All of the Following Statements Are True Regarding Ratios and Forecasts

question 44

Multiple Choice

All of the following statements are true regarding ratios and forecasts except:

• A) Ratios cannot confirm whether forecast assumptions will turn out to be correct.
• B) Ratios can tell whether future sales growth was accurately captured.
• C) Ratios cannot tell whether assumptions about future cash flows are realistic.
• D) Ratios can tell whether growth rates for sales are consistent with past sales growth performance.

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Definitions:

Non-normal Populations

Populations that do not follow a normal distribution, which affects the choice of statistical methods used.

Independently

Without being influenced by others or by external factors; in statistics, refers to events that have no effect on the likelihood of other events occurring.

Sampling Distribution

The calculated probability distribution relevant to a specific statistic, achieved by random sampling.

Sample Mean Difference

The difference between the average values of two samples drawn from a population.