An Advantage of Using Statistical Over Nonstatistical Sampling Methods in Tests

question 65

Multiple Choice

An advantage of using statistical over nonstatistical sampling methods in tests of controls is that the statistical methods:

• A)afford greater assurance than a nonstatistical sample of equal size.
• B)provide an objective basis for quantitatively evaluating sample risks.
• C)can more easily convert the sample into a dual-purpose test useful for substantive testing.
• D)eliminate the need to use judgment in determining appropriate sample sizes.

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Definitions:

Compensation

Total of all payments and benefits, including salary and bonuses, given to an employee for their services.

Expected Price Levels

Predictions or forecasts about the level of prices for goods and services in the future.

Aggregate Demand Curve

A graphical representation that shows the inverse relationship between the overall price level and the total output demanded in the economy.

Real GDP

measures the value of all final goods and services produced within a country in a given period, adjusted for inflation.