Question 1

____________ is perhaps the most difficult task for the business appraiser.

Options :

A : Getting two or more parties with different economic and business expectations to agree on projected future benefits and the risks associated with achieving those projections.

B : Identification of partial interest.

C : Selection of enterprise value premise.

D : Estimation of invested capital

Answer: A

Question 2

Which one of the following is/are example/s of normalizing adjustments?

Options :

A : Adequacy of allowance and reserve accounts

B : Non-depreciation methods and schedules

C : Policies regarding capitalization or expensing of various costs (adjust to industry norms)

D : Changes in capital structure

Answer: A,C

Question 3

The FASB says that, for ''unobservable inputs,'' the valuation should include market participant assumptions about risk, even if this adjustment is different to determine. Interestingly, it breaks risk into following categories EXCEPT:

Options :

A : The risk inherent in a particular valuation technique

B : The risk inherent in inputs of the valuation technique

C : The explicit risk related to a particular valuation technique

D : The implicit risk related to a particular valuation technique

Answer: C,D

Question 4

Market evidence indicated that adjustable-rate preferred stocks generally required yields in the range of ______________ basic points.

Options :

A : 42 to 445

B : 48-498

C : 32-500

D : 50-500

Answer: A

Question 5

___________ may apply to publicly traded stock where the size of the block is large enough relative to normal trading volume that it could not be sold in a short time without depressing the market price.

Options :

A : Discounts for lack of control

B : Blockage discounts

C : Discounts for lack of marketability

D : Contingent liability discounts

Answer: B

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