Question

Which approach to measuring fair value uses information from actively traded stock on the New York Stock Exchange?

Answer 1

Fair Value Measurement Approach:

Market approach

Step-by-step explanation:

Fair value can be measured using any of the three approaches recognized by the standard. They include the market approach, the cost approach, and the income approach. The market approach particularly uses information from the market prices of similar stock to measure the fair value of a particular stock, after adjusting for minor differences. Like the other two methods, the market approach is consistent with the going concern assumption.