When Designing an Accounting Information System,the Cost to Acquire Additional

question 118

Multiple Choice

When designing an accounting information system,the cost to acquire additional information should be incurred ________.

• A) at all times so the operating manager has more information to make decisions
• B) when information overload does not occur
• C) at all times because the benefit cannot be quantified
• D) when the expected benefit of an improved decision exceeds the cost of the information

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Definitions:

Independent Trials

Experiments or trials in which the outcome of one trial does not affect the outcome of any other trials.

Binomial Experiment

A statistical experiment that has two possible outcomes for each trial and a fixed number of trials, where each trial is independent of the others.

Probability

A numerical expression of an event's probability, with the scale going from 0, symbolizing that the event cannot occur, to 1, signifying guaranteed occurrence.

Probability of Failure

The likelihood or chance that a system or component will fail to perform its required function within a specified period under normal operating conditions.