WGU D775 EXAM STUDY
GUIDE. GRADED A+.
QUESTIONS AND 100%
VERIFIED ANSWERS. LATEST
2025/2026 UPDATE
Which principle guides business finance to optimize resource use? - Ans✔✔-
Risk-return trade-off — Finance balances risk and expected return.
Which activity describes capital raising in business finance? - Ans✔✔-Securing
funding for business operations and projects — Capital raising means obtaining
money for operations/investments.
Which finance activity involves the creation, circulation, and management of
money? - Ans✔✔-Setting monetary policy — Managed by central banks.
What is common stock? - Ans✔✔-A share of ownership in a firm with voting
rights.
What is a characteristic of preferred stock? - Ans✔✔-Fixed dividends — They
pay stated dividend amounts.
, What is the purpose of bonds from the issuer's perspective? - Ans✔✔-To raise
capital without diluting ownership — Bonds are debt.
Which type of bonds are considered junk bonds? - Ans✔✔-Speculative bonds
— Below investment grade.
Which type of investment vehicle is uniquely used for retirement savings? -
Ans✔✔-401(k) plans — Tax-advantaged retirement plan.
What is true about options in financial derivatives? - Ans✔✔-They give the
buyer the right, but not the obligation, to buy or sell an asset.
How do funds benefit from economies of scale? - Ans✔✔-Making large-scale
investments that reduce transaction costs.
What is an initial public offering (IPO)? - Ans✔✔-The first sale of a company's
stock to the public.
What is an example of a secondary market activity? - Ans✔✔-Trading of stocks
on the New York Stock Exchange.
What are the two main types of financial markets? - Ans✔✔-Primary markets
and secondary markets.
What is a role of financial regulators? - Ans✔✔-Ensuring fair and transparent
markets.
GUIDE. GRADED A+.
QUESTIONS AND 100%
VERIFIED ANSWERS. LATEST
2025/2026 UPDATE
Which principle guides business finance to optimize resource use? - Ans✔✔-
Risk-return trade-off — Finance balances risk and expected return.
Which activity describes capital raising in business finance? - Ans✔✔-Securing
funding for business operations and projects — Capital raising means obtaining
money for operations/investments.
Which finance activity involves the creation, circulation, and management of
money? - Ans✔✔-Setting monetary policy — Managed by central banks.
What is common stock? - Ans✔✔-A share of ownership in a firm with voting
rights.
What is a characteristic of preferred stock? - Ans✔✔-Fixed dividends — They
pay stated dividend amounts.
, What is the purpose of bonds from the issuer's perspective? - Ans✔✔-To raise
capital without diluting ownership — Bonds are debt.
Which type of bonds are considered junk bonds? - Ans✔✔-Speculative bonds
— Below investment grade.
Which type of investment vehicle is uniquely used for retirement savings? -
Ans✔✔-401(k) plans — Tax-advantaged retirement plan.
What is true about options in financial derivatives? - Ans✔✔-They give the
buyer the right, but not the obligation, to buy or sell an asset.
How do funds benefit from economies of scale? - Ans✔✔-Making large-scale
investments that reduce transaction costs.
What is an initial public offering (IPO)? - Ans✔✔-The first sale of a company's
stock to the public.
What is an example of a secondary market activity? - Ans✔✔-Trading of stocks
on the New York Stock Exchange.
What are the two main types of financial markets? - Ans✔✔-Primary markets
and secondary markets.
What is a role of financial regulators? - Ans✔✔-Ensuring fair and transparent
markets.
