E3 Exam Dumps, E3 Practice Test Questions
PDF (New 2022) Actual CIMA E3 Exam Questions
NEW QUESTION 110
Which THREE of the following are valid reasons to follow a Corporate Social Responsibility strategy?
- A. A good Corporate Social Responsibility policy will increase the company's market value.
- B. A good Corporate Social Responsibility policy can help an Organization recruit employees to meet a diverse skills requirement.
- C. A good Corporate Social Responsibility policy can attract customers.
- D. A good Corporate Social Responsibility policy is likely to reduce administration costs.
- E. A good Corporate Social Responsibility policy is likely to attract a higher calibre of staff.
Answer: B,C,E
NEW QUESTION 111
A Service Level Agreement (SLA) defines exactly what services a service provider will provide and the required level or standard for those services.
Which of the following statements regarding Service Level Agreements is NOT correct?
- A. Service Level Agreements should include the expected response time to technical queries.
- B. Service Level Agreements should include a guarantee to provide 100% availability for complaint resolution.
- C. Service Level Agreements should include the procedures for cancelling the contract.
- D. Service Level Agreements should include the targets and benchmarks to be used and the consequences for failing to meet them.
Answer: A
NEW QUESTION 112
JKL is a bank with a large number of personal customers.
A member of staff has reported their loss of a portable electronic storage device to his line manager.
The portable electronic storage device contains customer account details, including secure information such as personal login details to access personal accounts. JKL has a clear policy that forbids staff from downloading customer data on to portable electronic storage devices.
It would be difficult for a member of the public to access the information on the device.
Which of the following would you advise JKL to do?
- A. Notify all customers of the loss and advise them to monitor their accounts for unusual transactions.
- B. Let the staff member explain why they downloaded data before deciding on their dismissal.
- C. Wait for customers to query unusual transactions and refund any money they have lost.
- D. Retain the staff member and monitor them secretly to establish whether they are engaged in a fraud.
Answer: A
NEW QUESTION 113
TTT is a conglomerate with two divisions, AAA and BBB. Advise TTT on the most appropriate strategy to adopt for each division.
Answer:
Explanation:
NEW QUESTION 114
A company runs a distribution warehouse. Its information systems constantly monitors inventory levels, with automatic re-order processing occuring with suppliers when inventory items reach a specified level. It operates a robotics system which automatically picks inventory from its location in the warehouse and delivers it to the pick-up area. The company also has a large database of customer information which it uses to analyse buying behaviour and sales trends so that it can provide customers with relevant and targeted marketing information.
Which THREE of the following activities of the Value Chain have been affected by the use of IT/ IS?
- A. Sales and Marketing
- B. Inbound Logistics
- C. Outbound logistics
- D. Operations
- E. Services
Answer: A,B,D
NEW QUESTION 115
Mission statements set out the purpose of an Organization to a range of stakeholders who have an interest in what the Organization does. As an employee, you have been asked to assess the effectiveness of your Organization's mission statement.
Which of the following would NOT help the effectiveness of a mission statement?
- A. Mission statements should communicate the Organization's distinctive advantages.
- B. Mission statements should be aspirational and capture the imagination of stakeholders.
- C. Mission statements should be specific enough to impact Organizational behaviour.
- D. Mission statements should be flexible, realistic and attainable.
Answer: B
NEW QUESTION 116
Which THREE of the following statements are correct in relation to the use of the Performance Pyramid?
- A. It highlights the links running between the company's corporate vision and its functional objectives.
- B. The productivity aspect refers to the management of output at the business operating systems level of the Organization.
- C. The pyramid includes a specific cost aspect which considers the cost figures in the management accounts.
- D. It derives from the idea that an Organization operates at different levels.
- E. One of the aspects of the pyramid is Stakeholders.
Answer: A,B,D
NEW QUESTION 117
Communication is a critical element of the Organizational change process. Communicating the change vision is a component of Kotter's eight steps to transforming Organizations.
Which of the following statements support Kotter's component 'Communicate the change vision'?
Select ALL that apply.
- A. One-way communication is more powerful than two-way communication.
- B. Storytelling and symbolic actions are unnecessary.
- C. Ensure the change message and vision are memorable and repeatable.
- D. Face-to-face communications improve clarity of message.
- E. Unaddressed inconsistencies undermine the credibility of strategic communications.
Answer: C,D,E
NEW QUESTION 118
Organizations require resources to undertake a strategy and these can include physical, human, financial and intangible resources. However, alone they will not ensure Organizational success. For that, resources must be combined together to create competences.
The competences which form the basis of competitive advantage are things that an Organization is able to do and are very difficult for competitors to copy.
Which of the following describes this?
- A. Core competences
- B. Threshold competences
- C. Basic competences
- D. Strategic competences
Answer: A
NEW QUESTION 119
Mendelow developed a matrix in which he characterised stakeholders by reference to their degree of power and level of interest.
Place the correct category against each of the classes of stakeholders.
Answer:
Explanation:
NEW QUESTION 120
PQR is a software design company. The Board of PQR has always openly encouraged partnerships with a wide range of designers and other Organizations in its industry, to continually develop and enhance the services it offers and to utilise the expertise and knowledge of a range of individuals and Organizations. PQR's staff have also been highly creative and innovative in the design services they provide. PQR regularly analyses and keeps up to date with changes in the environment in which it operates. PQR operates a sophisticated website to promote its services and keep in touch with its service users.
Which TWO of the following attributes of a change adept Organization, as defined by Kanter, has PQR demonstrated?
- A. Continual service development
- B. Sophisticated systems
- C. Imagination to innovate
- D. Environmental awareness
- E. Openness to collaborate
Answer: C,E
NEW QUESTION 121
Which of the following structures would you recommend for the Board of Directors of a UK public company in order to fulfill its legal responsibilities?
- A. There should be no restriction placed on the minimum or maximum number of Directors. The Directors' roles should be shared but the Chairman or Chairwoman should not act also as the Chief Executive.
- B. The Board of Directors should have a minimum of six directors with the Board's tasks divided amongst them. The Board should also have a Chairman or Chairwoman who may serve as the Chief Executive if time permits.
- C. The Board should have no more than six members with clearly defined executive and non-executive responsibilities. To make the role more efficient Chairman or Chairwoman of the Board should also be the Chief Executive.
- D. The Chairman or Chairwoman should not have an executive role within the company. There should be at least two directors to carry out the Board's roles.
Answer: D
NEW QUESTION 122
Corporate political activity can be seen as a proactive attempt by a company to influence government decision-making. In particular, lobbying represents a direct but often private attempt by businesses to influence a government's decision-making.
Which of the following is NOT a legitimate and private form of lobbying?
- A. Monitoring
- B. Advocacy
- C. Application of pressure
- D. Undisclosed party financing
Answer: D
NEW QUESTION 123
Which of the following did Johnson, Scholes and Whittington identify as success criteria for the evaluation of strategic options?
Select ALL that apply.
- A. Feasibility
- B. Durability
- C. Suitability
- D. Affordability
- E. Acceptability
Answer: A,C,E
NEW QUESTION 124
Which of the following would be a suitable performance measure of Internal Business Processes within Kaplan and Norton's 'Balanced Scorecard model?
- A. Increase in market share
- B. Higher P/E ratio
- C. New products developed
- D. Reduction in manufacturing cycle times
Answer: C
NEW QUESTION 125
A leading supermarket chain is undertaking environmental scanning as it is concerned that it is becoming uncompetitive and profits have started to fall. The Board is concerned that when the next Annual General Meeting is held, it will need to have a viable strategy to present to its shareholders, in order to prevent shareholders' protests.
In the past the company has been reluctant to offer an Internet shopping service. However, it now believes that by offering this service and also introducing customer relationship marketing (CRM) this will produce a strategy that will help it to improve its competitiveness.
Which of the following statements apply to CRM?
Select ALL that apply.
- A. In mature markets, existing customers provide the most likely source of future earnings.
- B. The company must be prepared to take customers' needs into account and be able to meet these needs.
- C. CRM is about marketing to customers to obtain their loyalty, so customer research is not needed.
- D. The CRM process needs to include increasing the range of products that will be offered to customers.
- E. CRM utilises marketing resources to retain, rather than simply attract new customers.
Answer: A,B,E
NEW QUESTION 126
AAA manufactures and sells a range of travel suitcases. One model, the 'Executive' has seen sales growth of around 3% for the last two years, following strong growth since its introduction eight years ago. This slow down in the 'Executive' sales growth is largely due to AAA's competitors offering products in direct competition with the 'Executive'. AAA has therefore had to reduce its price to match those of its major competitors. AAA has also recently upgraded the features of the 'Executive' model to include a variety of different colours and materials. It has also launched a marketing campaign to promote the benefits of the 'Executive' model against its competitors products.
Which stage of the product life cycle has the 'Executive' model of suitcases reached?
- A. Decline
- B. Introduction
- C. Growth
- D. Maturity
Answer: D
NEW QUESTION 127
BBB operates a small chain of coffee shops within Country X. a mature economy in northern Europe. BBB was established 20 years ago and currently employs over 150 staff in 25 shops located in major towns and cities throughout Country X. BBB attracts a wide range of customers, who are attracted by its extensive menu of coffee products and food Customers can either consume their purchases within the shop or can take their purchases away.
Which THREE of the following external environmental changes would have the greatest impact on BBB in the next three years?
- A. An increase in the average age of the population in Country X due to falling birth rates.
- B. A planned refurbishment of 80% of BBB's shops to update its image and increase shop floor space
- C. An increase in the national statutory minimum wage in Country X.
- D. A worldwide shortage of coffee beans due to climate changes, affecting availability.
- E. The opening of an internationally renowned chain of coffee shops in Country X.
Answer: A,C,D
NEW QUESTION 128
ABC is an online bank which has just reported substantial trading losses. It has received advice from a leading business consultancy that it should implement the following two strategies:
1. Take advantage of its reputation and brand image by entering a new industry.
2. Update all its networks to fifth generation (5G) as soon as possible. Which TWO of the following strategies has ABC been advised to implement?
- A. Consumer strategy
- B. Functional or operational strategy
- C. Ethical strategy
- D. Foundational strategy
- E. Sustainable strategy
- F. Corporate strategy
Answer: B,F
NEW QUESTION 129
Select the MOST appropriate leadership style to manage each change situation outlined below.
Answer:
Explanation:
NEW QUESTION 130
Company TTT produces a range of products, including products T1 and T5
Product T1. Profitability has declined in recent years, although small profits continue to be made as the market contracts due to changing customer preferences Overall market share is low and continues to reduce However, in addition to external sales T1 is also used as a component of product T5.
Product T5 A market leader within a low growth market, sources components both externally and from I I Is other subsidiaries T5 benefits from significant economies of scale and TTT has recently considered modernising its T5 production line but following a cost benefit analysis, decided not to proceed Which of the following is an appropriate strategy for TTT to adopt?
- A. Divest product T1 and Harvest product T5
- B. Harvest product T1 and Divest product T5.
- C. Harvest both product T1 and product T5.
- D. Divest both product T1 and product T5.
Answer: A
NEW QUESTION 131
PPP wishes to increase shareholder value using the Seven Value Drivers identified in Shareholder Value Analysis (SVA). Place the correct direction of change next to each driver.
Answer:
Explanation:
NEW QUESTION 132
You are responsible for managing a small team of people tasked with implementing a new environmental management reporting system across all Group subsidiaries. Senior management teams within subsidiary businesses are increasingly resisting the introduction of the system. Place your recommended approach for dealing with each of the following comments.
Answer:
Explanation:
NEW QUESTION 133
TUV had an employee turnover rate of 25% among new recruits and was becoming short of skilled workers.
The Board of TUV realized there was something dramatically wrong and called in consultants to assess the problem. The consultants recommended transformational change in that TUV should redesign the entire production system, change the placement of all equipment and the flow of work, redefine every job and give all workers new assignments.
Which type of change did the consultants recommend for TUV?
- A. Reconstruction
- B. Revolution
- C. Adaptation
- D. Evolution
Answer: B
NEW QUESTION 134
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