ACCT 318 ch 8

What is the purpose of predictive analytics?

• To focus on current events only

• To ignore historical data

• To predict future events

• To look at past events only

Which of the following is a type of predictive analytics?

• Descriptive analysis

• Time series analysis

• Historical analysis

• Current analysis

What does classification in predictive analytics do?

• It combines all data into one group

• It separates data into groups

• It deletes data

• It ignores data

What is Altman's Z used for?

• To predict stock prices

• To predict sales

• To predict weather

• To predict bankruptcy

What does a Z score of less than 1.80 indicate?

• Safe zone

• Gray zone

• Happy zone

• Distress zone

What is a negative effect on loan extension classification?

• Employment length

• Amount of the requested loan

• Good credit history

• High income

What is Beneish's M-score used to detect?

• Customer preferences

• Weather changes

• Market trends

• Financial statement fraud

What might an increase in receivables indicate?

• No change in policies

• Easier credit policies

• Stricter credit policies

• Decrease in sales

What does regression analysis help estimate?

• Future weather

• Random guesses

• Dependent variable outcomes

• Historical events

What is a base rate?

• A random guess

• Probability based on historical average

• A new prediction

• An unrelated event