Nonprobabilistic Selection Methods Are Not Based on Mathematical Probabilities; Therefore

question 45

Multiple Choice

Nonprobabilistic selection methods are not based on mathematical probabilities; therefore:

• A)the extent to which a sample is representative of the population may be difficult to determine.
• B)they are discouraged by the AICPA.
• C)they are not allowed by the Statements on Auditing Standards.
• D)they are not as effective as statistical sampling.

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Definitions:

Used Cars

Second-hand vehicles that were once registered and utilized by one or more prior owners.

Marginal Products

The extra output that is produced by using one more unit of a particular input, holding all other inputs constant.

Separating Equilibrium

Separating equilibrium occurs in a game or market when different types of participants choose distinctly different strategies or products, revealing their type.

Pooling Equilibrium

A situation in a market where all agents, regardless of their type or quality, provide the same signal, making it impossible to distinguish between them based on that signal alone.