WGU D076 CORE MAIN EXAM QUESTIONS AND
ANSWERS SURE A+
✔✔Efficient market - ✔✔A market in which prices fully reflect all the available
information about a specific security.Go To
✔✔Estates - ✔✔Everything that a person owns or controls, especially at death.Go To
✔✔Ethical Dilemma - ✔✔An issue in the process of deciding between multiple options
where no option is completely acceptable from an ethical standpoint.Go To
✔✔Ethics - ✔✔Following accepted standards of moral conduct.Go To
✔✔Expected Return - ✔✔A hypothesized estimate of future prices or returns under
different scenarios based on expectational data.Go To
✔✔External Financing Needed (EFN) - ✔✔Another name for the discretionary financing
needed or additional funds needed. It represents the additional financing needed given
a firm's expectations for future growth.Go To
✔✔Face Value - ✔✔The sum of money that a corporation promises to pay at the
expiration of a bond; also called par value.Go To
✔✔Finance - ✔✔The study of managing and allocating funds at the personal or
business level.Go To
✔✔Financial Institutions - ✔✔An area of finance that includes firms or organizations that
exist to accept a wide variety of deposits, to offer investment products to individuals and
businesses, to provide loans, or to broker financial transactions.Go To
✔✔Financial Managers - ✔✔A person who makes strategic financial decisions in a
corporation.Go To
, ✔✔Financial Policy Implementation - ✔✔Incorporating new finance ideas within a
firm.Go To
✔✔Financial Risk - ✔✔Increased volatility in earnings as a result of using debt.Go To
✔✔Firm-specific Risk - ✔✔Risk that results from factors at a particular firm and can be
reduced through diversification; also called nonsystematic risk or idiosyncratic risk.Go
To
✔✔Fisher Effect - ✔✔An economic theory developed by Irving Fisher holding that the
real interest rate is equivalent to the nominal interest rate minus the expected inflation
rate.Go To
✔✔Fixed Asset Turnover (FAT) - ✔✔An activity ratio found by sales divided by fixed
assets.Go To
✔✔Fixed Expenditures - ✔✔An expense that you do not have direct control over and
that remains constant from period to period.Go To
✔✔Fixed-income Securities - ✔✔Another name for bonds; a financial security in which
the borrower pays a fixed interest payment to investors each year.Go To
✔✔Future Value - ✔✔The worth of cash flows in terms of the dollar amount in the
relative future.Go To
✔✔Gordon Growth Model - ✔✔A formula used to value common stock based on the
assumptions that dividends are paid every year and grow at constant rate forever.Go To
✔✔Gross Margin - ✔✔A profitability ratio found by gross profit divided by sales.Go To
✔✔Bondholders are primarily interested in making sure they will be paid back. - ✔✔Why
would bondholders set bond contracts that are very strict to deter the company from
taking on risky projects?
✔✔Safe projects with a higher chance of providing sufficient compensation - ✔✔Which
kind of projects are bondholders interested in?
✔✔Consider all stakeholders involved - ✔✔What is the third step in finding a solution to
an ethical dilemma?
✔✔Aligning managers' interests with shareholders' interests - ✔✔How can agency costs
be mitigated?
ANSWERS SURE A+
✔✔Efficient market - ✔✔A market in which prices fully reflect all the available
information about a specific security.Go To
✔✔Estates - ✔✔Everything that a person owns or controls, especially at death.Go To
✔✔Ethical Dilemma - ✔✔An issue in the process of deciding between multiple options
where no option is completely acceptable from an ethical standpoint.Go To
✔✔Ethics - ✔✔Following accepted standards of moral conduct.Go To
✔✔Expected Return - ✔✔A hypothesized estimate of future prices or returns under
different scenarios based on expectational data.Go To
✔✔External Financing Needed (EFN) - ✔✔Another name for the discretionary financing
needed or additional funds needed. It represents the additional financing needed given
a firm's expectations for future growth.Go To
✔✔Face Value - ✔✔The sum of money that a corporation promises to pay at the
expiration of a bond; also called par value.Go To
✔✔Finance - ✔✔The study of managing and allocating funds at the personal or
business level.Go To
✔✔Financial Institutions - ✔✔An area of finance that includes firms or organizations that
exist to accept a wide variety of deposits, to offer investment products to individuals and
businesses, to provide loans, or to broker financial transactions.Go To
✔✔Financial Managers - ✔✔A person who makes strategic financial decisions in a
corporation.Go To
, ✔✔Financial Policy Implementation - ✔✔Incorporating new finance ideas within a
firm.Go To
✔✔Financial Risk - ✔✔Increased volatility in earnings as a result of using debt.Go To
✔✔Firm-specific Risk - ✔✔Risk that results from factors at a particular firm and can be
reduced through diversification; also called nonsystematic risk or idiosyncratic risk.Go
To
✔✔Fisher Effect - ✔✔An economic theory developed by Irving Fisher holding that the
real interest rate is equivalent to the nominal interest rate minus the expected inflation
rate.Go To
✔✔Fixed Asset Turnover (FAT) - ✔✔An activity ratio found by sales divided by fixed
assets.Go To
✔✔Fixed Expenditures - ✔✔An expense that you do not have direct control over and
that remains constant from period to period.Go To
✔✔Fixed-income Securities - ✔✔Another name for bonds; a financial security in which
the borrower pays a fixed interest payment to investors each year.Go To
✔✔Future Value - ✔✔The worth of cash flows in terms of the dollar amount in the
relative future.Go To
✔✔Gordon Growth Model - ✔✔A formula used to value common stock based on the
assumptions that dividends are paid every year and grow at constant rate forever.Go To
✔✔Gross Margin - ✔✔A profitability ratio found by gross profit divided by sales.Go To
✔✔Bondholders are primarily interested in making sure they will be paid back. - ✔✔Why
would bondholders set bond contracts that are very strict to deter the company from
taking on risky projects?
✔✔Safe projects with a higher chance of providing sufficient compensation - ✔✔Which
kind of projects are bondholders interested in?
✔✔Consider all stakeholders involved - ✔✔What is the third step in finding a solution to
an ethical dilemma?
✔✔Aligning managers' interests with shareholders' interests - ✔✔How can agency costs
be mitigated?
