NACVA Exam CVA Topic 1 Question 89 Discussion

Actual exam question for NACVA's CVA exam

Question #: 89
Topic #: 1

[All CVA Questions]

The discount rate is a market-driven rate. It represents the expected yield rate-or rate of return-necessary to induce:

AInvestors to commit available funds to the subject investment, given its level of risk

BYield rate

CDividends

DInvestment yield

Show Suggested Answer

Suggested Answer: C

by Eleonore at Jun 23, 2024, 04:57 PM

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Galen

3 months ago

The discount rate? More like the 'discourage me from investing' rate, am I right? Let's just go with A and call it a day.

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Jeannine

2 months ago

Let's stick with option A, it makes the most sense in this context.

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Denna

2 months ago

Investors need to be enticed to commit funds, that's why the discount rate is important.

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Elenor

3 months ago

I agree, the discount rate can be discouraging.

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Elouise

4 months ago

Wait, is the discount rate the same as the 'rate of return'? I'm going to have to consult my magic 8-ball on this one.

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Barbra

3 months ago

C) Dividends

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Cassandra

3 months ago

B) Yield rate

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Karima

3 months ago

A) Investors to commit available funds to the subject investment, given its level of risk

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Jesusita

4 months ago

Ah, the old 'rate of return' trick question. A is definitely the way to go here. Discount rate 101, folks!

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Nida

2 months ago

A is the best choice here. It's all about the rate of return necessary to get investors on board.

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Brett

3 months ago

I think A makes the most sense. It's about the expected yield rate needed to entice investors.

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Malika

4 months ago

Definitely, the discount rate is crucial for attracting investors. A is the way to go.

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Stefania

4 months ago

I agree, A is the correct answer. It's all about inducing investors to commit funds.

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Charlena

4 months ago

I'm not sure, but I think it's related to the expected yield rate. So maybe B) Yield rate could also be a possible answer.

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Ailene

4 months ago

I agree with Alise. The discount rate needs to be high enough to attract investors to take on the risk of the investment.

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Nidia

4 months ago

Hmm, I'm not sure if B, C, or D are just synonyms for the discount rate. I'll have to think this one through carefully.

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Deane

3 months ago

Hmm, I think option A is the correct answer. It makes sense that the discount rate would be based on the expected yield rate needed to attract investors based on the level of risk.

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Floyd

3 months ago

A) Investors to commit available funds to the subject investment, given its level of risk

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Lon

4 months ago

The discount rate represents the expected yield rate necessary to attract investors, so A is the correct answer. Easy peasy!

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Truman

2 months ago

Definitely, the discount rate is crucial in determining the expected yield rate for investors.

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Zena

2 months ago

So, A) Investors to commit available funds to the subject investment, given its level of risk, is the right choice.

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Tori

3 months ago

I agree, the discount rate is all about getting investors to commit funds to the investment.

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Corrie

4 months ago

I think A is the correct answer because the discount rate is what attracts investors.

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Alise

4 months ago

I think the answer is A) Investors to commit available funds to the subject investment, given its level of risk.

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