FINANCE SKILLS FOR MANAGERS (WGU
D076) EXAM PRACTICE QUESTIONS WITH
CORRECT ANSWERS
What should be the main question a firm asks when considering any investment
decision?
Do the benefits of this investment outweigh the costs?
For any investment, you should expect to receive a benefit worth at least as
much as the initial cost.
What is the primary aim of personal finance goals?
To maximize satisfaction from products purchased and services obtained. The
objective of personal financial goals is to maximize one's utility.
Which task does a financial manager perform when choosing to obtain a loan to
purchase a piece of equipment for a new project?
Making financing decisions.
Page | 1
,The manager is deciding where to get the funds to support a new project, which
means the manager is making a financing decision.
Which financial career focuses on investing capital into firms whose shares are
not currently sold on any public stock exchange?
Private equity deals with investments in firms that are privately held and whose
ownership is not yet bought or sold on any public stock exchange.
Which task does a financial manager perform when assessing the costs and
benefits of potential projects?
Making investment decisions
Managing working capital means overseeing day-to-day operations and cash
flows.
What is a reasonable alternative to keeping an emergency stash of cash?
Investing in a savings account
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,Investing in a readily withdrawable account that still earns some interest is a
value-preserving alternative.
Which area of finance deals with sources of funding and the capital structure of
corporations and seeks to increase the value of a firm to its owners?
Business finance is the area of finance that deals with uses and sources of
funding to increase the value of the firm.
What is the primary difference between finance and accounting?
Finance focuses on the future, while accounting is generally backward-looking.
Which subspecialty of finance primarily involves deciding which assets will
create more wealth and earn positive returns?
Investments is the area of finance that seeks to create wealth in the future by
deciding where to allocate money.
What is the primary goal of the financial manager of a firm?
To maximize owner wealth.
Page | 3
, The financial manager should make decisions based on the primary goal of
maximizing owner wealth.
What tool can you use to understand your overall personal cash flows?
Budgeting helps you to understand your income and expenses and to analyze
your cash flows.
You want to buy a house, so you obtain a mortgage for which you can afford
the monthly payments. What process have you engaged in as part of your
financial decision-making?
Financing
Part of the personal finance process is figuring out how to finance your goals in
a way that is within your means
What area of finance involves deciding which assets to invest in to create
wealth in the future?
Page | 4
D076) EXAM PRACTICE QUESTIONS WITH
CORRECT ANSWERS
What should be the main question a firm asks when considering any investment
decision?
Do the benefits of this investment outweigh the costs?
For any investment, you should expect to receive a benefit worth at least as
much as the initial cost.
What is the primary aim of personal finance goals?
To maximize satisfaction from products purchased and services obtained. The
objective of personal financial goals is to maximize one's utility.
Which task does a financial manager perform when choosing to obtain a loan to
purchase a piece of equipment for a new project?
Making financing decisions.
Page | 1
,The manager is deciding where to get the funds to support a new project, which
means the manager is making a financing decision.
Which financial career focuses on investing capital into firms whose shares are
not currently sold on any public stock exchange?
Private equity deals with investments in firms that are privately held and whose
ownership is not yet bought or sold on any public stock exchange.
Which task does a financial manager perform when assessing the costs and
benefits of potential projects?
Making investment decisions
Managing working capital means overseeing day-to-day operations and cash
flows.
What is a reasonable alternative to keeping an emergency stash of cash?
Investing in a savings account
Page | 2
,Investing in a readily withdrawable account that still earns some interest is a
value-preserving alternative.
Which area of finance deals with sources of funding and the capital structure of
corporations and seeks to increase the value of a firm to its owners?
Business finance is the area of finance that deals with uses and sources of
funding to increase the value of the firm.
What is the primary difference between finance and accounting?
Finance focuses on the future, while accounting is generally backward-looking.
Which subspecialty of finance primarily involves deciding which assets will
create more wealth and earn positive returns?
Investments is the area of finance that seeks to create wealth in the future by
deciding where to allocate money.
What is the primary goal of the financial manager of a firm?
To maximize owner wealth.
Page | 3
, The financial manager should make decisions based on the primary goal of
maximizing owner wealth.
What tool can you use to understand your overall personal cash flows?
Budgeting helps you to understand your income and expenses and to analyze
your cash flows.
You want to buy a house, so you obtain a mortgage for which you can afford
the monthly payments. What process have you engaged in as part of your
financial decision-making?
Financing
Part of the personal finance process is figuring out how to finance your goals in
a way that is within your means
What area of finance involves deciding which assets to invest in to create
wealth in the future?
Page | 4
