Exam 8: Perform the Analysis: Predictive Analytics

Cost drivers can be best identified by which of the following?

The probability of some event occurring based on some historical average is called __________.

__________ is the repeatability of the financial statement variables (e.g., earnings, sales, cash flows) over time.

Predicting the possible existence of fraud is a classification predictive analysis.

We would expect that sales forecasts would be more accurate than forecasts of operating income.

__________ will have very low risk because they are generally insured by the government. __________, however, will have a much higher risk and, thus, a much higher expected return.

According to the text, __________ does not prefer __________-basis accounting since it is inferior at forecasting future performance.

Predicting whether financial statements are fraudulent or not is an example of classification.

Classification analysis to decide on whether to grant a loan to a potential borrower is most important for __________.

We would expect a positive relationship (+) between loan acceptance and the debt-to-income ratio.

Which of the following is a predictive analytics technique used to estimate a specific dependent variable outcome based on independent variable inputs?

An assessment by the auditor if the company has the resources needed to operate for the foreseeable future is called __________.

Which is more persistent in predicting future amounts of the variable based on current amounts of that same variable?

Predictive and prescriptive analytics provide __________ deterministic output and __________ probabilistic models (judging the likelihood (probability) of a future event or outcome occurring) as compared to descriptive and diagnostic analytics.

A good first step in a bankruptcy prediction is to know how many companies go bankrupt each year (as a percentage of total firms) to understand how prevalent bankruptcy is as a whole.

Predicting whether a company will need to restate its financial statements is an example of __________.

Predicting whether it will rain tomorrow or next week is more deterministic than reporting the rain that happened yesterday.

__________ is the situation when the prediction places too little weight on the base rates of the past and instead uses different or new, recently received information.

__________ is the ability of a computer (or machine) to automatically learn on its own without being explicitly programmed to do so.

All of the following are factors used by Altman's Z in predicting bankruptcy except: