An Event's Revised Probability Depends On

question 28

Multiple Choice

An event's revised probability depends on:

• A) purely subjective assessments.
• B) prior probabilities and the accuracy of new information.
• C) the sum of the prior probability and the conditional probability.
• D) the expected value of information.
• E) a consensus among experts' opinions.

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Definitions:

Realized

Pertains to gains or losses that have been incurred as a result of actual transactions as opposed to those that are theoretical or projected.

Earned

Income or revenue that has been generated or received for goods sold or services provided.

Retained Earnings

The portion of net income that is not distributed to shareholders but is instead reinvested in the business or kept as a reserve for certain purposes.

Completed Contract Method

A financial accounting approach where revenue and expenses of a contract are recorded only when the contract is fully completed.