WGU D076 Finance Skills for Managers OA Prep |
66 questions with verified answers
UNIT 2
A company's officers and board of directors are selling their stocks in the firm at
higher prices due to false accounting reports that made the stock seem more
valuable than it truly was. Which ethical issue is occurring in this situation?
1. Conflict between work and personal affairs
2. Agency problem due to conflicting interests
3. Pursuing individual interest over client interests
4. Maximizing shareholder value Ans✓✓✓-2. Agency problem due to conflicting
interests
Correct! Accounting manipulation by management in pursuit of higher stock-
related compensation is an example of an agency problem.
UNIT 2
In which type of market would a company issue bonds or stocks for the first time?
1. Dealer market
2. Money market
,3. Secondary market
4. Primary market Ans✓✓✓-4. Primary market
Correct! This is the purpose of a primary market.
UNIT 2
What are the main services offered by financial institutions?
1. Deciding which assets to invest in to create wealth in the future
2. Soliciting charitable donations and then managing the distribution of these
funds
3. Evaluating sources of funding for a business project, the capital structure of a
firm, or actions managers could take to increase the value of the firm
4. Accepting a wide variety of deposits, offering investment products, providing
loans, and brokering financial transactions Ans✓✓✓-4. Accepting a wide variety
of deposits, offering investment products, providing loans, and brokering financial
transactions
Correct! Financial institutions such as banks, insurance companies, and mutual
fund companies provide these services.
,UNIT 2
What does the term ethical refer to?
1. An idea or thing used as a measure, norm, or model in comparative evaluations
2. The accepted standards of conduct that guide a person's behavior
3. Following the laws and rules set by an authority
4. One's beliefs about right and wrong, good and bad, or just and unjust
Ans✓✓✓-2. The accepted standards of conduct that guide a person's behavior
Correct! Ethical refers to the accepted standards of conduct that guide a person's
behavior.
UNIT 2
What is the main objective of personal financial goals?
1. To maximize stock investments
2. To maximize owner wealth
3. To maximize charity donations
4. To maximize individual utility Ans✓✓✓-4. To maximize individual utility
, Correct! You set goals and act to increase your satisfaction or happiness by taking
care of necessities and achieving priorities.
UNIT 2
Which financial institution specializes in managing and administering retirement
funds?
1. Mutual funds
2. Investment banks
3. Private equity
4. Pension funds Ans✓✓✓-4. Pension funds
Correct! Pension funds specialize in retirement funds.
UNIT 2
Which task does the financial manager of a firm perform that involves the
issuance of new stocks and bonds?
1. Deciding on accounting standards
2. Making financing decisions
66 questions with verified answers
UNIT 2
A company's officers and board of directors are selling their stocks in the firm at
higher prices due to false accounting reports that made the stock seem more
valuable than it truly was. Which ethical issue is occurring in this situation?
1. Conflict between work and personal affairs
2. Agency problem due to conflicting interests
3. Pursuing individual interest over client interests
4. Maximizing shareholder value Ans✓✓✓-2. Agency problem due to conflicting
interests
Correct! Accounting manipulation by management in pursuit of higher stock-
related compensation is an example of an agency problem.
UNIT 2
In which type of market would a company issue bonds or stocks for the first time?
1. Dealer market
2. Money market
,3. Secondary market
4. Primary market Ans✓✓✓-4. Primary market
Correct! This is the purpose of a primary market.
UNIT 2
What are the main services offered by financial institutions?
1. Deciding which assets to invest in to create wealth in the future
2. Soliciting charitable donations and then managing the distribution of these
funds
3. Evaluating sources of funding for a business project, the capital structure of a
firm, or actions managers could take to increase the value of the firm
4. Accepting a wide variety of deposits, offering investment products, providing
loans, and brokering financial transactions Ans✓✓✓-4. Accepting a wide variety
of deposits, offering investment products, providing loans, and brokering financial
transactions
Correct! Financial institutions such as banks, insurance companies, and mutual
fund companies provide these services.
,UNIT 2
What does the term ethical refer to?
1. An idea or thing used as a measure, norm, or model in comparative evaluations
2. The accepted standards of conduct that guide a person's behavior
3. Following the laws and rules set by an authority
4. One's beliefs about right and wrong, good and bad, or just and unjust
Ans✓✓✓-2. The accepted standards of conduct that guide a person's behavior
Correct! Ethical refers to the accepted standards of conduct that guide a person's
behavior.
UNIT 2
What is the main objective of personal financial goals?
1. To maximize stock investments
2. To maximize owner wealth
3. To maximize charity donations
4. To maximize individual utility Ans✓✓✓-4. To maximize individual utility
, Correct! You set goals and act to increase your satisfaction or happiness by taking
care of necessities and achieving priorities.
UNIT 2
Which financial institution specializes in managing and administering retirement
funds?
1. Mutual funds
2. Investment banks
3. Private equity
4. Pension funds Ans✓✓✓-4. Pension funds
Correct! Pension funds specialize in retirement funds.
UNIT 2
Which task does the financial manager of a firm perform that involves the
issuance of new stocks and bonds?
1. Deciding on accounting standards
2. Making financing decisions
