Discount Rate Policy Is Most Often

question 143

Multiple Choice

Discount rate policy is most often

• A)lowered when market rates rise.
• B)used to actively control the money supply.
• C)the Fed's primary tool of monetary control.
• D)passively changed by the Fed to follow market rates.

Determine the carrying value of an investment under the equity method.

Record and report dividends received from an investment using the equity method.

Recognize and measure the impairment of an investment and its subsequent recovery under IFRS.

Understand the distinction between investments accounted for using the equity method and those accounted under FVTPL and FVTOCI.

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Definitions:

Outstanding Balance

The outstanding balance is the total amount still owed on a loan or credit line, including any interest or fees that have accrued.

Credit Period

The time period granted to a customer for paying an invoice.

Stock Price

The current market price at which a share of a company's stock can be bought or sold.

Discount Rate

In finance, it is the interest rate used to determine the present value of future cash flows, or the rate at which a bank lends to other banks or financial institutions.