CAIB 4 EXAM QUESTIONS AND ANSWERS 2025/2026

CAIB 4 EXAM QUESTIONS AND ANSWERS 2025/2026 What are the two approaches to planning? Explain each - 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? - 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? - 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. Why is Top-Down planning not suitable for a small organization. - answer-Stifles innovation, slows decisions, managers need to know too much, What are the four characteristics of a plan? - answer-1) Simplicity 2) Practicability 3) Severability 4) Flexibility Explain Simplicity (2 points) - 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 - answer-The plan must be realistic