If an Auditor Judgmentally Selects a Sample of One Hundred

question 72

Multiple Choice

If an auditor judgmentally selects a sample of one hundred items from a population and finds two exceptions, the auditor

• A) can conclude that the sample exception rate is 2%.
• B) can conclude that the population exception rate is 2%.
• C) can calculate the highest exception rate expected in the population.
• D) cannot make any conclusions about either the sample or the population.

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Definitions:

Aggregate Supply Curve

A graphical representation that shows the total quantity of goods and services that producers in an economy are willing and able to supply at different price levels.

Price Level

A measure of the average prices of goods and services in an economy, indicating the cost of living and inflation rates.

Explicit Resource Price

The monetary value that is directly paid for the use of a resource or asset, such as wages for labor or rent for land.

Aggregate Supply Curve

A graphical representation showing the relationship between the total supply of goods and services produced in an economy and the price level.