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NACVA Exam CVA Topic 6 Question 115 Discussion

Actual exam question for NACVA's CVA exam
Question #: 115
Topic #: 6
[All CVA Questions]

The state of the art in the twenty-first century involves incorporating one or all of the following elements into the discount rate to reflect risk EXCEPT:

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Suggested Answer: D

Contribute your Thoughts:

Hildred
5 days ago
I'm not sure, I think it might be C) An element reflecting the size effect.
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Lorrie
7 days ago
D. None of these? Really? I'm pretty sure incorporating all of those elements is the state of the art in the 21st century. This question is a bit too easy, don't you think?
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Leigha
2 months ago
I agree with Dion, because all the other options involve incorporating risk elements into the discount rate.
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Gracia
2 months ago
I think the answer is B. Incorporating coefficients to modify the basic equity risk premium based on industry or other characteristics is a common way to reflect risk in the discount rate.
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Luther
7 days ago
I think it's actually C, reflecting the size effect in the discount rate.
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Javier
8 days ago
I agree, incorporating coefficients based on industry characteristics is important.
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Dion
2 months ago
I think the answer is D) None of these.
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