IIA IIA-CIA-PART4 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART4 Online Questions & Answers

• Question 461:

  A strategic group analysis does all but which of the following?

  A. Determines what mobility barriers exist.
  B. Forecasts future group actions and trends.
  C. Considers how the firm compares with the competitors within the chosen strategic group.
  D. Predicts reaction patterns to events such as competitive attacks.
  C. Considers how the firm compares with the competitors within the chosen strategic group.

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  An overall industry analysis, not a strategic group analysis, considers how the firm compares with the competitors within the chosen strategic group, e.g., on the basis of its scale of operations, the intensity of group rivalry, and the differences in the ability of the group members to implement their strategies.

• Question 462:

  Which of the following types of work teams are most likely to be cross-functional?

  A. Command group.
  B. Virtual.
  C. Research-and-development.
  D. Informal.
  C. Research-and-development.

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  A cross-functional team is one that includes members of different departments who have different areas of expertise. A research-and-development team is usually a cross-functional team because many different skills are needed to identify and create a new product.

• Question 463:

  According to Michael E. Porter's analysis of the evolution of global industries, the factor that is always necessary for an industry to become global is:

  A. The existence of environmental triggers to begin globalization.
  B. A strategic innovation.
  C. Marketing economies of scale.
  D. Changes in the costs of the factors of production.
  B. A strategic innovation.

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  The triggers of the evolution of global industries establish or exploit the sources of global competitive advantage. They also may negate the impediments to global competition. However, negating impediments will not result in globalization unless the firm has sufficient strategic advantages. Moreover, a strategic innovation is always necessary for an industry to become global. Environmental triggers include an increase in any of the types of economies of scale,lower transportation or storage costs, changes in distribution channels that facilitate access by foreign firms, changes in the costs of the factors of production, increased similarity of economic and social conditions in other nations, and reduction in governmental constraints. However, strategic innovations may begin globalization even if environmental triggers are not present. These innovations include, for example, product redefinition, reducing the costs of adapting a product for sale in different nations, design changes, and elimination of constraints.

• Question 464:

  Monopolistic competition is characterized by

  A. A relatively large group of sellers who produce differentiated products.
  B. A relatively small group of sellers who produce differentiated products.
  C. A monopolistic market where the consumer is persuaded that there is perfect competition.
  D. A relatively large group of sellers who produce a homogeneous product.
  A. A relatively large group of sellers who produce differentiated products.

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  Monopolistic competition is characterized by a large number of firms offering differentiated products. Entry into the market is relatively easy, firms have some price control, and substantial non price competition exists, such as advertising.

• Question 465:

  A team member who focuses on the overall perspective and reminds others of the vision, mission, or goal of the team informally assumes the role of a:

  A. Contributor.
  B. Collaborator.
  C. Communicator.
  D. Challenger.
  C. Communicator.

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  A communicator is a people-oriented member. S)he is process-driven and an effective listener. Thus, a communicator plays the role of a facilitator and a consensus builder.

• Question 466:

  During which stage of group development does a group exhibit a consolidation of power and reach an agreement among members about authority, structure, and procedures?

  A. Conflict and challenge stage.
  B. Disillusion stage.
  C. Acceptance stage.
  D. Cohesion stage.
  D. Cohesion stage.

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  The consolidation of power shifts begun during the conflict and challenge stages occurs during the cohesion stage. Members often reach an agreement on authority, structure, and procedures.

• Question 467:

  The director of internal auditing for a large company has established an excellent reputation because of her strong professional credentials and tactful but firm handling of auditor-auditee relationships. With regard to auditees, she must rely upon what sources of power?

  A. Expert and coercive.
  B. Referent and reward.
  C. Referent and expert.
  D. Legitimate and coercive.
  C. Referent and expert.

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  The internal audit director has no formal (legitimate or position) power over auditees. Nor does she have the power to coerce (punish) or reward them. Rather, her ability to exert power (influence others) must derive from her specialized ability and knowledge and the force of her personal qualities.

• Question 468:

  Which method of expanding into international markets is most likely the riskiest?

  A. A local storage and sale arrangement.
  B. Local component assembly.
  C. Direct investment.
  D. Joint venture.
  C. Direct investment.

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  Direct investment has many advantages:

  (1)

  cheaper materials or labor,

  (2)

  receipt of investment incentives from the host government, (3) a strong relationship with interested parties in the host country, (4) control of the investment,

  (5)

  a better image in the host country,

  (6)

  market access when domestic contest rules are in effect. However, direct investment is risky because of exposure to currency fluctuations, expropriation, potentially high exit barriers, and restraints on sending profits out of the country.

• Question 469:

  Which of the following actions taken by management would not be effective in motivating an employee to superior performance?

  A. Job enlargement.
  B. Job enrichment.
  C. Job security.
  D. Job rotation.
  C. Job security.

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  Frederick Herzberg's two-factor theory of human behavior postulated that there are two lasses of factors in the job situation. Dissatisfiers maintenance or hygiene factors) are foundin the job context. Their presence will not especially motivate people, but their absence will lead to diminished performance. They include company policy and administration, supervision, working conditions, interpersonal relations, salary, status, and job security.

• Question 470:

  What is the most likely generic strategic benefit of upstream vertical integration?

  A. It eliminates input cost distortion caused by the bargaining power of a strong customer.
  B. The supplier has returns exceeding the opportunity cost of capital.
  C. It eliminates the sales price distortion caused by the bargaining power of a strong supplier.
  D. The customer has returns lower than the firm's opportunity cost of capital.
  B. The supplier has returns exceeding the opportunity cost of capital.

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  Integration benefits include offsetting the bargaining power of strong suppliers and customers. If such parties have returns greater than the firm's opportunity cost of capital, the firm benefits even if no other advantages accrue from integration.