Table 22-2 Three Longtime Friends-Allen, Brian, and Cody-Are Deciding How They Will

question 208

Multiple Choice

Table 22-2
Three longtime friends-Allen, Brian, and Cody-are deciding how they will spend their Sunday afternoon. They all agree that they should do one of three things: go to a movie, play golf, or go to a baseball game. They also agree that they will have two pairwise votes to determine how to spend their afternoon, with the majority determining the outcome on each vote. The first, second, and third choices for each person are as indicated in the table below.
-Refer to Table 22-2. If (1) the first vote pits "baseball game" against "golf," and (2) the second vote pits "movie" against the winner of the first vote, then

• A)"Baseball game" wins the first vote and "baseball game" wins the second vote, so they go to a baseball game.
• B)"Baseball game" wins the first vote and "movie" wins the second vote, so they go to a movie.
• C)"golf" wins the first vote and "golf" wins the second vote, so they play golf.
• D)"golf" wins the first vote and "movie" wins the second vote, so they go to a movie.

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Definitions:

Going Concern

The assumption that an entity will continue its operations in the foreseeable future and not go bankrupt or be forced to stop operations.

Financial Statements

Documents that provide an overview of a company's financial condition, including balance sheets, income statements, and cash flow statements.

Fundamental Qualitative

This term is incomplete without referencing specific context, but it often relates to the essential qualitative characteristics that information must possess to be useful in decision making, such as relevance and faithful representation.

Faithful Representation

A qualitative characteristic of financial information that ensures it accurately depicts the economic phenomena it represents.