Which Would NOT Typically Be an Objective of a Financial

question 23

Multiple Choice

Which would NOT typically be an objective of a financial statement audit?

• A) Ensuring the existence of assets and liabilities and occurrence of income and expenses
• B) Evaluating the economy and efficiency with which scarce resources are used
• C) Verifying that all financial statement items are properly presented
• D) Ensuring that the auditee owns the assets and is obligated to the extent of liabilities shown
• E) Verifying the proper valuation of assets,liabilities,income,and expenses

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Definitions:

Correlation Coefficient

The correlation coefficient is a statistical measure that calculates the strength of the relationship between the relative movements of two variables.

Portfolio Opportunity Set

The expected return–standard deviation pairs of all portfolios that can be constructed from a given set of assets.

Efficient Frontier

A portfolio optimization concept that plots the best possible return for a given level of risk based on various asset combinations.

Optimal Risky Portfolio

The optimal risky portfolio is the combination of risky assets that provides the highest expected return for a given level of risk or the lowest risk for a given level of expected return.