The auditors audit choices as trust lowest audit nash

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Unformatted text preview: % 40% Percent of all choices Percent of all choices 40% 35% 30% 25% 20% 15% 35% 30% 25% 20% 15% 10% 10% Cheat Cheat 5% 5% Nash 0% Nash 0% Trust Cooperate Trust Nash Cooperate Nash Defensive Defensive Panel C: No-Puffery/Strong Group Panel D: Yes-Puffery/Strong Group 45% 40% 40% Percent of all choices 50% 45% Percent of all choices 50% 35% 30% 25% 20% 15% 10% Cheat 5% Nash 0% 35% 30% 25% 20% 15% 10% Cheat 5% Nash 0% Trust Cooperate Nash Defensive Trust Cooperate Nash Defensive The managers’ fraud choices include cooperate (lowest level of fraud), Nash (middle level of fraud), and cheat (highest level of fraud) levels. The auditors’ audit choices as trust (lowest audit), Nash (middle audit), and defensive (highest audit) levels. the increased frequency of the trust/cheat combination in the YP/WG setting (shown in Panel B), relative to the NP/WG setting (shown in Panel A). Panel C of Table 4 compares average payoff differences using ANOVA. These results, together with data from Table 3 s...
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