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WGU D076 Questions and Correct Answers
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WGU D076 Questions and Correct Answers
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WGU D076 Questions and Correct AnswersWhich area of finance deals with sources of funding and the capital structure of
corporations and seeks to increase the value of a firm to its owners?
✓ ~~~ Business finance
What is the primary difference between finance and accounting?
✓ ~~~ Finance focuses on the future, while accounting is generally backward-looking.
Which subspecialty of finance primarily involves deciding which assets will create
more wealth and earn positive returns?
✓ ~~~ Investments
An area of finance that deals with investment allocation and asset pricing.
✓ ~~~ Investments
An area of finance that involves organizations that accept deposits, offer investment
products, loan money, or broker financial transactions.
✓ ~~~ Financial Institutions
An area of finance that involves activities used to increase shareholder wealth.
✓ ~~~ Corporate Finance.
What is the primary aim of personal finance goals?
, ✓ ~~~ To maximize satisfaction from products purchased and services obtained
What should be the main question a firm asks when considering any investment
decision?
✓ ~~~ Do the benefits of this investment outweigh the costs?
What is the primary goal of the financial manager of a firm?
✓ ~~~ To maximize owner wealth
What are three main tasks that a financial manager of a firm does in order to achieve
the goal of the firm, which is to maximize shareholder wealth?
✓ ~~~ making investment decisions,
making financing decisions, and
managing working capital.
Who is the highest ranking officer in corporate finance?
✓ ~~~ CFO, Chief Financial Officer
What does the CFO do?
✓ ~~~ The CFO is responsible for all the financial decisions made by the firm. He or
she serves as the CEO's right-hand person in all money matters and oversees the
financial analysis and decision-making of the firm.
Which task does a financial manager perform when assessing the costs and benefits
of potential projects?
, ✓ ~~~ Making investment decisions
Which financial career focuses on investing capital into firms whose shares are not
currently sold on any public stock exchange?
✓ ~~~ Private equity
Which task does a financial manager perform when choosing to obtain a loan to
purchase a piece of equipment for a new project?
✓ ~~~ Making financing decisions
What are the three most important types of securities?
✓ ~~~ Treasury, Corporate, and Stocks
Why does the SEC oversee Financial Markets?
✓ ~~~ To protect Investors
What are the purposes of financial markets?
✓ ~~~ To provide liquidity and determine prices
In which financial market are securities such as stocks and bonds are traded after
their initial issuance?
✓ ~~~ Secondary market
, What kind of market primarily allows institutions to borrow and lend in the short
term?
✓ ~~~ Money market
A local start-up company just hit its five-year anniversary and is planning an initial
public offering sometime this year. In order to issue public stock, which market will
the company use?
✓ ~~~ Primary market
What is a depository institution?
✓ ~~~ An institution that accepts and pays interest on deposits of money, as well as
extends loans
What is the primary role of financial institutions?
✓ ~~~ To conduct financial transactions such as investments, loans, and deposits
A large corporation is looking to merge with another large corporation. Which
financial institution can help them do this?
✓ ~~~ Investment bank
Which type of financial institution deals mainly with providing for retirement through
employers?
✓ ~~~ Pension fund
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