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Sample Questions
Question 1
Which of the following statements accurately describes one of the characteristics that
distinguishes a multinational company from a domestic company?
A. A multinational company has stockholders in other countries.
B. A multinational company exports its products to other countries.
C. A multinational company operates outside of its country of origin.
D. A multinational company uses raw materials and components from more than one
country.
ANSWER : C
Question 2
Which of the following purchasing scenarios would gain the greatest benefit from
implementing electronic data interchange?
A. A time-sensitive just-in-time purchase environment.
B. A large volume of custom purchases.
C. A variable volume sensitive to material cost.
D. A currently inefficient purchasing process.
ANSWER : A
Question 3
Which of the following is an example of a nonfinancial internal failure quality cost?
A. Decreasing gross profit margins over time.
B. Foregone contribution margin on lost sales.
C. Defective units shipped to customers.
D. Excessive time to convert raw materials into finished goods.
ANSWER : D
Question 4
In which type of business environment are price cutting strategies and franchising
strategies most appropriate?
A. Embryonic, focused.
B. Fragmented, decline.
C. Mature, fragmented.
D. Competitive, embryonic.
ANSWER : C
Question 5
Multinational organizations generally spend more time and effort to identify and evaluate:
A. Internal strengths and weaknesses.
B. Break-even points.
C. External trends and events.
D. Internal risk factors.
ANSWER : C
EXAM CODE : IIA-CIA-Part3
