Which of the Following Models Is Associated with Level 3

question 74

Multiple Choice

Which of the following models is associated with Level 3 in the FASB hierarchy for ascertaining fair value?

• A)Mark to market model.
• B)Replacement model.
• C)Mark to model.
• D)Historical cost model.

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Definitions:

Positive/Negative Analysis

An evaluative process that assesses the positive and negative outcomes or impacts of a decision or situation.

Risk Analysis

The process of identifying, assessing, and prioritizing risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability or impact of unfortunate events.

Capital Budgeting

The process by which businesses evaluate and prioritize investments in projects and acquisitions to maximize their long-term value.

Decision Tree Analysis

An analytical method that uses a decision tree structure to evaluate the outcomes of different decision paths, incorporating branches for uncertainty, resource costs, and potential returns.