Which of the Following Is True About Using Sample Data

question 20

Multiple Choice

Which of the following is true about using sample data?

• A) All samples have the same characteristics and hence always adequately represent the underlying population.
• B) It can limit the ability to predict uncertain events that may occur because potential values outside the range of the sample data are not included.
• C) It is better to use sample data than trying to identify the underlying probability distribution and fitting a theoretical distribution to it.
• D) Using sample data in a decision model increases the ability to predict uncertain events.

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Definitions:

IFRS

International Financial Reporting Standards, which are a set of accounting rules followed by companies across the globe for maintaining their financial statements.

Indirect Method

A method used in cash flow statements to adjust net income for the changes in non-cash accounts to arrive at operating cash flows.

Net Income

The total profit or earnings of a company after all expenses and taxes have been deducted from revenues.