As an Internal Control, RSR Corporation Requires Two Signatures on All

question 54

Multiple Choice

As an internal control, RSR Corporation requires two signatures on all checks over $500, thus illustrating the importance of:

• A)Human judgment.
• B)Information technology.
• C)Both human judgment and information technology.
• D)Neither human judgment nor information technology.

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Definitions:

Behavioral Economists

Scholars who study the effects of psychological, cognitive, emotional, cultural, and social factors on economic decisions of individuals and institutions.

Marginal Disutility

The additional dissatisfaction or negative utility gained by consuming or producing one additional unit of a good or service.

Status Quo

The existing state of affairs; in prospect theory, the current situation from which gains and losses are calculated.

Prospect Theory

A behavioral economic theory that describes how people choose between probabilistic alternatives that involve risk, where the probabilities of outcomes are uncertain.