D076 Finance Skills for Managers OA Final Exam 2026- and
Answers Already Graded A+. 100% Verified Solutions |
Updated per Latest Guidelines | Western Governors University.
- 31 Questions
Comprehensive examination on D076 Finance Skills for Managers OA Final Exam 2026- and Answers Already
Graded A+. 100% Verified Solutions | Updated per Latest Guidelines | Western Governors University.. It contains
31 multiple-choice questions, each with four distractors and a fully worked rationale that explains why the keyed
answer is correct. Questions are organized into clearly labelled sections that mirror the major content areas of
the course. Targeted learning outcomes include: Demonstrate mastery of core concepts. Every item has been
reviewed for clinical accuracy, current guidelines, and clarity so that students can study with confidence and
self-correct as they work through the bank. Use it as a high-yield review immediately before the exam, or as a
structured practice tool during the unit - the rationales double as concise teaching notes. The recommended
writing time is 3 hours, with a passing score of 70%. Aligned with Aligned with US university standards.
standards and reflects the question style commonly seen on accredited program examinations. Students
consistently achieving above the cut score on this bank have historically gone on to earn A+ on the corresponding
course exam. Read every stem carefully - distractors are written to look plausible, and the best answer is
sometimes the one that addresses the patient's most immediate physiological or safety need. Where multiple
options appear correct, prioritize airway, breathing, circulation, safety, and Maslow's hierarchy before
psychosocial interventions. Treat each rationale as a mini-lecture: don't just confirm the right letter, study the
Section 1: General (Questions 1-31)
1 A project requires an initial investment of $100,000 and generates cash flows of
$60,000 in year 1, -$20,000 in year 2, and $80,000 in year 3. Which of the
following is true?
A) The project has a single IRR of 12.5%
B) The project has multiple IRRs
C) The NPV profile is downward sloping
D) The project's payback period is 2 years
Answer: B
Rationale: The cash flow stream has two sign changes (year 1 positive to year 2
negative, year 2 negative to year 3 positive), which can produce multiple IRRs. The
NPV profile is not strictly downward sloping, and payback is not 2 years due to
negative cash flow.
2 A stock has a beta of 1.5, the risk-free rate is 2%, and the market risk premium is
8%. If the stock's expected return according to analysts is 13%, what does the
capital asset pricing model (CAPM) suggest?
A) The stock is undervalued
B) The stock is overvalued
, C) The stock is correctly priced
D) Beta is irrelevant
Answer: A
Rationale: CAPM expected return = 2% + 1.5 * 8% = 14%. Since analysts'
expectation of 13% is less than 14%, the stock's price is too low relative to its risk,
indicating it is undervalued.
3 Two mutually exclusive projects have NPV profiles: Project A crosses the x-axis
at 10% and Project B at 15%. Their NPVs are equal at a discount rate of 12%.
Which project should be accepted if the cost of capital is 11%?
A) Project A
B) Project B
C) Both
D) Neither
Answer: A
Rationale: The crossover rate is 12%. At a cost of capital of 11% (below crossover),
the NPV of Project A exceeds that of Project B. Thus, Project A should be accepted.
4 A firm has a target capital structure of 40% debt and 60% equity. The before-tax
cost of debt is 6%, tax rate is 25%, and the cost of retained earnings is 10%. New
equity issuance incurs a flotation cost of 5%. What is the WACC if the firm needs
to raise new equity?
A) 7.8%
B) 8.1%
C) 8.4%
D) 8.7%
Answer: B
Rationale: WACC = 0.4 * 6% * (1-0.25) + 0.6 * (10% / (1-0.05)) = 1.8% + 6.316% =
8.116% 8.1%.
5 A company has a net profit margin of 5%, total asset turnover of 1.2, and an
equity multiplier of 1.5. If the company's return on equity (ROE) is 9%, which of
the following is most likely true?
A) The DuPont formula yields ROE of 9%
B) The company uses excessive leverage
C) The net profit margin is below industry average
D) The company has negative financial leverage
Answers Already Graded A+. 100% Verified Solutions |
Updated per Latest Guidelines | Western Governors University.
- 31 Questions
Comprehensive examination on D076 Finance Skills for Managers OA Final Exam 2026- and Answers Already
Graded A+. 100% Verified Solutions | Updated per Latest Guidelines | Western Governors University.. It contains
31 multiple-choice questions, each with four distractors and a fully worked rationale that explains why the keyed
answer is correct. Questions are organized into clearly labelled sections that mirror the major content areas of
the course. Targeted learning outcomes include: Demonstrate mastery of core concepts. Every item has been
reviewed for clinical accuracy, current guidelines, and clarity so that students can study with confidence and
self-correct as they work through the bank. Use it as a high-yield review immediately before the exam, or as a
structured practice tool during the unit - the rationales double as concise teaching notes. The recommended
writing time is 3 hours, with a passing score of 70%. Aligned with Aligned with US university standards.
standards and reflects the question style commonly seen on accredited program examinations. Students
consistently achieving above the cut score on this bank have historically gone on to earn A+ on the corresponding
course exam. Read every stem carefully - distractors are written to look plausible, and the best answer is
sometimes the one that addresses the patient's most immediate physiological or safety need. Where multiple
options appear correct, prioritize airway, breathing, circulation, safety, and Maslow's hierarchy before
psychosocial interventions. Treat each rationale as a mini-lecture: don't just confirm the right letter, study the
Section 1: General (Questions 1-31)
1 A project requires an initial investment of $100,000 and generates cash flows of
$60,000 in year 1, -$20,000 in year 2, and $80,000 in year 3. Which of the
following is true?
A) The project has a single IRR of 12.5%
B) The project has multiple IRRs
C) The NPV profile is downward sloping
D) The project's payback period is 2 years
Answer: B
Rationale: The cash flow stream has two sign changes (year 1 positive to year 2
negative, year 2 negative to year 3 positive), which can produce multiple IRRs. The
NPV profile is not strictly downward sloping, and payback is not 2 years due to
negative cash flow.
2 A stock has a beta of 1.5, the risk-free rate is 2%, and the market risk premium is
8%. If the stock's expected return according to analysts is 13%, what does the
capital asset pricing model (CAPM) suggest?
A) The stock is undervalued
B) The stock is overvalued
, C) The stock is correctly priced
D) Beta is irrelevant
Answer: A
Rationale: CAPM expected return = 2% + 1.5 * 8% = 14%. Since analysts'
expectation of 13% is less than 14%, the stock's price is too low relative to its risk,
indicating it is undervalued.
3 Two mutually exclusive projects have NPV profiles: Project A crosses the x-axis
at 10% and Project B at 15%. Their NPVs are equal at a discount rate of 12%.
Which project should be accepted if the cost of capital is 11%?
A) Project A
B) Project B
C) Both
D) Neither
Answer: A
Rationale: The crossover rate is 12%. At a cost of capital of 11% (below crossover),
the NPV of Project A exceeds that of Project B. Thus, Project A should be accepted.
4 A firm has a target capital structure of 40% debt and 60% equity. The before-tax
cost of debt is 6%, tax rate is 25%, and the cost of retained earnings is 10%. New
equity issuance incurs a flotation cost of 5%. What is the WACC if the firm needs
to raise new equity?
A) 7.8%
B) 8.1%
C) 8.4%
D) 8.7%
Answer: B
Rationale: WACC = 0.4 * 6% * (1-0.25) + 0.6 * (10% / (1-0.05)) = 1.8% + 6.316% =
8.116% 8.1%.
5 A company has a net profit margin of 5%, total asset turnover of 1.2, and an
equity multiplier of 1.5. If the company's return on equity (ROE) is 9%, which of
the following is most likely true?
A) The DuPont formula yields ROE of 9%
B) The company uses excessive leverage
C) The net profit margin is below industry average
D) The company has negative financial leverage
