An auditing firm has developed a set of criteria for determining whether a particular account (and its balance) is in error. Historically, they know that of balances that were in error, 75 percent were regarded as unusual. Assume Company A shows a history of only 10 percent of the account balances being in error and it also shows that 25 percent of the account balances were unusual. What are the states of nature and the experimental outcomes?

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The Answer of An auditing firm has developed a set of criteria for determining whether a particular account (and its balance) is in error. Historically, they know that of balances that were in error, 75 percent were regarded as unusual. Assume Company A shows a history of only 10 percent of the account balances being in error and it also shows that 25 percent of the account balances were unusual. What are the states of nature and the experimental outcomes?

An Auditing Firm Has Developed a Set of Criteria for Determining