Which of the Following Best Describes the Test Data Approach

question 27

Multiple Choice

Which of the following best describes the test data approach?

• A) Auditors process their own test data using the client's computer system and application program.
• B) Auditors process their own test data using their own computers that simulate the client's computer system.
• C) Auditors use auditor-controlled software to do the same operations that the client's software does, using the same data files.
• D) Auditors use client-controlled software to do the same operations that the client's software does, using auditor created data files.

---

Definitions:

Competing Products

Goods or services that serve as alternatives to each other, satisfying the same need or want, and thus compete in the same market.

Elastic Demand

A condition where the quantity demanded of a good or service significantly changes due to a change in its price.

Inelastic Demand

A market scenario where the quantity demanded of a good or service changes minimally in response to price changes.

Perfectly Inelastic

A situation where the quantity demanded or supplied of a good does not change regardless of the changes in its price.