WGU D076 FINANCE SKILLS FOR
MANAGERS EXAM SCRIPT WITH VERIFIED
QUESTIONS AND ANSWERS
●● What is the main objective of personal financial goals?
Answer: To maximize individual utility
(Correct! You set goals and act to increase your satisfaction or happiness
by taking care of necessities and achieving priorities.)
●● Which task does the financial manager of a firm perform that
involves the issuance of new stocks and bonds?
Answer: Making financing decisions
(Correct! Once investment decisions are made, a financial manager
considers different possibilities of financing sources for the investments.
This may include issuing new stocks and bonds.)
●● Why is understanding the definition of finance important in
managing personal finances?
Answer: It helps individuals compare the costs and benefits of an action
to determine whether to take that action.
,(Correct! Any financial decision should make sense in terms of its costs
and benefits.)
●● In which type of market would a company issue bonds or stocks for
the first time?
Answer: Primary market
(Correct! This is the purpose of a primary market.)
●● Which type of financial institution is a mutual fund?
Answer: Investment institution
(Correct! Investment institutions provide individuals and firms access to
financial markets.)
●● Which financial institution specializes in managing and
administering retirement funds?
Answer: Pension funds
(Correct! Pension funds specialize in retirement funds.)
●● Which type of economic indicator is the consumer price index?
Answer: Lagging indicator
, (Correct! CPI usually changes after the economy as a whole changes.)
●● What does the term ethical refer to?
Answer: The accepted standards of conduct that guide a person's
behavior
(Correct! Ethical refers to the accepted standards of conduct that guide a
person's behavior.)
●● A company's officers and board of directors are selling their stocks in
the firm at higher prices due to false accounting reports that made the
stock seem more valuable than it truly was. Which ethical issue is
occurring in this situation?
Answer: Agency problem due to conflicting interests
(Correct! Accounting manipulation by management in pursuit of higher
stock-related compensation is an example of an agency problem.)
●● UNIT 3
What is another name for the cost of capital?
Answer: Discount rate
MANAGERS EXAM SCRIPT WITH VERIFIED
QUESTIONS AND ANSWERS
●● What is the main objective of personal financial goals?
Answer: To maximize individual utility
(Correct! You set goals and act to increase your satisfaction or happiness
by taking care of necessities and achieving priorities.)
●● Which task does the financial manager of a firm perform that
involves the issuance of new stocks and bonds?
Answer: Making financing decisions
(Correct! Once investment decisions are made, a financial manager
considers different possibilities of financing sources for the investments.
This may include issuing new stocks and bonds.)
●● Why is understanding the definition of finance important in
managing personal finances?
Answer: It helps individuals compare the costs and benefits of an action
to determine whether to take that action.
,(Correct! Any financial decision should make sense in terms of its costs
and benefits.)
●● In which type of market would a company issue bonds or stocks for
the first time?
Answer: Primary market
(Correct! This is the purpose of a primary market.)
●● Which type of financial institution is a mutual fund?
Answer: Investment institution
(Correct! Investment institutions provide individuals and firms access to
financial markets.)
●● Which financial institution specializes in managing and
administering retirement funds?
Answer: Pension funds
(Correct! Pension funds specialize in retirement funds.)
●● Which type of economic indicator is the consumer price index?
Answer: Lagging indicator
, (Correct! CPI usually changes after the economy as a whole changes.)
●● What does the term ethical refer to?
Answer: The accepted standards of conduct that guide a person's
behavior
(Correct! Ethical refers to the accepted standards of conduct that guide a
person's behavior.)
●● A company's officers and board of directors are selling their stocks in
the firm at higher prices due to false accounting reports that made the
stock seem more valuable than it truly was. Which ethical issue is
occurring in this situation?
Answer: Agency problem due to conflicting interests
(Correct! Accounting manipulation by management in pursuit of higher
stock-related compensation is an example of an agency problem.)
●● UNIT 3
What is another name for the cost of capital?
Answer: Discount rate
