WGU D076 FINANCE SKILLS FOR MANAGERS
QUESTIONS AND SOLUTIONS
◉ FINANCIAL ENVIRONMENT
What is the main question that both individuals and companies must
consider when making financial decisions to reach a goal?
1. Will utility be maximized through this decision?
2. Will this decrease the amount of cash available?
3. Will this decision require debt or equity financing?
4. Will the benefits of the action outweigh the costs?.
Answer: 3. Will this decision require debt or equity financing?
◉ FINANCIAL ENVIRONMENT
A financial manager at a company is trying to determine whether to
issue new stocks or new bonds to cover the costs of a project the
company is doing the next year.
Which main task in business finance is this situation an example of?
,1. Making financing decisions
2. Managing working capital
3. Making investment decisions
4. Managing interdepartmental loans.
Answer: 1. Making financing decisions
◉ FINANCIAL ENVIRONMENT
How can investing help a person reach personal financial goals?
1. It helps a person understand how money was spent previously in
order to reliably predict future expenses.
2. It ensures money is placed in a safe, risk-free, and easily accessible
financial asset.
3. It provides access to potential revenue or increases in value to
help meet goals faster.
,4. It provides a guaranteed future outcome in order to predictably
meet financial goals..
Answer: 3. It provides access to potential revenue or increases in
value to help meet goals faster.
◉ FINANCIAL ENVIRONMENT
A sign company is planning to have an initial public offering (IPO). In
which type of market will its stock first be sold to the public?
1. Primary market
2. Efficient market
3. Secondary market
4. Money market.
Answer: 1. Primary market
◉ FINANCIAL ENVIRONMENT
Which type of economic indicator changes after the economy
changes and helps identify trends in the long term?
1. Coincident indicator
, 2. Yield curve indicator
3. Lagging indicator
4. Leading indicator.
Answer: 3. Lagging indicator
◉ FINANCIAL ENVIRONMENT
How does an investment institution, such as a mutual fund, facilitate
the circulation of money in the economy?
1. By raising capital on a contractual basis, such as an insurance
contract
2. By providing individuals and firms access to financial markets to
buy or sell financial securities
3. By insuring deposits in investment accounts up to $250,000 to
promote public confidence
4. By accepting deposits of money, paying interest on deposits, and
providing loans to individuals and organizations.
QUESTIONS AND SOLUTIONS
◉ FINANCIAL ENVIRONMENT
What is the main question that both individuals and companies must
consider when making financial decisions to reach a goal?
1. Will utility be maximized through this decision?
2. Will this decrease the amount of cash available?
3. Will this decision require debt or equity financing?
4. Will the benefits of the action outweigh the costs?.
Answer: 3. Will this decision require debt or equity financing?
◉ FINANCIAL ENVIRONMENT
A financial manager at a company is trying to determine whether to
issue new stocks or new bonds to cover the costs of a project the
company is doing the next year.
Which main task in business finance is this situation an example of?
,1. Making financing decisions
2. Managing working capital
3. Making investment decisions
4. Managing interdepartmental loans.
Answer: 1. Making financing decisions
◉ FINANCIAL ENVIRONMENT
How can investing help a person reach personal financial goals?
1. It helps a person understand how money was spent previously in
order to reliably predict future expenses.
2. It ensures money is placed in a safe, risk-free, and easily accessible
financial asset.
3. It provides access to potential revenue or increases in value to
help meet goals faster.
,4. It provides a guaranteed future outcome in order to predictably
meet financial goals..
Answer: 3. It provides access to potential revenue or increases in
value to help meet goals faster.
◉ FINANCIAL ENVIRONMENT
A sign company is planning to have an initial public offering (IPO). In
which type of market will its stock first be sold to the public?
1. Primary market
2. Efficient market
3. Secondary market
4. Money market.
Answer: 1. Primary market
◉ FINANCIAL ENVIRONMENT
Which type of economic indicator changes after the economy
changes and helps identify trends in the long term?
1. Coincident indicator
, 2. Yield curve indicator
3. Lagging indicator
4. Leading indicator.
Answer: 3. Lagging indicator
◉ FINANCIAL ENVIRONMENT
How does an investment institution, such as a mutual fund, facilitate
the circulation of money in the economy?
1. By raising capital on a contractual basis, such as an insurance
contract
2. By providing individuals and firms access to financial markets to
buy or sell financial securities
3. By insuring deposits in investment accounts up to $250,000 to
promote public confidence
4. By accepting deposits of money, paying interest on deposits, and
providing loans to individuals and organizations.
