IMANET IMANET Certifications IMANET-CMA Questions & Answers

• Question 701:

  Scenario development

  A. Is a quantitative forecasting method.

  B. Is a method of determining an organization's direction?

  C. Is used to identify courses of action.

  D. Requires preparation of future event scenarios.

  Correct Answer: D

  Scenario development is a qualitative forecasting method that requires preparation of conceptual scenarios of future events given carefully defined assumptions. It entails writing multiple different but equally likely descriptions of future states.

• Question 702:

  Determining what is ues must be addressed and considering the objectives of the desired course of action are accomplished during which step of the decision-making process?

  A. Defining the problem.

  B. Obtaining information.

  C. Evaluating solutions.

  D. Implementing the decision.

  Correct Answer: B

  During the step in the decision-making process of obtaining information, the decision maker determines which issues must be addressed, for example, whether to make or outsource a component. The decision maker also considers the objectives of the desired course of action, for example, to increase return on investment or to enter a new market.

• Question 703:

  The limiting factor principle

  A. Applies to identifying alternative courses of action.

  B. Defines the problem.

  C. Justifies an alternative.

  D. Predicts future costs.

  Correct Answer: A

  The limiting factor principle is used in the decision-making process during the step involving identifying alternative courses of action. The crucial factor is the one that limits or prevents achievement of the desired goal. The mass of alternative choices can be reduced if managers can identify the limiting factors to a problem.

• Question 704:

  Information processing for decision making is characterized by two styles: anaI3, tic and intuitive. Which of the following is a characteristic of the intuitive style?

  A. Unstructured.

  B. Objective.

  C. Detailed.

  D. Deductive.

  Correct Answer: A

  The intuitive style of information processing for decision making is subjective, inductive, non routine, and unstructured. Intuitive people may rely on hunches and reach decisions without explicitly applying a formal process. The thinking or analytic style of decision making is objective, deductive, precise, detailed, logical, and repetitive. It tends to prevail in the traditional organization.

• Question 705:

  A decision model is a formal means of choosing future courses of action. The programmed decision process and the non programmer decision process are used for making decisions. What is the difference between the two?

  A. The programmed decision process is used for complex situations.

  B. The programmed decision process is not based upon decision rules.

  C. The non programmer decision process requires answers to four questions.

  D. No difference exists between the two.

  Correct Answer: C

  Management accountants provide qualitative information as well as quantitative financial and 1nonfinancial information useful in applying a decision model, The programmed decision process is used for routine or repetitive decisions. The non programmer decision process is used for complex. no routine situations calling for the use of the problem- solving process. Pour questions need to be answered before making a non programmer decision.

• Question 706:

  A company is designing a new regional distribution warehouse. To minimize delays in loading and unloading trucks, an adequate number of loading docks must be built. The most relevant technique to assist in determining the proper number of docks is

  A. Linear programming.

  B. Decision trees.

  C. The Monte Carlo method.

  D. Queuing theory.

  Correct Answer: D

  Queuing theory is a group of mathematical models for systems involving waiting lines. In general, a queuing system consists of a waiting line and a service facilely (loading docks in this case). The objective of queuing theory is to minimize the total cost of the system, including both service and waiting costs, for a given rate of arrivals.

• Question 707:

  When making predictions about costs, what makes a cost relevant to a decision?

  A. Cost has already been paid.

  B. Cost must vary between alternatives.

  C. Cost must be paid in the future.

  D. Cost must both vary between alternatives and be paid in the future.

  Correct Answer: D

  To be relevant to a decision, a cost must vary between alternatives and be paid or incurred in the future.

• Question 708:

  The modeling technique to be employed in a situation involving a sequence of events with several possible outcomes associated with each event is

  A. Cost-benefit analysis.

  B. Decision tree analysis.

  C. The Monte Carlo method.

  D. Linear programming.

  Correct Answer: B

  Decision trees may be used to describe complex decision situations. Each branch of the tree represents a different decision, and each twig extending from each branch represents several possible outcomes of the decision.

• Question 709:

  Which of the following is not an attribute of a probability distribution?

  A. The total probability associated with all possible occurrences equals 1.

  B. It can be modeled by means that provide the probability for every possible outcome.

  C. Only one outcome is possible.

  D. It concerns a random variable.

  Correct Answer: C

  In a probability distribution, the probability of any event(s) is bounded by U (no chance) and I (certainty). The total probability of all possible outcomes must add up to 1. Also, a probability distribution models a random variable through the use of a formula or graph that provides the probability associated with the occurrence of certain values of the random variable. If only one outcome is possible, the variable is not random but rather constant and known with certainty.

• Question 710:

  Decisions are frequently classified as those made under certainly and those made under uncertainly. Certainly exists when

  A. The probability of the event is less than 1.

  B. There is absolutely no doubt that an event will occur.

  C. There is more than one outcome for each possible action.

  D. There is risk involved.

  Correct Answer: B

  An event is certain if there is no doubt that it will occur. The probability is I if an event is certain to occur and 0 if it is certain not to occur. Under conditions of certainly, consequences are therefore deterministic, not 1probabilistic or unknown.