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

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 791:

  Intensity of rivalry among existing firms in an industry increases when:

  A. Products are relatively undifferentiated. II.Consumer switching costs are low.
  B. I only.
  C. II only.
  D. Both I and II.
  E. Neither I nor II.
  C. II only.

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  Explanation

  The degree of product differentiation and the costs of switching from one competitor's product to another increase the intensity of rivalry and competition in an industry. Less differentiation tends to heighten competition based on price, with price cutting leading to lower profits. Low costs of switching products also increase competition.

• Question 792:

  Under a value-added taxing system:

  A. Businesses must pay a tax only if they make a profit.
  B. The consumer ultimately bears the cost of the tax through higher prices.
  C. Consumer savings are discouraged.
  D. The amount of value added is the difference between an organization's sales and its cost of goods sold.
  B. The consumer ultimately bears the cost of the tax through higher prices.

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  Explanation

• Question 793:

  When is an organic organizational structure likely to be more successful than a mechanistic organizational structure?

  A. When a manufacturing organization has stable demand for its products.
  B. When an organization is subjected to strong political and social pressures
  C. When a manufacturer has reliable resources and suppliers
  D. When an organization is infrequently affected by technological advances
  D. When an organization is infrequently affected by technological advances

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  Explanation

• Question 794:

  Added-value negotiation is characterized by:

  A. One party approaching another with a proposal.
  B. A series of offers and counteroffers between the negotiating parties.
  C. Two parties making multiple deals.
  D. One party quickly conceding to the demands of the other.
  C. Two parties making multiple deals.

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  Explanation

  The basic principle of added-value negotiation is that the parties make multiple deals to add value to the process. The parties mutually clarify their common interests, identify options or the range of values each side can offer the other, and design alternative deal packages. Each package should be a win-win offer consisting of groups of the values identified in theprevious step.

• Question 795:

  X and Y are substitute products. If the price of product Y increases, the immediate impact on product Xis that its:

  A. Price will increase.
  B. Quantity demanded will increase.
  C. Quantity supplied will increase.
  D. Price, quantity demanded, and supplies will increase.
  B. Quantity demanded will increase.

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  Explanation

  By definition, if two goods are substitutes, the price of one and the demand for the other are directly related. For example, if the price of Y increases, the quantity demanded of X will increase.

• Question 796:

  According to Michael E Porter's generic strategies model, a firm that successfully adopts a differentiation strategy is most likely to:

  A. Tend to disregard cost control.
  B. Risk overlooking product changes.
  C. Closely supervise its labor force.
  D. Be able to pass supplier cost increases on to its customers.
  D. Be able to pass supplier cost increases on to its customers.

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  Explanation

  Differentiation is the generic strategy favored by firms that seek competitive advantage through providing a unique product or service and that have a broad competitive scope. A successful differentiation strategy creates a consumer perception that few, if any, substitutes are available. Thus, a firm that adopts this strategy may have the additional advantage of being able to pass supplier cost increases to consumers.

• Question 797:

  Which of the following techniques would be least effective in resolving the conflict created by an internal audit client's perception of the audit report as a personal attack on his management performance?

  A. The auditor should focus on the audit client as a person and understand him, rather than just concentrating on the problem.
  B. The auditor should make recommendations based on objective criteria, rather than based on a subjective assessment.
  C. The auditor should explore alternative solutions to address the audit problem, so the audit client has options.
  D. The auditor should take a flexible position on the recommendations and focus on resolving the issue by addressing the interests of the people concerned.
  A. The auditor should focus on the audit client as a person and understand him, rather than just concentrating on the problem.

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  Explanation

• Question 798:

  Which of the following types of analytics focuses less on analysis and more on condensing data into mote meaningful pieces of information?

  A. Diagnostic analytics
  B. Descriptive analytics
  C. Prescriptive analytics
  D. Predictive analytics
  C. Prescriptive analytics

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  Explanation

• Question 799:

  According to IIA guidance, which of the following are typical physical and environmental IT controls?

  A. Locating servers in locked rooms with restricted admission.
  B. Applying encryption where confidentiality is a stated requirement.
  C. Allocating and controlling access rights according to the organization's stated policy.
  D. Ensuring a tightly controlled process for applying all changes and patches to software, systems, network components, and data.
  A. Locating servers in locked rooms with restricted admission.

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  Explanation

  Comprehensive and Detailed In-Depth Explanation:

  Physical and environmental IT controls focus on securing IT infrastructure against unauthorized access and environmental hazards. Locating servers in locked rooms with restricted admission protects hardware from theft, tampering, and

  environmental risks.

  Option B (Applying encryption) - A logical security control, not a physical one.

  Option C (Access rights allocation) - A logical control related to identity management.

  Option D (Software patch control) - Part of IT governance and system maintenance, not physical security.

  Since physical access control is a critical component of IT security, Option A is correct.

  IIA IT Security - Physical and Environmental Controls

• Question 800:

  Technological uncertainty, subsidy, and spin-offs are usually characteristics of:

  A. Fragmentedindustries.
  B. Declining industries.
  C. Mature industries.
  D. Emerging industries.
  D. Emerging industries.

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  Explanation