WGU D076 Finance Skills for Managers Exam 2026 Verified Practice Questions
& Accurate Answers
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Module 1: Introduction to Finance & Ethics (Questions 1-20)
Question 1
What is the primary question that both individuals and companies must consider
when making financial decisions?
A) How quickly can the action be completed?
B) Will the benefits of the action outweigh the costs?
C) Is the action legal according to federal statutes?
D) What will competitors think of the decision?
Answer: B
Rationale: The core principle of finance is cost-benefit analysis. Every financial
decision, whether personal or corporate, should be made only if the expected
benefits exceed the associated costs.
Question 2
,A financial manager is deciding whether to raise capital by issuing new stocks or
new bonds. Which of the three main tasks of business finance is this an example
of?
A) Making investment decisions
B) Making financing decisions
C) Managing working capital
D) Capital budgeting analysis
Answer: B
Rationale: Financing decisions focus on the "right-hand side" of the balance
sheet—determining the mix of debt (bonds) and equity (stocks) used to fund the
firm's assets and operations.
Question 3
A company's officers knowingly falsify accounting reports to inflate the stock price
before selling their own shares. This ethical issue is known as:
A) A conflict of interest between clients and firm
B) A legal standard violation only
C) An agency problem due to conflicting interests
D) Maximizing shareholder value
,Answer: C
Rationale: This is a classic agency problem where managers (agents) act in their
own self-interest (selling stock high) rather than in the best interest of the
shareholders (principals).
Question 4
Which type of standard refers to the accepted standards of conduct that guide a
person’s behavior in a professional setting?
A) Legal
B) Moral
C) Ethical
D) Statutory
Answer: C
Rationale: While morals are personal beliefs, ethics are the accepted standards of
conduct within a group or profession.
Question 5
How does understanding finance help individuals manage their personal finances?
, A) It guarantees a high return on stock market investments
B) It helps individuals compare the costs and benefits of an action to determine if
it will increase their overall well-being
C) It allows individuals to avoid paying taxes
D) It focuses only on maximizing current spending
Answer: B
Rationale: Finance helps individuals make informed choices that maximize their
utility (satisfaction) by weighing the trade-offs of different financial decisions.
Question 6
Which subspecialty of finance primarily involves deciding which assets will create
more wealth and earn positive returns?
A) Business finance
B) Investments
C) Financial institutions
D) Personal finance
Answer: B
& Accurate Answers
.
Module 1: Introduction to Finance & Ethics (Questions 1-20)
Question 1
What is the primary question that both individuals and companies must consider
when making financial decisions?
A) How quickly can the action be completed?
B) Will the benefits of the action outweigh the costs?
C) Is the action legal according to federal statutes?
D) What will competitors think of the decision?
Answer: B
Rationale: The core principle of finance is cost-benefit analysis. Every financial
decision, whether personal or corporate, should be made only if the expected
benefits exceed the associated costs.
Question 2
,A financial manager is deciding whether to raise capital by issuing new stocks or
new bonds. Which of the three main tasks of business finance is this an example
of?
A) Making investment decisions
B) Making financing decisions
C) Managing working capital
D) Capital budgeting analysis
Answer: B
Rationale: Financing decisions focus on the "right-hand side" of the balance
sheet—determining the mix of debt (bonds) and equity (stocks) used to fund the
firm's assets and operations.
Question 3
A company's officers knowingly falsify accounting reports to inflate the stock price
before selling their own shares. This ethical issue is known as:
A) A conflict of interest between clients and firm
B) A legal standard violation only
C) An agency problem due to conflicting interests
D) Maximizing shareholder value
,Answer: C
Rationale: This is a classic agency problem where managers (agents) act in their
own self-interest (selling stock high) rather than in the best interest of the
shareholders (principals).
Question 4
Which type of standard refers to the accepted standards of conduct that guide a
person’s behavior in a professional setting?
A) Legal
B) Moral
C) Ethical
D) Statutory
Answer: C
Rationale: While morals are personal beliefs, ethics are the accepted standards of
conduct within a group or profession.
Question 5
How does understanding finance help individuals manage their personal finances?
, A) It guarantees a high return on stock market investments
B) It helps individuals compare the costs and benefits of an action to determine if
it will increase their overall well-being
C) It allows individuals to avoid paying taxes
D) It focuses only on maximizing current spending
Answer: B
Rationale: Finance helps individuals make informed choices that maximize their
utility (satisfaction) by weighing the trade-offs of different financial decisions.
Question 6
Which subspecialty of finance primarily involves deciding which assets will create
more wealth and earn positive returns?
A) Business finance
B) Investments
C) Financial institutions
D) Personal finance
Answer: B
