For which of the following populations would probability-proportional-to-size sampling be most likely to be the most efficient technique in confirming accounts receivable?
A)2,000 accounts with a standard deviation of $650, with few misstatements expected.
B)2,000 accounts with a standard deviation of $25, with few misstatements expected.
C)6,000 accounts with a standard deviation of $650, with many misstatements expected.
D)6,000 accounts with a standard deviation of $25 with many misstatements expected.

Question

Quizplus · Accepted Answer

Probability-proportional-to-size sampling is most efficient when there is a large variation in account sizes (high standard deviation) and few misstatements are expected, as it focuses on larger accounts where misstatements are more likely to be material.

For Which of the Following Populations Would Probability-Proportional-To-Size Sampling Be