WGU D363 Preassesment
1. An individual wants to build up an emergency fund in B) $2,000
a savings account. Monthly expenses for this individ-
ual total $4,000 per month, while monthly income is
$5,000.
How much can be saved if the individual wants to build
up two months' worth of income savings?
A) $1,000
B) $2,000
C) $4,000
D) $5,000
2. An individual wants to make a large purchase that will B) A home equity line of
take two years to pay off. The individual owns a home, credit
earns an income of $75,000, and has no other debt
aside from a $900 mortgage payment with five years
left at 3%. The individual will retire within one year and
will be required to take minimum distributions from a
traditional retirement account.
Which financing option is appropriate for this individ-
ual's financing objective?
A) A one-time credit card purchase
B) A home equity line of credit
C) An early distribution from retirement accounts
D) A consumer finance company loan
3. An individual's net earnings are $60,000 per year, with A) 1 year and 8 months
living expenses for housing, food, and transportation
amounting to $3,200 per month. The individual wants
to save $30,000 for a home down payment and plans
, WGU D363 Preassesment
to travel once a year, with the trip costing $3,000.
How long until the individual can fund both goals for
the same year if income and expenses stay consis-
tent?
A) 1 year and 8 months
B) 2 years and 9 months
C) 3 years and 2 months
D) 3 years and 4 months
4. A cost-sensitive individual utilizes an advisory firm for C) Firm's fees exceeding
financial planning and investment management with overall investment returns
a conservative risk profile. The client pays $1,000 per
year for a financial plan and $100 per year in invest-
ment product expenses.
Which possible outcome can complicate this individ-
ual's expectations based on the risk profile and needs?
A) Firm's allocation projecting a short investment time
horizon
B) Firm recommendations not meeting investment risk
appetite
C) Firm's fees exceeding overall investment returns
D) Firm's product offering increasing in cost annually
5. Jack is a freelance technical writer receiving a 1099 B) Maximize business de-
form from every client paying over $600, and Jack ductions and aggregate
earns between $60,000 and $65,000 per year. Jack also savings for higher tax
has increased monthly expenses to $4,000 per month, obligations
as spending needs have increased after Jack quit a job
last year that paid $55,000 in W-2 wages.
, WGU D363 Preassesment
How should Jack modify financial planning around this
employment change?
A) Fund an investment account to increase money
available for future tax payments
B) Maximize business deductions and aggregate sav-
ings for higher tax obligations
C) Maintain deductible expense spending to have the
highest possible tax write-offs
D) Make large cash donations to charitable causes to
deduct against taxable income
6. An individual earns $75,000 annually. Monthly rent is B) 26.4
$2,200, and 20% of monthly cash income is spent on
utilities, groceries, and transportation. To pay off a
credit card in six months, the client agrees to monthly
payments of $1,650.What is the monthly debt-to-in-
come ratio?
A) 25.6
B) 26.4
C) 32.5
D) 33.2
7. An individual has monthly expenses of $1,800 for rent B) 8.4%
and $1,000 for groceries, transportation, and other
necessary expenses. Which average return should the
individual expect to match 25% of yearly expenses on
a $100,000 investment?
A) 8.2%
B) 8.4%
1. An individual wants to build up an emergency fund in B) $2,000
a savings account. Monthly expenses for this individ-
ual total $4,000 per month, while monthly income is
$5,000.
How much can be saved if the individual wants to build
up two months' worth of income savings?
A) $1,000
B) $2,000
C) $4,000
D) $5,000
2. An individual wants to make a large purchase that will B) A home equity line of
take two years to pay off. The individual owns a home, credit
earns an income of $75,000, and has no other debt
aside from a $900 mortgage payment with five years
left at 3%. The individual will retire within one year and
will be required to take minimum distributions from a
traditional retirement account.
Which financing option is appropriate for this individ-
ual's financing objective?
A) A one-time credit card purchase
B) A home equity line of credit
C) An early distribution from retirement accounts
D) A consumer finance company loan
3. An individual's net earnings are $60,000 per year, with A) 1 year and 8 months
living expenses for housing, food, and transportation
amounting to $3,200 per month. The individual wants
to save $30,000 for a home down payment and plans
, WGU D363 Preassesment
to travel once a year, with the trip costing $3,000.
How long until the individual can fund both goals for
the same year if income and expenses stay consis-
tent?
A) 1 year and 8 months
B) 2 years and 9 months
C) 3 years and 2 months
D) 3 years and 4 months
4. A cost-sensitive individual utilizes an advisory firm for C) Firm's fees exceeding
financial planning and investment management with overall investment returns
a conservative risk profile. The client pays $1,000 per
year for a financial plan and $100 per year in invest-
ment product expenses.
Which possible outcome can complicate this individ-
ual's expectations based on the risk profile and needs?
A) Firm's allocation projecting a short investment time
horizon
B) Firm recommendations not meeting investment risk
appetite
C) Firm's fees exceeding overall investment returns
D) Firm's product offering increasing in cost annually
5. Jack is a freelance technical writer receiving a 1099 B) Maximize business de-
form from every client paying over $600, and Jack ductions and aggregate
earns between $60,000 and $65,000 per year. Jack also savings for higher tax
has increased monthly expenses to $4,000 per month, obligations
as spending needs have increased after Jack quit a job
last year that paid $55,000 in W-2 wages.
, WGU D363 Preassesment
How should Jack modify financial planning around this
employment change?
A) Fund an investment account to increase money
available for future tax payments
B) Maximize business deductions and aggregate sav-
ings for higher tax obligations
C) Maintain deductible expense spending to have the
highest possible tax write-offs
D) Make large cash donations to charitable causes to
deduct against taxable income
6. An individual earns $75,000 annually. Monthly rent is B) 26.4
$2,200, and 20% of monthly cash income is spent on
utilities, groceries, and transportation. To pay off a
credit card in six months, the client agrees to monthly
payments of $1,650.What is the monthly debt-to-in-
come ratio?
A) 25.6
B) 26.4
C) 32.5
D) 33.2
7. An individual has monthly expenses of $1,800 for rent B) 8.4%
and $1,000 for groceries, transportation, and other
necessary expenses. Which average return should the
individual expect to match 25% of yearly expenses on
a $100,000 investment?
A) 8.2%
B) 8.4%
