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CAIB 4 2025 BRAND NEW ACTUAL EXAM WITH 100%
VERIFIED QUESTIONS AND CORRECT SOLUTIONS| ACE
YOUR GRADES.
What are the two approaches to planning? Explain each - correct
answer -1) Top Down Planning - Management provides the
mission, strategies, and objectives for the brokerage
2) Bottom Up Planning - Management provides the mission and
broad strategies. Leaves the objectives, goals and activities to
business units.
What are the advantages and disadvantages of top down
planning? - correct answer -Advantages: Management feels in
control and in charge of decision making.
Disadvantages: hard to get buy-in from employees
What are the advantages and disadvantages of bottom up
planning? - correct answer -Advantages: business units have
ownership and buy in.
Disadvantages: Management feels less in control, there may be
resistance to changes made to the plan by management.
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Why is Top Down planning not suitable for a small organization. -
correct answer -Stifles innovation, slows decisions, managers
need to know too much,
What are the four characteristics of a plan? - correct answer -1)
Simplicity
2) Practicability
3) Severability
4) Flexibility
Explain Simplicity (2 points) - correct answer -The plan should be
explainable in simple terms.
The plan should be implemented without extensive training while
employees continue their day to day operations.
Explain Practicability - correct answer -The plan must be realistic
Explain severability (2 points) - correct answer -The parts of a
plan must be separate and identifiable.
Each business unit must see how to apply it to their area
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Explain flexibility - correct answer -A good plan must allow for
modification as it is implemented.
Explain the difference between a strategic plan and an action plan
- correct answer -Strategic plans are broad and cover 3-5 years.
Action plans give specific activities to support SP. They apply to a
particular unit and cover 1-3 years, typically one year.
How many components of a strategic plan are there? - correct
answer -Seven.
What are the first three components of a strategic plan? - correct
answer -a) Scanning the external environment.
b) Scanning the Internal Environment
c) Matching strengths and weaknesses to opportunities and
threats.
Explain "scanning the external environment" and its two sub
categories. - correct answer -Scanning the external environment
looks at the competitive environment and attempts to identify
opportunities and threats.
CAIB 4 2025 BRAND NEW ACTUAL EXAM WITH 100%
VERIFIED QUESTIONS AND CORRECT SOLUTIONS| ACE
YOUR GRADES.
What are the two approaches to planning? Explain each - correct
answer -1) Top Down Planning - Management provides the
mission, strategies, and objectives for the brokerage
2) Bottom Up Planning - Management provides the mission and
broad strategies. Leaves the objectives, goals and activities to
business units.
What are the advantages and disadvantages of top down
planning? - correct answer -Advantages: Management feels in
control and in charge of decision making.
Disadvantages: hard to get buy-in from employees
What are the advantages and disadvantages of bottom up
planning? - correct answer -Advantages: business units have
ownership and buy in.
Disadvantages: Management feels less in control, there may be
resistance to changes made to the plan by management.
, Page | 2
Why is Top Down planning not suitable for a small organization. -
correct answer -Stifles innovation, slows decisions, managers
need to know too much,
What are the four characteristics of a plan? - correct answer -1)
Simplicity
2) Practicability
3) Severability
4) Flexibility
Explain Simplicity (2 points) - correct answer -The plan should be
explainable in simple terms.
The plan should be implemented without extensive training while
employees continue their day to day operations.
Explain Practicability - correct answer -The plan must be realistic
Explain severability (2 points) - correct answer -The parts of a
plan must be separate and identifiable.
Each business unit must see how to apply it to their area
, Page | 3
Explain flexibility - correct answer -A good plan must allow for
modification as it is implemented.
Explain the difference between a strategic plan and an action plan
- correct answer -Strategic plans are broad and cover 3-5 years.
Action plans give specific activities to support SP. They apply to a
particular unit and cover 1-3 years, typically one year.
How many components of a strategic plan are there? - correct
answer -Seven.
What are the first three components of a strategic plan? - correct
answer -a) Scanning the external environment.
b) Scanning the Internal Environment
c) Matching strengths and weaknesses to opportunities and
threats.
Explain "scanning the external environment" and its two sub
categories. - correct answer -Scanning the external environment
looks at the competitive environment and attempts to identify
opportunities and threats.
