WGU D076 FINANCE SKILLS FOR
MANAGERS STUDY GUIDE WITH
QUESTIONS AND CORRECT VERIFIED
ANSWERS GRADED A+ || 100%
GUARANTEED PASS NEWEST VERSION
EBIT - Answer Earnings before interest and taxes. Used to consider operating
earnings.
debt ratio - Answer Total liabilities over total assets.
The remaining amount is either equity or retained earnings.
0.3 means 30% of assets are financed through debt.
Debt to Equity Ratio - Answer total liabilities/total equity
times interest earned ratio - Answer EBIT over interest expense.
Capital Asset Pricing Model (CAPM) - Answer Model used to determine risk-
return relationship for an asset
Operating income Return on Investment - Answer Activity ratio: Operating
Income/Total Assets
, Accounting vs. Finance - Answer Accounting is backwards looking and finance
is forward
investment institution - Answer Financial firm, such as a mutual fund or a
hedge fund, that raises funds to invest in loans and securities.
Provides individuals and firms access to financial markets to buy and sell financial
securities
moral standards - Answer principles that reflect personal beliefs
How Lender preventing risk - Answer Set strict covenant that the company
can't uphold if it chooses a risky project
Ethics - Answer Accepted standards of conduct
Benefits of compounding interest - Answer Allows lender to gain interest on
interest. Detriment because it causes borrower to pay same
yield curve - Answer a graph showing the relationship between bond yields and
maturities.
If long term rate is < short term it's inverted and may indicate downturn
lagging indicators - Answer indicators that seem to lag behind changes in
overall business activity
MANAGERS STUDY GUIDE WITH
QUESTIONS AND CORRECT VERIFIED
ANSWERS GRADED A+ || 100%
GUARANTEED PASS NEWEST VERSION
EBIT - Answer Earnings before interest and taxes. Used to consider operating
earnings.
debt ratio - Answer Total liabilities over total assets.
The remaining amount is either equity or retained earnings.
0.3 means 30% of assets are financed through debt.
Debt to Equity Ratio - Answer total liabilities/total equity
times interest earned ratio - Answer EBIT over interest expense.
Capital Asset Pricing Model (CAPM) - Answer Model used to determine risk-
return relationship for an asset
Operating income Return on Investment - Answer Activity ratio: Operating
Income/Total Assets
, Accounting vs. Finance - Answer Accounting is backwards looking and finance
is forward
investment institution - Answer Financial firm, such as a mutual fund or a
hedge fund, that raises funds to invest in loans and securities.
Provides individuals and firms access to financial markets to buy and sell financial
securities
moral standards - Answer principles that reflect personal beliefs
How Lender preventing risk - Answer Set strict covenant that the company
can't uphold if it chooses a risky project
Ethics - Answer Accepted standards of conduct
Benefits of compounding interest - Answer Allows lender to gain interest on
interest. Detriment because it causes borrower to pay same
yield curve - Answer a graph showing the relationship between bond yields and
maturities.
If long term rate is < short term it's inverted and may indicate downturn
lagging indicators - Answer indicators that seem to lag behind changes in
overall business activity
