WGU Finance C708 Latest Updated 2022
Acid Test Ratio ✔✔Current Assets - Inventory / Current Liabilities
Agency Costs ✔✔The costs that result from the principle-agent problem.
Aggressive Assets ✔✔Companies or securities with betas greater than 1.
Annuity Due ✔✔An annuity that pays at the beginning of each period.
Asset Manager ✔✔A professional who makes their living managing a portfolio of assets.
Asset Pricing ✔✔The process of valuing assets.
Beta ✔✔The measure of systematic risk determined by a regression line.
Build-Up Method ✔✔A technique to estimate the cost of equity.
Business Finance ✔✔Another word for corporate finance.
Capital Budgeting Analysis ✔✔The process of deciding what assets to buy.
Cash Management ✔✔Managing the day-to-day finance operations of a firm.
Compounding ✔✔Figuring out the future value of money you will invest.
Compounding Problem ✔✔When the periods, payments, and interest must be adjusted for non-
annual time value of money problems.
, Corporate Finance ✔✔The finance function within a business. One of the three main areas of
finance.
Corporate Governance ✔✔The structure, rules, and regulations for owners and managers of a firm.
Correlation ✔✔How related one asset's returns are to another asset's returns.
Cost of Capital ✔✔How much it costs the firm (in percentage terms) to finance its operations
through debt and/or equity.
Costly Capital ✔✔All interest-bearing debt plus all equity.
Coupon Rate ✔✔Another name for coupon yield.
Covenants ✔✔Rules set forth in the bond indenture to protect bond investors.
Cross-sectional Analysis ✔✔One of the three ways to use ratios by comparing the firm to other
firms' ratios or industry averages.
Current Market Value ✔✔What someone would pay right now for an asset.
Current Yield ✔✔An approximation of the current yield that does not incorporate the time value
of money = Annual Coupon/Current Market Value
Discretionary Financing Needed (DFN) ✔✔The difference between the firm's total financing need
(total projected assets) and the funding it has in place. Equals projected total assets - projected total
liabilities - projected owners' equity.
Acid Test Ratio ✔✔Current Assets - Inventory / Current Liabilities
Agency Costs ✔✔The costs that result from the principle-agent problem.
Aggressive Assets ✔✔Companies or securities with betas greater than 1.
Annuity Due ✔✔An annuity that pays at the beginning of each period.
Asset Manager ✔✔A professional who makes their living managing a portfolio of assets.
Asset Pricing ✔✔The process of valuing assets.
Beta ✔✔The measure of systematic risk determined by a regression line.
Build-Up Method ✔✔A technique to estimate the cost of equity.
Business Finance ✔✔Another word for corporate finance.
Capital Budgeting Analysis ✔✔The process of deciding what assets to buy.
Cash Management ✔✔Managing the day-to-day finance operations of a firm.
Compounding ✔✔Figuring out the future value of money you will invest.
Compounding Problem ✔✔When the periods, payments, and interest must be adjusted for non-
annual time value of money problems.
, Corporate Finance ✔✔The finance function within a business. One of the three main areas of
finance.
Corporate Governance ✔✔The structure, rules, and regulations for owners and managers of a firm.
Correlation ✔✔How related one asset's returns are to another asset's returns.
Cost of Capital ✔✔How much it costs the firm (in percentage terms) to finance its operations
through debt and/or equity.
Costly Capital ✔✔All interest-bearing debt plus all equity.
Coupon Rate ✔✔Another name for coupon yield.
Covenants ✔✔Rules set forth in the bond indenture to protect bond investors.
Cross-sectional Analysis ✔✔One of the three ways to use ratios by comparing the firm to other
firms' ratios or industry averages.
Current Market Value ✔✔What someone would pay right now for an asset.
Current Yield ✔✔An approximation of the current yield that does not incorporate the time value
of money = Annual Coupon/Current Market Value
Discretionary Financing Needed (DFN) ✔✔The difference between the firm's total financing need
(total projected assets) and the funding it has in place. Equals projected total assets - projected total
liabilities - projected owners' equity.
