In which type of business environment are price cutting strategies and franchising strategies most appropriate?

• A.Mature, fragmented.
• B.Fragmented, decline.
• C.Embryonic, focused.
• D.Competitive, embryonic.

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Which of the following is a product-oriented definition of a business rather than a market-oriented definition of a business?

• A.We make movies.
• B.We supply energy.
• C.We provide climate control in the home.
• D.We are a people-and-goods mover.

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Which mindset promotes the most comprehensive risk management strategy?

• A.Maximize market share.
• B.Increase shareholder value.
• C.Mitigate losses.
• D.Improve operational efficiency.

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When assessing the adequacy of a risk mitigation strategy, an internal auditor should consider which of the following?
1) Management's tolerance for specific risks.
2) The cost versus benefit of implementing a control.
3) Whether a control can mitigate multiple risks.
4) The ability to test the effectiveness of the control.

• A.1, 3, and 4
• B.2, 3, and 4
• C.1, 2, and 4
• D.1, 2, and 3

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A chief audit executive (CAE) was asked to participate in the selection of an external auditor. Which of the following would not be a typical responsibility for the CAE?

• A.Develop appropriate performance metrics.
• B.Monitor the work of the external auditors.
• C.Evaluate the proposed external auditor fee.
• D.Recommend criteria to be used in the selection process.

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