the supply of municipal services in terms of such factors as wage costs, population density, personal income, and city area. In general, these attempts compare a service in several municipalities and rely on statistical analysis to uncover significant relationships between provision of the service and various factors under investigation. In most studies that develop statistical models, however, little attention is directed towards the particular operating characteristics of the service being examined. Moreover, in different cities, a given service may be rendered in different ways, making the development of comparable service measures, and consequently inter-city comparison, difficult. This paper reviews the provision of municipal fire suppression service. It attempts to avoid the difficulties inherent in inter-city comparisons by examining the service provided to different sectors of one city and relating the differing levels of service to the differing levels of fire incidence, population density and fire hazard in those sectors. In the first part of this paper a general cost/ benefit-framework is presented for the supply of fire suppression service to one sector. Then it is shown how the single sector formulation can be transformed into a multi-sector distribution framework that is more amenable to empirical verification. Finally, the results are applied to a study of fire suppression service distribution in New York City. The emphasis in this study is on the description of an existing allocation.

The phenomenal growth in corporate merger activity of the 1960s revived interest in the motives and effects relating to corporate mergers. In recent years, many theories for explaining mergers have been discussed and tested in the literature of finance, law, and economics. Various authors have argued that motives for merger include increased market power [15, 21, 23], achievement of operating or managerial scale economies [2, 8], diversification [6], tax reduction [19], growth maximization [14, 16], and bankruptcy avoidance [7, 10, 12, 13]. The bankruptcy avoidance motive is perhaps the most recently articulated of all merger motives, and perhaps the only one for which no systematic attempts at empirical validation have been forthcoming.

The purpose of this study is to build and test a statistical model for the dynamic estimation of portfolio Betas. Of particular interest is the quality of Beta estimates obtainable from relatively small samples of daily return data. Also of particular interest is an assessment of the relationship between the quality of these estimates and the degree of portfolio diversification. For obvious reasons it is desirable for a mutual fund manager to have the best possible estimates of the ongoing (and possibly changing) Betas of competitive funds. These estimates together with estimates of the degree of diversification will allow a portfolio manager to develop investment strategies relative to the expected performance of his own portfolio and his competitors in the market cycle ahead. These estimates will also allow inferences to be made with respect to the current market outlook of each individual competitor. For example, a gradually increasing fund Beta would indicate a bullish outlook on the part of a particular competitor.

The purpose of this paper is to provide evidence on the following question: Are there more banking offices available per person to furnish consumer and business services in branch banking states than in unit banking states? This question is a central part of a broader issue of what limitations should be placed on the ability of individual banks to branch. Indeed, in a recent review of the literature dealing with the branching question, and prepared for the Senate Banking Committee (McIntyre Committee), Guttentag [8] stated: “One of the most pervasive arguments for branch banking is that branch banks provide more office facilities than unit banking.” Yet the available evidence on the question is sparse and existing research contains methodological difficulties which make the findings of questionable value.

A definition of market adjustment is proposed in terms of the time it takes market attributes to reflect new information. Properties of the proposed definition are discussed. In order to operationalize the concept, a statistical method is introduced to estimate the adjustment times. Empirical examples are used to illustrate the proposed method. Some possible economic interpretations are given. The properties of the estimator are also investigated by simulation and analytical methods.

Auditing, Substantive test, Sampling, Accounting population

Abstract Reviews the book "The CPA Examination: Text, Problems and Solutions," by A.N. Mosich and E. John Larsen.