WGU C214 Financial Management OA Prep Test
Bank 1 with 220 Questions and Correct Verified
Answers/ C214 Latest OA and PA Prep Test Bank
2026-2027/ C214 Objective Assessment
What is one way a firm maximizes shareholder value?
A. By switching inventory methods
B. By reducing the firm's labor force
C. By outsourcing the production of the firm's core product
D. By avoiding investments that cost more money than they bring in - ANSWER-
d
What is one of the two basic types of financial instruments?
A. Money Markets
B. Mutual Funds
C. Stocks
D. Options - ANSWER-c
The stock price of a company increases and the market is deemed efficient. What
assumption can be made?
A. A new, patented, product was introduced to the market.
B. New machinery was purchased with a useful life of 20 years.
C. Management is optimizing its resources and operating efficiently.
1
,D. Management hired new employees and invested in a training program. -
ANSWER-a
Which statement is true about how the global market affects the U.S.
A. A bad options trade executed by a foreign subsidiary of a Wall Street bank will
affect layoffs overseas.
B. A Bad derivatives trade executed by a foreign subsidiary of a Wall Street bank
will affect layoffs overseas.
C. American investors and fund managers make decisions based on financial
reporting standards developed and financial statements audited overseas.
D. Foreign investors and fund managers make decisions based on financial
reporting standards developed and financial statements audited overseas. -
ANSWER-d
What is the cash cycle?
a. The speed of collecting cash from customers
b. The amount of cash kept in banks
c. The comparison of debt to cash
d.The amount of time to regenerate cash - ANSWER-d
Why is float important to understand?
a. To know how to keep the company profitable
b. To know why the company needs cash
2
,c. To determine when to buy fixed assets
d. To time cash expenditures
e. None of the above - ANSWER-d
What should a company do to manage its working capital?
a. Collect quickly and pay slowly
b. Keep a large cash balance
c. Maximize the use of long term investment
d. Depreciate assets more slowly - ANSWER-a
What would be a source of information to determine Replacement Cost?
a. Building Appraisal
b. Accumulated Depreciation Expense
c. Stock price
d. Statement of Cash Flows - ANSWER-a
What does the Sarbanes-Oxley Act require companies to do?
a. Have a board of directors
b. Register all foreign sales
c. Make estimated tax payments
d. Have internal control audits - ANSWER-d
FINRA (Financial Industry Regulatory Authority) does the following: (pick one)
a. No foreign bribery by corporations
b. Regulates bond prices
3
, c. Establishes Credit Unions
d. Prosecutes naughty stock brokers
e. Regulates Hedge Funds - ANSWER-d
If a product is made 100% domestically, what can affect its domestic market?
a. International exchange rates
b. International competition
c. Product tariffs
d. International political regulations - ANSWER-b
If a company makes its product in a foreign country where labor costs are much
lower, what happens?
a. Profits and domestic employment goes up
b. Costs go up and domestic employment goes down
c. Costs stay the same and domestic employment increases
d. Profits go up and domestic employment decreases. - ANSWER-d
If the value of a dollar increases, the price of imports:
a. Increases
b. Decreases
c. Stays the same
d. Fluctuates - ANSWER-b
Why would a farmer buy a hedge when he signs a contract to sell produce
overseas?
a. To avoid tariffs
4
Bank 1 with 220 Questions and Correct Verified
Answers/ C214 Latest OA and PA Prep Test Bank
2026-2027/ C214 Objective Assessment
What is one way a firm maximizes shareholder value?
A. By switching inventory methods
B. By reducing the firm's labor force
C. By outsourcing the production of the firm's core product
D. By avoiding investments that cost more money than they bring in - ANSWER-
d
What is one of the two basic types of financial instruments?
A. Money Markets
B. Mutual Funds
C. Stocks
D. Options - ANSWER-c
The stock price of a company increases and the market is deemed efficient. What
assumption can be made?
A. A new, patented, product was introduced to the market.
B. New machinery was purchased with a useful life of 20 years.
C. Management is optimizing its resources and operating efficiently.
1
,D. Management hired new employees and invested in a training program. -
ANSWER-a
Which statement is true about how the global market affects the U.S.
A. A bad options trade executed by a foreign subsidiary of a Wall Street bank will
affect layoffs overseas.
B. A Bad derivatives trade executed by a foreign subsidiary of a Wall Street bank
will affect layoffs overseas.
C. American investors and fund managers make decisions based on financial
reporting standards developed and financial statements audited overseas.
D. Foreign investors and fund managers make decisions based on financial
reporting standards developed and financial statements audited overseas. -
ANSWER-d
What is the cash cycle?
a. The speed of collecting cash from customers
b. The amount of cash kept in banks
c. The comparison of debt to cash
d.The amount of time to regenerate cash - ANSWER-d
Why is float important to understand?
a. To know how to keep the company profitable
b. To know why the company needs cash
2
,c. To determine when to buy fixed assets
d. To time cash expenditures
e. None of the above - ANSWER-d
What should a company do to manage its working capital?
a. Collect quickly and pay slowly
b. Keep a large cash balance
c. Maximize the use of long term investment
d. Depreciate assets more slowly - ANSWER-a
What would be a source of information to determine Replacement Cost?
a. Building Appraisal
b. Accumulated Depreciation Expense
c. Stock price
d. Statement of Cash Flows - ANSWER-a
What does the Sarbanes-Oxley Act require companies to do?
a. Have a board of directors
b. Register all foreign sales
c. Make estimated tax payments
d. Have internal control audits - ANSWER-d
FINRA (Financial Industry Regulatory Authority) does the following: (pick one)
a. No foreign bribery by corporations
b. Regulates bond prices
3
, c. Establishes Credit Unions
d. Prosecutes naughty stock brokers
e. Regulates Hedge Funds - ANSWER-d
If a product is made 100% domestically, what can affect its domestic market?
a. International exchange rates
b. International competition
c. Product tariffs
d. International political regulations - ANSWER-b
If a company makes its product in a foreign country where labor costs are much
lower, what happens?
a. Profits and domestic employment goes up
b. Costs go up and domestic employment goes down
c. Costs stay the same and domestic employment increases
d. Profits go up and domestic employment decreases. - ANSWER-d
If the value of a dollar increases, the price of imports:
a. Increases
b. Decreases
c. Stays the same
d. Fluctuates - ANSWER-b
Why would a farmer buy a hedge when he signs a contract to sell produce
overseas?
a. To avoid tariffs
4
