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WGU C213 FINAL EXAM ACCOUNTING FOR DECISION
MAKERS VERSION 1 & 2 NEWEST 2025/2026 NEWEST
ACTUAL EXAM WITH COMPLETE QUESTIONS AND
VERIFIED ANSWERS |ALREADY GRADED A+|
When is a company that has strong operating revenues and
competent management a good investment?
A. When the intrinsic value of the price per share is higher than
the current stock price
B. When the intrinsic value of the price per share is lower than the
current stock price
C. When the current stock price is currently equal to the intrinsic
value
D. When the current stock price is overvalued relative to the
intrinsic value - ANSWER-A. When the intrinsic value of the price
per share is higher than the current stock price
Thinking about levels of market efficiency quadrants. Which
investment option should be selected assuming a prudent
investor wants to maximize their expected return E(R)? Quad 1;
Quad 2; Quad 3; Quad 4
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A. A
B. B
C. C
D. D
E. E - ANSWER-A. A
Which security type includes the right to vote for a board of
directors?
A. Preferred stock
B. Money market funds
C. Bonds
D. Common stock - ANSWER-D. Common stock
Economists forecast the probability of recession at 22%. During
periods of recession, returns for a company have been -2%.
Returns for the company have been 18% during an expansionary
period. What is the forecast probability of an expansionary
period?
A. 80%
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B. 78%
C. 76%
D. 82% - ANSWER-B. 78%
What makes the "efficient frontier" efficient?
A. It always produces the minimum risk
B. It disregards risk to produce the maximum return
C. It provides the highest level of risk for a given return
D. It maximizes the ratio of expected return to risk - ANSWER-D.
It maximizes the ratio of expected return to risk
What are 3 components required in calculating weighted average
cost of capital (WACC)?
A. The market cap of the company
B. The desired growth rate
C. The amount and required return for common equity, preferred
equity and debt
D. The marginal tax rate
E. The value of preferred stock and debt
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F. The firm's market value
G. The combined total expected growth rate - ANSWER-d The
marginal tax rate
e The value of preferred stock and debt
f The firm's market value
What advantage does the Gordon growth model have compared
to the capital asset pricing model (CAPM)?
A. It requires assumptions about growth that benefit fast growing
companies
B. It provides an easier to understand and relatively accurate
forecast when growth rates are stable
C. It is highly accurate in predicting future growth
D. It requires the use of accurate known factors, such as future
growth rates - ANSWER-B. It provides an easier to understand
and relatively accurate forecast when growth rates are stable
How does the weighted average cost of capital affect a company's
growth opportunities?
WGU C213 FINAL EXAM ACCOUNTING FOR DECISION
MAKERS VERSION 1 & 2 NEWEST 2025/2026 NEWEST
ACTUAL EXAM WITH COMPLETE QUESTIONS AND
VERIFIED ANSWERS |ALREADY GRADED A+|
When is a company that has strong operating revenues and
competent management a good investment?
A. When the intrinsic value of the price per share is higher than
the current stock price
B. When the intrinsic value of the price per share is lower than the
current stock price
C. When the current stock price is currently equal to the intrinsic
value
D. When the current stock price is overvalued relative to the
intrinsic value - ANSWER-A. When the intrinsic value of the price
per share is higher than the current stock price
Thinking about levels of market efficiency quadrants. Which
investment option should be selected assuming a prudent
investor wants to maximize their expected return E(R)? Quad 1;
Quad 2; Quad 3; Quad 4
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A. A
B. B
C. C
D. D
E. E - ANSWER-A. A
Which security type includes the right to vote for a board of
directors?
A. Preferred stock
B. Money market funds
C. Bonds
D. Common stock - ANSWER-D. Common stock
Economists forecast the probability of recession at 22%. During
periods of recession, returns for a company have been -2%.
Returns for the company have been 18% during an expansionary
period. What is the forecast probability of an expansionary
period?
A. 80%
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B. 78%
C. 76%
D. 82% - ANSWER-B. 78%
What makes the "efficient frontier" efficient?
A. It always produces the minimum risk
B. It disregards risk to produce the maximum return
C. It provides the highest level of risk for a given return
D. It maximizes the ratio of expected return to risk - ANSWER-D.
It maximizes the ratio of expected return to risk
What are 3 components required in calculating weighted average
cost of capital (WACC)?
A. The market cap of the company
B. The desired growth rate
C. The amount and required return for common equity, preferred
equity and debt
D. The marginal tax rate
E. The value of preferred stock and debt
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F. The firm's market value
G. The combined total expected growth rate - ANSWER-d The
marginal tax rate
e The value of preferred stock and debt
f The firm's market value
What advantage does the Gordon growth model have compared
to the capital asset pricing model (CAPM)?
A. It requires assumptions about growth that benefit fast growing
companies
B. It provides an easier to understand and relatively accurate
forecast when growth rates are stable
C. It is highly accurate in predicting future growth
D. It requires the use of accurate known factors, such as future
growth rates - ANSWER-B. It provides an easier to understand
and relatively accurate forecast when growth rates are stable
How does the weighted average cost of capital affect a company's
growth opportunities?
