When the Proper Disclosure in the Financial Statements of Material

question 4

Multiple Choice

When the proper disclosure in the financial statements of material contingencies is through footnotes, the footnote should describe the nature of the contingency to the extent it is known and the:

• A) auditor's opinion as to the expected outcome.
• B) steps the client has taken to ensure that it doesn't recur.
• C) opinion of legal advisers or management as to the expected outcome.
• D) opinion of an outside independent party, such as an appraiser, as to the expected outcome.

Distinguish between monopoly and monopsony power in markets.

Calculate deadweight loss, consumer surplus, and producer surplus in monopoly markets.

Understand the economic rationale for government intervention in natural monopolies.

Apply economic theory to recommend regulatory policies for monopolies.