WGU C214 Financial Management Practice Exam 2026 | Complete Questions & Verified Answers

C214 Financial Management Practice Exam (150 Questions) Exam (Latest 2026)
Questions with Revised Answers, (A+ Guarantee) LATEST UPDATE

Q1: You invest $5,000 at 5% annual interest for 4 years. What is the future value?
A) $5,500
B) $6,078
C) $6,200
D) $5,750

Answer: B) $6,078
Rationale: FV=5,000×(1+0.05)4=5,000×1.2155=6,077.53≈6,078FV = 5,000 \times (1+0.05)^4
= 5,000 \times 1.2155 = 6,077.53 \approx
6,078FV=5,000×(1+0.05)4=5,000×1.2155=6,077.53≈6,078



Q2: A loan requires annual payments of $2,000 for 5 years at 6%. What is the present value?
A) $8,500
B) $8,420
C) $9,000
D) $10,000

Answer: B) $8,420
Rationale: PV=PMT×1−(1+r)−nr=2,000×1−(1.06)−50.06=8,418≈8,420PV = PMT \times
\frac{1-(1+r)^{-n}}{r} = 2,000 \times \frac{1-(1.06)^{-5}}{0.06} = 8,418 \approx
8,420PV=PMT×r1−(1+r)−n=2,000×0.061−(1.06)−5=8,418≈8,420



Q3: You deposit $1,000 annually for 3 years at 7%. What is the future value of the annuity?
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A) $3,210
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B) $3,225

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,C) $3,225.50
D) $3,100

Answer: C) $3,225.50
Rationale: FV of annuity: FV=PMT×(1+r)n−1r=1,000×(1.07)3−10.07=3,225.50FV = PMT
\times \frac{(1+r)^n - 1}{r} = 1,000 \times \frac{(1.07)^3 - 1}{0.07} =
3,225.50FV=PMT×r(1+r)n−1=1,000×0.07(1.07)3−1=3,225.50



Q4: Present value of $10,000 received in 5 years at 6%?
A) $7,500
B) $7,472
C) $8,000
D) $7,600

Answer: B) $7,472
Rationale: PV=FV/(1+r)n=10,000/(1.06)5=10,000/1.3382=7,472PV = FV / (1+r)^n = 10,000 /
(1.06)^5 = 10,.3382 = 7,472PV=FV/(1+r)n=10,000/(1.06)5=10,000/1.3382=7,472



Q5: Which of the following statements is true?
A) Money today is worth less than money in the future
B) Money today is worth more than money in the future
C) PV = FV always
D) Interest does not affect money over time

Answer: B) Money today is worth more than money in the future
Rationale: Due to earning potential (interest, investment growth), present money has higher
value.



Q6: An investment of $8,000 grows to $10,000 in 3 years. What is the annual interest rate?
A) 7.5%
B) 7.87%
C) 8%
D) 6.5%

Answer: B) 7.87%
Rationale: FV=PV(1+r)n⇒10,000=8,000(1+r)3⇒r=(10,000/8,000)1/3−1=0.0787FV =
PV(1+r)^n \Rightarrow 10,000 = 8,000(1+r)^3 \Rightarrow r = (10,000/8,000)^{1/3}-1 =
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0.0787FV=PV(1+r)n⇒10,000=8,000(1+r)3⇒r=(10,000/8,000)1/3−1=0.0787
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, Q7: Which formula calculates the present value of an ordinary annuity?
A) PV=FV/(1+r)nPV = FV/(1+r)^nPV=FV/(1+r)n
B) PV=PMT×1−(1+r)−nr PV = PMT \times \frac{1-(1+r)^{-n}}{r} PV=PMT×r1−(1+r)−n

C) PV=PMT×(1+r)nPV = PMT \times (1+r)^nPV=PMT×(1+r)n
D) PV=FV−PVPV = FV - PVPV=FV−PV

Answer: B) PV=PMT×1−(1+r)−nr PV = PMT \times \frac{1-(1+r)^{-n}}{r}
PV=PMT×r1−(1+r)−n
Rationale: This formula discounts each annuity payment to present value.



Q8: A 10-year investment offers $1,000 per year at 5%. PV?
A) $7,722
B) $8,000
C) $7,500
D) $7,900

Answer: A) $7,722
Rationale: PV = 1,000×1−(1.05)−100.05=7,721.73≈7,7221,000 \times \frac{1-(1.05)^{-
10}}{0.05} = 7,721.73 \approx 7,7221,000×0.051−(1.05)−10=7,721.73≈7,722



Q9: Future value of $2,500 invested for 6 years at 4%?
A) $3,200
B) $3,168
C) $3,250
D) $3,100

Answer: B) $3,168
Rationale: FV=2,500(1.04)6=2,500×1.2653=3,163.25≈3,168FV = 2,500(1.04)^6 = 2,500 \times
1.2653 = 3,163.25 \approx 3,168FV=2,500(1.04)6=2,500×1.2653=3,163.25≈3,168



Q10: Which type of annuity pays at the beginning of each period?
A) Ordinary
B) Annuity Due
C) Perpetuity
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D) Deferred
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