What Is the Most Appropriate Control to Prevent Improper Use

question 7

Multiple Choice

What is the most appropriate control to prevent improper use of share or bond instruments?

• A)Authorization to purchase shares by a senior financial officer.
• B)Use of a registered broker to purchase and sell all shares.
• C)Proper custodial control of securities.
• D)Registration of bond instruments with the exchange authorities.

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Definitions:

Output Units

The quantity of goods or services produced, measured in units, which can refer to individual items, batches, or specific measures of output.

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain at a constant.

Average Total Costs

The cost of producing each unit, calculated by dividing the overall production expense by the number of units produced.