Predicting Which Companies Are Likely to Have Misstated Financial Statements

question 46

Multiple Choice

Predicting which companies are likely to have misstated financial statements is an example of __________ in predictive analytics.

• A) classification
• B) prediction
• C) regression
• D) time series analysis

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Definitions:

Present Value Index

A ratio used to estimate the present value of an investment's benefits divided by the present value of its costs.

Net Cash Flow

The amount of cash generated or used by a company in a given period, calculated as cash inflows minus cash outflows.

Capital Investment

Funds spent by a company to purchase, maintain, or improve physical assets such as property, industrial buildings, or equipment.

Quantitative Measures

Metrics or data points that can be quantified numerically to assess performance, trends, or changes over time.