Which of the Following Best Describe the Term Forecasting Risk

question 118

Multiple Choice

Which of the following best describe the term forecasting risk.

• A) The percentage change in operating cash flow relative to the percentage change in quantity sold.
• B) The sales level that results in a zero NPV.
• C) Costs that do not change when the quantity of output changes during a particular time period.
• D) The possibility that errors in projected cash flows lead to incorrect decisions.
• E) Opportunities that managers can exploit if certain things happen in the future.

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Definitions:

Sample Point

An individual element or possible outcome in a sample space, representing a possible result of an experiment or trial.

Population

A complete set of items or individuals with at least one common characteristic, used in statistics for analysis and inference.

Multiplication Law

A probability law used to compute the probability of the intersection of two events. It is P(A ∩ B) = P(B)P(A ∣ B) or P(A ∩ B) = P(A)P(B ∣ A). For independent events it reduces to P(A ∩ B) = P(A)P(B).

Mutually Exclusive

Events that cannot occur at the same time; the occurrence of one event excludes the possibility of the other event(s).