In Practice,auditors Rarely Assign Numerical Probabilities to Inherent Risk,control Risk,or

question 42

Essay

In practice,auditors rarely assign numerical probabilities to inherent risk,control risk,or acceptable audit risk.It is more common to assess these risks as high,medium,or low.For each of the four situations below,fill in the blanks for planned detection risk and the amount of evidence you would plan to gather ("planned evidence")using the terms high,medium,or low.

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Definitions:

Bread

A staple food made from a dough of flour and water, usually by baking.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two goods, given a set of inputs, representing the trade-off between the two goods.

Consumption Possibilities Frontier

A curve depicting all possible combinations of two goods or services that a consumer can purchase given their income and the prices of the goods.

Self-sufficient Producer

An individual or entity that produces all they need to consume, relying minimal on external sources for goods or services.