaway in andrew kilpatrick's monstrous book about warren buffett called of permanent value cheers guys

Channel: The Swedish Investor

Views: 76,686

Keywords: Warren Buffett test, Warren Buffett interview, Berkshire Hathaway test, Berkshire Hathaway interview, Warren Buffett advice, Warren Buffett investing strategy, Warren Buffett investing, Stock portfolio, Berkshire Hathaway, Charlie Munger, Investing 101, Investing in your 20s, Invest, How to start investing, Warren Buffett, Value investing, passive income, how to invest, investing, investing for beginners, how to invest in stocks, investing strategies, the Swedish investor

Id: dP4r0RQ3_74

Length: 18min 40sec (1120 seconds)

Published: Sat Oct 16 2021