The First Step in Developing an REA Diagram for a Specific

question 68

Multiple Choice

The first step in developing an REA diagram for a specific transaction cycle begins with identifying

• A)relevant events.
• B)agents involved.
• C)resources affected.
• D)relationship cardinalities.

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Definitions:

Worst Case Scenario

The most severe or unfavorable outcome that may happen in a given situation.

Expected Value

The average of all possible outcomes of a random variable, weighted by their respective probabilities.

Economic Assumptions

Hypotheses about the future economic condition that are used for planning and budgeting purposes.

Level of Expansion

Refers to the scale and scope of growth activities undertaken by a company to increase its business operations.