WGU D076 Finance Skills for Managers |PA|
Pre-Assessment | Actual Questions and
Answers Latest Updated
(Graded A+)
Correct
Incorrect
D076 Finance Skills for Managers | Pre-Assessment
cost of capital,
, If the YTM decreases, internal rate of return (IRR)
Don't know?
2 of 142
Term
What indicates to a firm that a project will increase shareholder wealth?
Give this one a try later!
The NPV is positive. The Npv is negative
The irr is greater than the cost of
You should accept the project
capital.
Don't know?
, 3 of 142
Definition
It takes into account the idea that today's dollar is worth more than a
dollar in the future. Each and every period, cash flows are discounted
to the present time so you can compare costs and benefits at different
points in time as if they were at the same point in time in period 0.
Give this one a try later!
Similar to the NPV method, IRR also considers the time value of money.
Another advantage of the NPV method is that it tells you how much value is....
the NPV considers the time value of money
Suppose Alice is trying to explain to her friend, who knows nothing about the time
value of money, why she should invest in Alice's new company. Which method of
valuation should Alice use to convince her friend to invest?
Don't know?
4 of 142
Term
, The YTM has an inverse relationship with the price of the bond: if the
YTM increases,
Give this one a try later!
the interest rate of the bond remains
the price of the bond increases.
constant.
the price of the bond the credit rating of the bond
decreases. improves.
Don't know?
5 of 142
Definition
ranking multiple projects when the budget is limited.
Give this one a try later!
The highest quality bond rating from
How does the PI aid in interpretation
the three credit rating agencies is
of the NPV?
AAA, while
Time value of money functions are The biggest advantage of PI is
used to calculate that it is useful for
Pre-Assessment | Actual Questions and
Answers Latest Updated
(Graded A+)
Correct
Incorrect
D076 Finance Skills for Managers | Pre-Assessment
cost of capital,
, If the YTM decreases, internal rate of return (IRR)
Don't know?
2 of 142
Term
What indicates to a firm that a project will increase shareholder wealth?
Give this one a try later!
The NPV is positive. The Npv is negative
The irr is greater than the cost of
You should accept the project
capital.
Don't know?
, 3 of 142
Definition
It takes into account the idea that today's dollar is worth more than a
dollar in the future. Each and every period, cash flows are discounted
to the present time so you can compare costs and benefits at different
points in time as if they were at the same point in time in period 0.
Give this one a try later!
Similar to the NPV method, IRR also considers the time value of money.
Another advantage of the NPV method is that it tells you how much value is....
the NPV considers the time value of money
Suppose Alice is trying to explain to her friend, who knows nothing about the time
value of money, why she should invest in Alice's new company. Which method of
valuation should Alice use to convince her friend to invest?
Don't know?
4 of 142
Term
, The YTM has an inverse relationship with the price of the bond: if the
YTM increases,
Give this one a try later!
the interest rate of the bond remains
the price of the bond increases.
constant.
the price of the bond the credit rating of the bond
decreases. improves.
Don't know?
5 of 142
Definition
ranking multiple projects when the budget is limited.
Give this one a try later!
The highest quality bond rating from
How does the PI aid in interpretation
the three credit rating agencies is
of the NPV?
AAA, while
Time value of money functions are The biggest advantage of PI is
used to calculate that it is useful for
