Which of the Following Is Most Likely to Constitute a Misstatement

question 54

Multiple Choice

Which of the following is most likely to constitute a misstatement that can give rise to fraud or misrepresentation liability?

• A)A broker says to his client,"I think that this car's engine has been overhauled."
• B)A customer sales representative of the most popular brand of car says to the customer,"This is the highest selling car in town."
• C)An owner of a house gets his ceiling painted to conceal a leaking roof and says,"I got the ceiling painted recently."
• D)The owner of an unencumbered horse states,"I am selling the horse to raise funds for my ranch."

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Definitions:

Normal Distribution

A bell-shaped distribution that is symmetric about the mean, where data near the mean are more frequent in occurrence than data far from the mean.

Sample

A subset of individuals from within a larger population used to approximate characteristics of the whole population.

Poisson Probabilities

The likelihood of a given number of events happening in a fixed interval of time or space, assuming the events occur with a known constant mean rate and independently of the time since the last event.

Poisson Distribution

A probability distribution that expresses the probability of a given number of events occurring in a fixed interval of time or space when these events occur with a known constant rate and independently of the time since the last event.