WGU D076 EXAMS SCRIPT LATEST QUESTIONS
AND ANSWERS SURE A+
✔✔Market Ratios - ✔✔A category of ratios that are used to evaluate the current share
price of a public firm's stock.
✔✔Market Risk - ✔✔Risk that is inherent in the economy as a whole and cannot be
diversified away; also called systematic risk or nondiversifiable risk.
✔✔Market-to-book Ratio (M/B Ratio) - ✔✔A market ratio found by market value of
equity divided by book value of equity.
✔✔Marketing - ✔✔The business function responsible for generating sales
✔✔Maturity Date - ✔✔The date at which a bond expires.
✔✔Money Market - ✔✔A type of financial market used for short-term assets that are
held for less than one year.
✔✔Morals - ✔✔Following one's standards of right and wrong behavior.
✔✔Mutual Fund - ✔✔An investment company that continually offers investments and
buys financial securities and instruments on behalf of investors.
✔✔Mutually Exclusive - ✔✔When two or more events do not coincide.
✔✔NASDAQ - ✔✔A computer network where stocks are bought and sold. It is the
second-largest stock exchange in the world. Typically, technology-related companies
will go public through this exchange.
✔✔Negative Covenants - ✔✔A bond covenant that describes things the company
pledges itself not to do in order to protect bondholders.
, ✔✔Net Margin - ✔✔The percentage of sales remaining after all costs have been
deducted from a company's total sales. Also known as net profit margin; indicates the
profit earned by the firm.
✔✔New York Stock Exchange (NYSE) - ✔✔A physical trading floor and a computer
network where stocks are bought and sold. It is the largest stock exchange in the world.
✔✔Nominal Rate - ✔✔The rate at which invested money grows for a certain period of
time.
✔✔Nondiversifiable Risk - ✔✔Risk that is inherent in the economy as a whole and
cannot be diversified away; also called market risk or systematic risk.
✔✔Nonsystematic Risk - ✔✔Risk that results from factors at a particular firm and can
be reduced through diversification; also called firm-specific risk or idiosyncratic risk.
✔✔Operating Income Return On Investment (OIROI) - ✔✔An activity ratio found by
operating income divided by total assets.
✔✔Operating Margin - ✔✔A profitability ratio found by EBIT profit divided by sales.
✔✔Opportunity Cost - ✔✔The loss of potential gain from other alternatives when one
alternative is chosen.
✔✔Ordinary Annuity - ✔✔A series of equal payments made at the end of consecutive
periods over a fixed length of time.
✔✔Par Bond - ✔✔A bond whose price is exactly equal to its par value.
✔✔Par Value - ✔✔The sum of money that a corporation promises to pay at the
expiration of a bond; also called face value.
✔✔Payout Ratio - ✔✔The percent of net income distributed to the shareholders.
✔✔Pension Fund - ✔✔A financial institution that specializes in managing and
administering retirement funds.
✔✔Perpetuity - ✔✔A constant stream of identical cash flows that continues forever.
✔✔Perpetuity Model - ✔✔A formula used to value preferred stock that is based on the
calculation of a perpetuity.
AND ANSWERS SURE A+
✔✔Market Ratios - ✔✔A category of ratios that are used to evaluate the current share
price of a public firm's stock.
✔✔Market Risk - ✔✔Risk that is inherent in the economy as a whole and cannot be
diversified away; also called systematic risk or nondiversifiable risk.
✔✔Market-to-book Ratio (M/B Ratio) - ✔✔A market ratio found by market value of
equity divided by book value of equity.
✔✔Marketing - ✔✔The business function responsible for generating sales
✔✔Maturity Date - ✔✔The date at which a bond expires.
✔✔Money Market - ✔✔A type of financial market used for short-term assets that are
held for less than one year.
✔✔Morals - ✔✔Following one's standards of right and wrong behavior.
✔✔Mutual Fund - ✔✔An investment company that continually offers investments and
buys financial securities and instruments on behalf of investors.
✔✔Mutually Exclusive - ✔✔When two or more events do not coincide.
✔✔NASDAQ - ✔✔A computer network where stocks are bought and sold. It is the
second-largest stock exchange in the world. Typically, technology-related companies
will go public through this exchange.
✔✔Negative Covenants - ✔✔A bond covenant that describes things the company
pledges itself not to do in order to protect bondholders.
, ✔✔Net Margin - ✔✔The percentage of sales remaining after all costs have been
deducted from a company's total sales. Also known as net profit margin; indicates the
profit earned by the firm.
✔✔New York Stock Exchange (NYSE) - ✔✔A physical trading floor and a computer
network where stocks are bought and sold. It is the largest stock exchange in the world.
✔✔Nominal Rate - ✔✔The rate at which invested money grows for a certain period of
time.
✔✔Nondiversifiable Risk - ✔✔Risk that is inherent in the economy as a whole and
cannot be diversified away; also called market risk or systematic risk.
✔✔Nonsystematic Risk - ✔✔Risk that results from factors at a particular firm and can
be reduced through diversification; also called firm-specific risk or idiosyncratic risk.
✔✔Operating Income Return On Investment (OIROI) - ✔✔An activity ratio found by
operating income divided by total assets.
✔✔Operating Margin - ✔✔A profitability ratio found by EBIT profit divided by sales.
✔✔Opportunity Cost - ✔✔The loss of potential gain from other alternatives when one
alternative is chosen.
✔✔Ordinary Annuity - ✔✔A series of equal payments made at the end of consecutive
periods over a fixed length of time.
✔✔Par Bond - ✔✔A bond whose price is exactly equal to its par value.
✔✔Par Value - ✔✔The sum of money that a corporation promises to pay at the
expiration of a bond; also called face value.
✔✔Payout Ratio - ✔✔The percent of net income distributed to the shareholders.
✔✔Pension Fund - ✔✔A financial institution that specializes in managing and
administering retirement funds.
✔✔Perpetuity - ✔✔A constant stream of identical cash flows that continues forever.
✔✔Perpetuity Model - ✔✔A formula used to value preferred stock that is based on the
calculation of a perpetuity.
