Cisco
CompTIA
ISC
EC-Council
EXIN
Fortinet
ITIL
Juniper
Microsoft
VMware
Avaya
SAP
Google
NVIDIA
Salesforce
Amazon
Palo Alto Networks
ISC2
Splunk
ServiceNow
All Vendors
  2. Home
  3. Exams
  4. IIA
  5. CIA

IIA CIA Exam
Certified Internal Auditor Exam (Page 33 )

Updated On: 12-Jan-2026
Page 33 of 342
PDF with 1702 Questions

If Projects A and B. are independent, which of the following statements is true?

  1. The company should undertake Project A only.
  2. The company should undertake Project only.
  3. The company should undertake both projects.
  4. The company should not undertake either project.

Answer(s): C

Explanation:

Independent projects are those whose cash flows are not affected by the acceptance or nonacceptance of other projects. The company must decide whether to accept or to reject each of the projects. Because both projects have a positive NPV calculated using the firm's 8% cost of capital, both should be accepted. A firm with an 1 8 f cost of capital is considering the following projects on January 1. Year 1):



While auditing a marketing department, the internal auditor discovered that the product life cycle model was used to structure the marketing mix. Under such a philosophy, the opportunity for cost reductions would be greatest in which stage of the life cycle?

  1. Introduction stage.
  2. Growth stage.
  3. Maturity stage.
  4. Decline stage.

Answer(s): B

Explanation:

During the growth stage, the opportunity for cost reductions is at its maximum because production volume is increasing at a high rate. Thus, fixed costs are being spread over more units of production. and the benefits of the learning curve are being realized.



While auditing a marketing department, the internal auditor discovered that the product life cycle model was used to structure the marketing mix Under such a philosophy, the price charged on a consistent basis for a specific product would probably be lowest during which life cycle stage?

  1. Introduction stage.
  2. Growth stage.
  3. Maturity stage.
  4. Decline stage.

Answer(s): C

Explanation:

During the maturity} stage, competition is at its greatest and costs are at their lowest. Moreover, entities are engaged in competitive price-cutting measures, resulting in some of the lowest prices seen during a product's life cycle_



At the introduction stage of an innovative product, the profit growth is normally slow due to

  1. Expensive sales promotion.
  2. High competition.
  3. A mass market
  4. Available alternatives.

Answer(s): A

Explanation:

The introduction stage is characterized by slow sales growth and lack of profits because of the high expenses of promotion and selective distribution to generate awareness of the product and encourage customers to try it Thus, the per-customer cost is high. Competitors are few, basic versions of the product are produced, and higher-income customers innovators) are usually targeted. Cost-plus prices are charged. They may initially be high to permit cost recovery when unit sales are low. The strategy is to infiltrate the market, plan for financing to cope with losses, build supplier relations, increase production and marketing efforts, and plan for competition.



In a product's life cycle, the first symptom of the decline stage is a decline in the

  1. Entity's inventory levels.
  2. Product's sales.
  3. Product's production cost
  4. Product's prices.

Answer(s): B

Explanation:

The sales of most product types and brands eventually decrease permanently. This decline may be slow or rapid. This first symptom of the decline stage of a product's life cycle triggers such other effects as price cutting, narrowing of the product line, and reduction in promotion budgets.



Viewing page 33 of 342
Viewing questions 161 - 165 out of 1702 questions



Post your Comments and Discuss IIA CIA exam prep with other Community members:

Join the CIA Discussion