In Which of the Following Situations Would a CPA Be

question 113

Multiple Choice

In which of the following situations would a CPA be considered independent?

• A)A CPA has obtained an auto loan from a banking client.
• B)A CPA has obtained a 90-day signature loan from a client.
• C)A CPA has obtained a loan for investment purposes from a client.
• D)A CPA has obtained an interest-free loan from a banking client.

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Definitions:

Scatter Diagram

A graphical representation that displays the relationship between two quantitative variables using Cartesian coordinates to display values for typically a set of data.

Least Squares Line

A straight line that best fits the data points of a scatter plot, minimizing the sum of the squares of the vertical distances of the points from the line.

Covariance

Covariance is a measure that indicates the extent to which two random variables change in tandem. A positive covariance means that the variables tend to move in the same direction, while a negative covariance means they move inversely.

Least Squares Line

A straight line that minimizes the sum of the squares of the differences between observed and theoretical values.