"The Theory's Predictions Are Consistent with What I Believe,so Now

question 23

Multiple Choice

"The theory's predictions are consistent with what I believe,so now I have good reason to believe what the theory says." This statement is likely to have been made by a person who believes that

• A) theories should be tested by gathering and analyzing data.
• B) theories are descriptive of reality.
• C) theories should be falsifiable or refutable.
• D) b and c
• E) none of the above

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Definitions:

FVTOCI

An acronym for Fair Value Through Other Comprehensive Income, a classification under IFRS accounting standards for financial assets held for purposes other than trading, where changes in fair value are recognized in other comprehensive income rather than profit or loss.

Equity Method

An accounting technique used to assess the profits earned by investments in other companies, reflecting the profit in proportion to shares held.

Comprehensive Income

The total change in equity for a reporting period other than transactions from owners, encompassing all realized and unrealized gains and losses.

Cost Method

An accounting method used for investments, where the investment is recorded at cost and adjustments are made only for dividends received and permanent declines in value.