When Fair Valuing a Liability Which Factor Should NOT Be

question 14

Multiple Choice

When fair valuing a liability which factor should NOT be considered?

• A)Expectations of the market about fulfilling the obligation.
• B)Non-performance risk.
• C)The fair value of the corresponding asset.
• D)None of the above,i.e.they are all factors to consider.

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Definitions:

Individualism

A moral, political, or social outlook that emphasizes the moral worth of the individual and the importance of individual self-reliance and independence.

Norms

Understood rules for accepted and expected behavior. Norms prescribe “proper” behavior.

Negative Arousal

A state of being emotionally stimulated in a negative way, such as feeling stressed, angry, or scared, often leading to psychological discomfort.

Cognitive Dissonance

The mental discomfort experienced by an individual who holds two or more contradictory beliefs, ideas, or values.