Final answer:
Fair value measurement relies on the notion of an exit price rather than an entry price notion to measure fair value.
Step-by-step explanation:
The statement is True. Fair value measurement does rely on the notion of an exit price rather than an entry price notion to measure fair value.
Fair value is the price at which an asset could be exchanged or a liability settled in an orderly transaction between market participants at the measurement date. The exit price is the price at which an asset or liability would be sold or transferred in the current market, while the entry price is the price at which an asset or liability was initially acquired.
For example, if a company is valuing its inventory at fair value, it would use the exit price to determine the current market value of the inventory, rather than the price it initially paid to acquire the inventory.