IIA IIA-CIA-PART3 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 1:

  Which of the following strategies is most appropriate for an industry that is in decline?

  A. Invest in marketing.
  B. Invest in research and development.
  C. Control costs.
  D. Shift toward mass production.
  C. Control costs.

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  Explanation

• Question 2:

  A firm that wishes to obtain the benefits of vertical integration may acquire a minority common stock interest in a supplier or customer firm. This arrangement is most appropriately described as:

  A. Partial integration.
  B. Tapered integration
  C. Quasi-integration.
  D. Contract integration
  C. Quasi-integration.

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  Explanation

  Quasi-integration is something more than a long-term contract and less than full ownership. It may be achieved by a minority common stock interest, debt guarantees, cooperation in RandD, an exclusive dealing arrangement, etc. Buyer and seller may, as a result, have aspecial community of interest leading to lower costs, smoothing of supply/demand fluctuations, or mitigating against bargaining power. Quasi-integration may avoid commitment to an adjacent business, with its investment and management requirements. But many benefits of full integration may not be achievable in this wav.

• Question 3:

  A firm expands into international markets to

  A. Be in foreign markets.
  B. Eliminate foreign competition
  C. Pursue new, higher-profit opportunities.
  D. Preclude piracy of the firm's products.
  C. Pursue new, higher-profit opportunities.

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  Explanation

  A firm may decide to go abroad for many reasons, for example, to respond to a competitive challenge in its home country by another global firm, to pursue opportunities yielding greater profits, to achieve economies of scale, to diversify, or to follow customers who need international service.

• Question 4:

  In a SWOT analysis, a firm considers macroeconomic factors when it identifies:

  A. The capability profile.
  B. Opportunities and threats.
  C. Core competencies.
  D. Strengths and weaknesses.
  B. Opportunities and threats.

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  Explanation

  Opportunities and threats (the external environment) are identified by consideringmacro environmentalfactors (economic, demographic, political, legal, social, cultural, and technical) andmicro environmentalfactors (suppliers, customers, distributors, competitors, and other competitive factors in the industry).

• Question 5:

  An internal auditor is reviewing results from software development integration testing.

  What is the purpose of integration testing?

  A. To verify that the application meets staled user requirements.
  B. To verify that standalone programs match code specifications.
  C. To verify that me application would work appropriately for the intended number of users.
  D. To verify that all software and hardware components work together as intended
  D. To verify that all software and hardware components work together as intended

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  Explanation

• Question 6:

  Which strategy for a global marketing organization is based on a portfolio of national markets?

  A. reaction of a division to manage international marketing.
  B. A multinational strategy.
  C. A global strategy.
  D. Creation of an export department
  B. A multinational strategy.

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  Explanation

  International marketing efforts take three basic forms:creation of an export department, creation of a division to manage international marketing, or global organization. The latter encompasses genuinely worldwide functions, e.g., manufacturing, marketing, finance, and logistics. Thus, worldwide operations are the organization's focus, not merely that of a department or division of a national firm. A global organization may follow a multinational, global, or glocal strategy. A multinational strategy adopts a portfolio approach. Its emphasis is on national markets because the need for global integration is not strong. The product is customized for each market and therefore incurs higher production costs. Decision making is primarily local with a minimum of central control. This strategy is most effective given large differences between countries. Also, exchange rate risk is reduced when conducting business in this manner.

• Question 7:

  When determining the appropriate span of control, the most important consideration is:

  A. The set of policies and procedures currently in effect.
  B. The typical span of control used by other entities.
  C. The preference of the company's creditors.
  D. That all departments will be evaluated, whether or not they will be affected.
  A. The set of policies and procedures currently in effect.

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  Explanation

  The most important factors to consider are the employees' and manager's preferences and skills, the firm's culture, the tasks involved, physical location of the department, and established policies and procedures.

• Question 8:

  A one-time password would most likely be generated in which of the following situations?

  A. When an employee accesses an online digital certificate
  B. When an employee's biometrics have been accepted.
  C. When an employee creates a unique digital signature.
  D. When an employee uses a key fob to produce a token.
  D. When an employee uses a key fob to produce a token.

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  Explanation

• Question 9:

  Which of the following statements about market signaling is correct?

  1. The organization releases information about a new product generation.

  2. The organization limits a challenger's access to the best source of raw materials or labor.

  3. The organization announces that it is fighting a new process technology.

  4. The organization makes exclusive arrangements with the channels.

  A. 1 and 3 only
  B. 1 and 4 only
  C. 2 and 3 only
  D. 2 and 4 only
  A. 1 and 3 only

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  Explanation

• Question 10:

  A manager found that instructions given to a subordinate were not followed. A review of the cause of the failure revealed that the manager was interrupted by several telephone calls while issuing the instructions. In terms of problems in the communications chain, the interruptions are:

  A. Noise.
  B. Nonverbal feedback.
  C. Semantics.
  D. Closure.
  A. Noise.

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  Explanation

  Noise in the communication channel refers to any disruption that impedes the encoding, sending, or receipt of a message, such as being interrupted by several telephone calls while issuing instructions.