What Problem Arises If the Relationship Between Cause and Effect

question 11

Multiple Choice

What problem arises if the relationship between cause and effect is not determined in a performance audit?

• A)The impact on the financial report cannot be determined.
• B)The audit cannot proceed.
• C)The criteria cannot be established.
• D)A recommendation cannot be made to address the cause of the problem.

---

Definitions:

Nonprice Rationing

Nonprice rationing is the allocation of goods or services using means other than price, such as waiting times or ration coupons, especially when there are shortages.

Coupons

Vouchers entitling the holder to a discount off a particular product or service.

Favored Customers

Customers who receive preferential treatment from sellers, often through better prices, terms, or product availability.

Misallocation

The inefficient distribution of resources in an economy.