Explain the near Privity Approach to Third-Party Negligence Suits Against

question 43

Essay

Explain the near privity approach to third-party negligence suits against accountants.

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Definitions:

Bystander Effect

a phenomenon where individuals are less likely to offer help to a victim when other people are present, often due to a diffusion of responsibility.

Social Exchange Theory

A theory that describes how the relationship between individuals is formed by weighing the benefits and costs of interacting with each other.

Outgroup Homogeneity

The perception that members of an outgroup are more similar to each other than they really are, typically compared to the perceived diversity within one's own group.

Hindsight Bias

The tendency to believe, after an event has occurred, that one would have predicted or expected the outcome, often leading to an oversimplification of cause and effect.