Which of the following is not an example of a level 2 input:
A) A financial forecast of cash flow or earnings.
B) Quoted prices for identical or similar assets or liabilities in markets that are not active.
C) Inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves, volatilities, prepayment speeds, and credit risks.
D) Inputs that are derived from or corroborated by observable market data by correlation or other means.

Question

Quizplus · Accepted Answer

A financial forecast of cash flow or earnings is not a level 2 input because it is not based on observable market data. Level 2 inputs are those that are observable, either directly or indirectly, such as quoted prices in inactive markets or inputs that are corroborated by market data.

Which of the Following Is Not an Example of a Level