Before Selecting a Sample, It Is Necessary to Specify the Expected

question 9

Multiple Choice

Before selecting a sample, it is necessary to specify the expected error. The main purpose for doing this is:

• A) it is necessary in determining sampling risk.
• B) it is necessary to compare it to the previous year.
• C) it is the maximum amount that can be misstated where the auditor can still conclude that the account is fairly stated.
• D) it is important in determining sample size.

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Definitions:

F-statistic

A ratio used in statistical analysis to assess the significance of a group of variables in a regression model relative to the variation unexplained by the model.

Degrees of Freedom

The number of independent values or quantities that can vary in the analysis of statistical data.

Treatments

The different levels or categories of the independent variable applied in an experiment.

Sum of Squared Errors

The total of the squared differences between the observed values and the values predicted by a model or the mean.