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When the Client Has a Large Number of Relatively Small

question 75

True/False

When the client has a large number of relatively small accounts receivable and the assessed level of control risk for receivables and related revenue transactions is high,the auditor is more likely to use negative confirmations.


Definitions:

Elasticity of Demand

The measure of how much the quantity demanded of a good responds to a change in the price of that good.

Perfectly Inelastic

A market situation where the quantity demanded or supplied does not change in response to a change in price.

Elasticity of Demand

An indicator of the responsiveness of the quantity of a product demanded to its price alterations.

Total Revenue

The total income a firm receives from the sale of its products, calculated as the price per unit times the number of units sold.

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