3/31/25, 9:30 WGU D076 Finance Skills for Managers |
AM
WGU D076 FINANCE SKILLS FOR MANAGERS EXAM QUESTIONS AND
ANSWERS WITH COMPLETE SOLUTIONS VERIFIED GRADED A++
Terms in this set (171)
Investing in a savings account
What is a reasonable alternative to
Investing in a readily withdrawable account that still earns some interest is a value-
keeping an emergency stash of cash?
preserving alternative.
Which area of finance deals with sources Business finance is the area of finance that deals with uses and sources of
of funding and the capital structure funding to increase the value of the firm.
of
corporations and seeks to increase the
value of a firm to its owners?
What is the primary difference between Finance focuses on the future, while accounting is generally backward-looking.
finance and accounting?
Which subspecialty of finance Investments is the area of finance that seeks to create wealth in the future by
primarily involves deciding which assets deciding where to allocate money.
will create more wealth and earn
positive returns?
To maximize owner wealth.
What is the primary goal of the financial
The financial manager should make decisions based on the primary goal of
manager of a firm?
maximizing owner wealth.
What should be the main question a firm Do the benefits of this investment outweigh the costs?
asks when considering any investment For any investment, you should expect to receive a benefit worth at least as
decision? much as the initial cost.
What is the primary aim of To maximize satisfaction from products purchased and services obtained. The
personal finance goals? objective of personal financial goals is to maximize one's utility.
Which task does a financial manager Making financing decisions.
perform when choosing to obtain a loan The manager is deciding where to get the funds to support a new project, which
to purchase a piece of equipment for means the manager is making a financing decision.
a new project?
Which financial career focuses on Private equity deals with investments in firms that are privately held and whose
investing capital into firms whose shares ownership is not yet bought or sold on any public stock exchange.
are not currently sold on any public stock
exchange?
Which task does a financial manager Making investment decisions
perform when assessing the costs and Managing working capital means overseeing day-to-day operations and cash
benefits of potential projects? flows.
What tool can you use to understand Budgeting helps you to understand your income and expenses and to analyze
your overall personal cash flows? your cash flows.
You want to buy a house, so you obtain Financing
a mortgage for which you can afford Part of the personal finance process is figuring out how to finance your goals in a
the monthly payments. What process way that is within your means
have you engaged in as part of your
financial decision-making?
1/
9
, 3/31/25, 9:30 WGU D076 Finance Skills for Managers |
AM
What area of finance involves Investments
deciding which assets to invest in to Investments are an area of finance that involves deciding which assets to invest in
create wealth in the future? to create wealth in the future.
Hannah is the financial manager of a firm. Making a financing decision
A project that she has recommended has Since the project has already been approved, Hannah is trying to find a way to
been approved and will cost $5 finance the investment and considering its capital structure.
million. Since the company does not
have enough cash on reserve,
Hannah must
figure out how to raise enough money
to start the project. She can choose
whether to issue new bonds, new
stocks, a
mortgage loan, or some combination of
those options. What task is Hannah
performing in this scenario?
Maria and Mateo are setting financial To maximize individual utility
goals. They decide that they need to save While everyone has different personal financial goals, the objectives of such goals
$200 each month to reach their goal of is to maximize individual utility
taking their children to visit their
grandparents in Spain next summer.
What is the objective of setting such a
goal?
Financial planner
Which professional works with individuals
Professional financial planners work with individuals to help them achieve their
to help them achieve their financial
financial goals.
goals?
Omar is about to purchase a new car for Financing a goal
$30,000. He knows he wants to buy the He has already made a decision to purchase the car and is now deciding on
car, but he is still trying to decide how to financing options.
pay for it. He has barely over $30,000 in
his bank account. He can either take out
an auto loan from a bank or use a mix of
cash and an auto loan. In this
scenario, what is Omar doing?
What are the purposes of financial The purposes of financial markets are to provide liquidity and to determine prices.
markets?
In which financial market are securities Secondary market
such as stocks and bonds are traded after Financial securities are first sold in the primary financial market and then
their initial issuance? traded among investors in the secondary financial market.
What kind of market primarily allows Money market
institutions to borrow and lend in Assets in money markets are typically highly liquid and intended for use within a
the short term? year or less.
A local start-up company just hit its five- Primary market
year anniversary and is planning an initial When a company issues stock for the first time to raise capital, shares must
public offering sometime this year. In initially be sold through a primary market.
order to issue public stock, which
market will the company use?
What is the primary role of financial To conduct financial transactions such as investments, loans, and deposits
institutions?
An institution that accepts and pays interest on deposits of money, as well as
What is a depository institution?
extends loans
2/
9
AM
WGU D076 FINANCE SKILLS FOR MANAGERS EXAM QUESTIONS AND
ANSWERS WITH COMPLETE SOLUTIONS VERIFIED GRADED A++
Terms in this set (171)
Investing in a savings account
What is a reasonable alternative to
Investing in a readily withdrawable account that still earns some interest is a value-
keeping an emergency stash of cash?
preserving alternative.
Which area of finance deals with sources Business finance is the area of finance that deals with uses and sources of
of funding and the capital structure funding to increase the value of the firm.
of
corporations and seeks to increase the
value of a firm to its owners?
What is the primary difference between Finance focuses on the future, while accounting is generally backward-looking.
finance and accounting?
Which subspecialty of finance Investments is the area of finance that seeks to create wealth in the future by
primarily involves deciding which assets deciding where to allocate money.
will create more wealth and earn
positive returns?
To maximize owner wealth.
What is the primary goal of the financial
The financial manager should make decisions based on the primary goal of
manager of a firm?
maximizing owner wealth.
What should be the main question a firm Do the benefits of this investment outweigh the costs?
asks when considering any investment For any investment, you should expect to receive a benefit worth at least as
decision? much as the initial cost.
What is the primary aim of To maximize satisfaction from products purchased and services obtained. The
personal finance goals? objective of personal financial goals is to maximize one's utility.
Which task does a financial manager Making financing decisions.
perform when choosing to obtain a loan The manager is deciding where to get the funds to support a new project, which
to purchase a piece of equipment for means the manager is making a financing decision.
a new project?
Which financial career focuses on Private equity deals with investments in firms that are privately held and whose
investing capital into firms whose shares ownership is not yet bought or sold on any public stock exchange.
are not currently sold on any public stock
exchange?
Which task does a financial manager Making investment decisions
perform when assessing the costs and Managing working capital means overseeing day-to-day operations and cash
benefits of potential projects? flows.
What tool can you use to understand Budgeting helps you to understand your income and expenses and to analyze
your overall personal cash flows? your cash flows.
You want to buy a house, so you obtain Financing
a mortgage for which you can afford Part of the personal finance process is figuring out how to finance your goals in a
the monthly payments. What process way that is within your means
have you engaged in as part of your
financial decision-making?
1/
9
, 3/31/25, 9:30 WGU D076 Finance Skills for Managers |
AM
What area of finance involves Investments
deciding which assets to invest in to Investments are an area of finance that involves deciding which assets to invest in
create wealth in the future? to create wealth in the future.
Hannah is the financial manager of a firm. Making a financing decision
A project that she has recommended has Since the project has already been approved, Hannah is trying to find a way to
been approved and will cost $5 finance the investment and considering its capital structure.
million. Since the company does not
have enough cash on reserve,
Hannah must
figure out how to raise enough money
to start the project. She can choose
whether to issue new bonds, new
stocks, a
mortgage loan, or some combination of
those options. What task is Hannah
performing in this scenario?
Maria and Mateo are setting financial To maximize individual utility
goals. They decide that they need to save While everyone has different personal financial goals, the objectives of such goals
$200 each month to reach their goal of is to maximize individual utility
taking their children to visit their
grandparents in Spain next summer.
What is the objective of setting such a
goal?
Financial planner
Which professional works with individuals
Professional financial planners work with individuals to help them achieve their
to help them achieve their financial
financial goals.
goals?
Omar is about to purchase a new car for Financing a goal
$30,000. He knows he wants to buy the He has already made a decision to purchase the car and is now deciding on
car, but he is still trying to decide how to financing options.
pay for it. He has barely over $30,000 in
his bank account. He can either take out
an auto loan from a bank or use a mix of
cash and an auto loan. In this
scenario, what is Omar doing?
What are the purposes of financial The purposes of financial markets are to provide liquidity and to determine prices.
markets?
In which financial market are securities Secondary market
such as stocks and bonds are traded after Financial securities are first sold in the primary financial market and then
their initial issuance? traded among investors in the secondary financial market.
What kind of market primarily allows Money market
institutions to borrow and lend in Assets in money markets are typically highly liquid and intended for use within a
the short term? year or less.
A local start-up company just hit its five- Primary market
year anniversary and is planning an initial When a company issues stock for the first time to raise capital, shares must
public offering sometime this year. In initially be sold through a primary market.
order to issue public stock, which
market will the company use?
What is the primary role of financial To conduct financial transactions such as investments, loans, and deposits
institutions?
An institution that accepts and pays interest on deposits of money, as well as
What is a depository institution?
extends loans
2/
9
