The Choice of Using Audit Sampling Versus Audit Data Analytics

question 96

Multiple Choice

The choice of using audit sampling versus audit data analytics (ADA) is often a matter of _______.

• A)determining which method management would prefer the auditor use
• B)what is most effective and efficient in determining whether a control is presented fairly, in all material respects
• C)what is most effective and efficient in determining whether an assertion is presented fairly, in all material respects
• D)which method will be more cost efficient for the client

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Definitions:

Monopolist's Demand Curve

A graphical representation showing how the quantity demanded by the market varies with price, uniquely for monopolies where the firm's demand curve is also the market demand curve.

Elastic

A description of a situation in which the supply or demand for a product is highly responsive to changes in price, indicating sensitivity in the quantity supplied or demanded.

Monopolistically Competitive

Refers to a market structure where many firms sell products that are similar but not identical, allowing for some degree of market power.

Purely Competitive

A market scenario where the selling price of products is determined by the overall supply and demand, with numerous sellers and homogeneous products.