You are advising an accounting firm that wants to establish its first Web site. Approximately how much of the Web site budget should you assign to purchasing software?

You are advising an accounting firm that wants to establish its first Web site. Approximately how much of the Web site budget should you assign to purchasing software?



A) 10 percent

B) 25 percent

C) 50 percent

D) none, as no software will need to be purchased



Answer: A

You are planning the requirements for a site tracking and reporting system for your company Web site. Which of the following information requirements would not be essential for this function?

You are planning the requirements for a site tracking and reporting system for your company Web site. Which of the following information requirements would not be essential for this function?



A) number of unique visitors

B) pages visited

C) products purchased

D) secure credit card clearing



Answer: D

You are building an e-commerce Web site that will sell e-books and are looking for a hosted solution. Which of the following functionalities is least important for your business goals?

You are building an e-commerce Web site that will sell e-books and are looking for a hosted solution. Which of the following functionalities is least important for your business goals?



A) site tracking system

B) inventory management

C) digital catalog

D) customer database



Answer: B

Which of the following statements about m-commerce is not true?

Which of the following statements about m-commerce is not true?



A) In 2012, m-commerce represented less than 10 percent of all e-commerce.

B) M-commerce is the fastest growing form of e-commerce.

C) M-commerce annual revenues are approximately $30 billion.

D) In 2012, the top-grossing category of m-commerce was e-book sales.



Answer: D

EDI is

EDI is



A) the use of Internet technologies for electronic data transactions.

B) the exchange between two organizations of standard transactions through a network.

C) electronic data invoicing.

D) electronic delivery infrastructure.



Answer: B

Which of the following statements about B2B commerce is not true?

Which of the following statements about B2B commerce is not true?



A) Eighty percent of online B2B e-commerce is still based on EDI.

B) B2B e-commerce represents approximately three-quarters of the overall B2B marketplace.

C) B2B e-commerce only includes commercial transactions between firms.

D) B2B e-commerce revenues in 2012 were over $4 trillion.



Answer: B

Which of the following best illustrates the transaction fee revenue model?

Which of the following best illustrates the transaction fee revenue model?



A) eBay receives a small fee from a seller if a seller is successful in selling an item.

B) Epinions receives a fee after steering a customer to a participating Web site where he or she makes a purchase.

C) Flickr provides basic services for free, but charges a premium for advanced services.

D) Apple accepts micropayments for single music track downloads.



Answer: A

Which of the following best illustrates the affiliate revenue model?

Which of the following best illustrates the affiliate revenue model?



A) eBay receives a small fee from a seller if a seller is successful in selling an item.

B) Epinions receives a fee after steering a customer to a participating Web site where he or she makes a purchase.

C) Flickr provides basic services for free, but charges a premium for advanced services.

D) Apple accepts micropayments for single music track downloads.



Answer: B

Which of the following best illustrates the sales revenue model?

Which of the following best illustrates the sales revenue model?



A) eBay receives a small fee from a seller if a seller is successful in selling an item.

B) Epinions receives a fee after steering a customer to a participating Web site where he or she makes a purchase.

C) Flickr provides basic services for free, but charges a premium for advanced services.

D) Apple accepts micropayments for single music track downloads.



Answer: D

Which of the following best describes why small world theory is important to e-commerce?

Which of the following best describes why small world theory is important to e-commerce?



A) The products bought online by one individual will influence purchases by others.

B) The greater the number of people using your product, the more valuable it becomes.

C) You do not need to attract a large consumer base to become profitable.

D) Global products create a global community.



Answer: A

Market creators

Market creators



A) save users money and time by processing online sales transactions.

B) provide a digital environment where buyers and sellers can establish prices for products.

C) create revenue by providing digital content over the Web.

D) sell physical products directly to consumers or individual businesses.



Answer: B

Transaction brokers

Transaction brokers



A) generate revenue from advertising or from directing buyers to sellers.

B) save users money and time by processing online sales transactions.

C) provide a digital environment where buyers and sellers can establish prices for products.

D) sell physical products directly to consumers or individual businesses.



Answer: B

Information density refers to the

Information density refers to the



A) richness—complexity and content—of a message.

B) total amount and quantity of information delivered to consumers by merchants.

C) total amount and quantity of information available to all market participants.

D) amount of information available to reduce price transparency.



Answer: C

How are the Internet and e-commerce causing severe disruption to the existing advertising business model?

How are the Internet and e-commerce causing severe disruption to the existing advertising business model?



A) Ties between customer and businesses are being rethought.

B) Technology players such as Yahoo! seek to dominate online advertising and expand into offline ad brokerage.

C) New methods of advertising, such as blog advertising, are emerging.

D) The market entry costs for online advertising services are extremely low.



Answer: B

In controlling network traffic to minimize slow-downs, a technology called ________ is used to examine data files and sort low-priority data from high-priority data.

In controlling network traffic to minimize slow-downs, a technology called ________ is used to examine data files and sort low-priority data from high-priority data.



A) high availability computing

B) deep-packet inspection

C) application proxy filtering

D) stateful inspection



Answer: B

A digital certificate system

A digital certificate system



A) uses third-party CAs to validate a user's identity.

B) uses digital signatures to validate a user's identity.

C) uses tokens to validate a user's identity.

D) is used primarily by individuals for personal correspondence.



Answer: A

Most antivirus software is effective against

Most antivirus software is effective against



A) only those viruses active on the Internet and through e-mail.

B) any virus.

C) any virus except those in wireless communications applications.

D) only those viruses already known when the software is written.



Answer: D

A firewall allows the organization to

A firewall allows the organization to



A) prevent unauthorized communication both into and out of the network.

B) monitor network hot spots for signs of intruders.

C) prevent known spyware and malware from entering the system.

D) all of the above.



Answer: A

An authentication token is a(n)

An authentication token is a(n)



A) device the size of a credit card that contains access permission data.

B) type of smart card.

C) gadget that displays passcodes.

D) electronic marker attached to a digital authorization file.



Answer: C

Rigorous password systems

Rigorous password systems



A) are one of the most effective security tools.

B) may hinder employee productivity.

C) are costly to implement.

D) are often disregarded by employees.



Answer: B

______ controls ensure that valuable business data files on either disk or tape are not subject to unauthorized access, change, or destruction while they are in use or in storage.

______ controls ensure that valuable business data files on either disk or tape are not subject to unauthorized access, change, or destruction while they are in use or in storage.



A) Software

B) Administrative

C) Data security

D) Implementation



Answer: C

Application controls

Application controls



A) can be classified as input controls, processing controls, and output controls.

B) govern the design, security, and use of computer programs and the security of data files in general throughout the organization.

C) apply to all computerized applications and consist of a combination of hardware, software, and manual procedures that create an overall control environment.

D) include software controls, computer operations controls, and implementation controls.



Answer: A

The Sarbanes-Oxley Act

The Sarbanes-Oxley Act



A) requires financial institutions to ensure the security of customer data.

B) specifies best practices in information systems security and control.

C) imposes responsibility on companies and management to safeguard the accuracy of financial information.

D) outlines medical security and privacy rules.



Answer: C

The Gramm-Leach-Bliley Act

The Gramm-Leach-Bliley Act



A) requires financial institutions to ensure the security of customer data.

B) specifies best practices in information systems security and control.

C) imposes responsibility on companies and management to safeguard the accuracy of financial information.

D) outlines medical security and privacy rules.



Answer: A

The HIPAA Act

The HIPAA Act



A) requires financial institutions to ensure the security of customer data.

B) specifies best practices in information systems security and control.

C) imposes responsibility on companies and management to safeguard the accuracy of financial information.

D) outlines medical security and privacy rules.



Answer: D

Pharming involves

Pharming involves



A) redirecting users to a fraudulent Web site even when the user has typed in the correct address in the Web browser.

B) pretending to be a legitimate business's representative in order to garner information about a security system.

C) setting up fake Web sites to ask users for confidential information.

D) using e-mails for threats or harassment.



Answer: A

Evil twins are

Evil twins are



A) Trojan horses that appears to the user to be a legitimate commercial software application.

B) e-mail messages that mimic the e-mail messages of a legitimate business.

C) fraudulent Web sites that mimic a legitimate business's Web site.

D) bogus wireless network access points that look legitimate to users.



Answer: D

An example of phishing is

An example of phishing is



A) setting up bogus Wi-Fi hot spots.

B) setting up a fake medical Web site that asks users for confidential information.

C) pretending to be a utility company's employee in order to garner information from that company about their security system.

D) sending bulk e-mail that asks for financial aid under a false pretext.



Answer: B

Hackers create a botnet by

Hackers create a botnet by



A) infecting Web search bots with malware.

B) using Web search bots to infect other computers.

C) causing other people's computers to become "zombie" PCs following a master computer.

D) infecting corporate servers with "zombie" Trojan horses that allow undetected access through a back door.



Answer: C

In 2004, ICQ users were enticed by a sales message from a supposed anti-virus vendor. On the vendor's site, a small program called Mitglieder was downloaded to the user's machine. The program enabled outsiders to infiltrate the user's machine. What type of malware is this an example of?

In 2004, ICQ users were enticed by a sales message from a supposed anti-virus vendor. On the vendor's site, a small program called Mitglieder was downloaded to the user's machine. The program enabled outsiders to infiltrate the user's machine. What type of malware is this an example of?



A) Trojan horse

B) virus

C) worm

D) spyware



Answer: A

Which of the following statements about the Internet security is not true?

Which of the following statements about the Internet security is not true?



A) The use of P2P networks can expose a corporate computer to outsiders.

B) A corporate network without access to the Internet is more secure than one provides access.

C) VoIP is more secure than the switched voice network.

D) Instant messaging can provide hackers access to an otherwise secure network.



Answer: C

Electronic data are more susceptible to destruction, fraud, error, and misuse because information systems concentrate data in computer files that

Electronic data are more susceptible to destruction, fraud, error, and misuse because information systems concentrate data in computer files that



A) are usually bound up in legacy systems that are difficult to access and difficult to correct in case of error.

B) are not secure because the technology to secure them did not exist at the time the files were created.

C) have the potential to be accessed by large numbers of people and by groups outside of the organization.

D) are frequently available on the Internet.



Answer: C

______ refers to all of the methods, policies, and organizational procedures that ensure the safety of the organization's assets, the accuracy and reliability of its accounting records, and operational adherence to management standards.

______ refers to all of the methods, policies, and organizational procedures that ensure the safety of the organization's assets, the accuracy and reliability of its accounting records, and operational adherence to management standards.



A) "Legacy systems"

B) "SSID standards"

C) "Vulnerabilities"

D) "Controls"



Answer: D

A digital divide exists between ________.

A digital divide exists between ________.



A) U.S. software companies and European software companies

B) hardware companies and software companies

C) those who have Internet access and those who do not

D) employees of a software company and the managers of the company



Answer: c

An organization implements an information system to optimize its supply chain. The system helps the organization reduce wages and inventory charges. Hence, the system provides a competitive advantage to the organization. Here, the information system helped the organization achieve competitive advantage by ________.

An organization implements an information system to optimize its supply chain. The system helps the organization reduce wages and inventory charges. Hence, the system provides a competitive advantage to the organization. Here, the information system helped the organization achieve competitive advantage by ________.



A) locking in customers

B) reducing costs

C) locking in suppliers

D) differentiating the products



Answer: b

A group of manufacturing organizations purchases raw materials collectively to obtain better deals. This is an example of obtaining competitive advantage by ________.

A group of manufacturing organizations purchases raw materials collectively to obtain better deals. This is an example of obtaining competitive advantage by ________.



A) differentiating the industry

B) establishing standards

C) establishing alliances

D) enhancing the products



Answer: c

A large software manufacturer attempts to lock in customers by making it difficult for customers to change to another product. Identify the strategy used here.

A large software manufacturer attempts to lock in customers by making it difficult for customers to change to another product. Identify the strategy used here.



A) switching costs strategy

B) low cost operation strategy

C) differentiation strategy

D) consumerist strategy



Answer: a

July Networks provides digital television services across the country. They have a cutting-edge technology that provides high-resolution visuals. Customers are required to pay an up-front fee to cover the first two years of the subscription, when registering with July Networks. By doing this, which competitive strategy is July Networks implementing?

July Networks provides digital television services across the country. They have a cutting-edge technology that provides high-resolution visuals. Customers are required to pay an up-front fee to cover the first two years of the subscription, when registering with July Networks. By doing this, which competitive strategy is July Networks implementing?


A) differentiating the product

B) enhancing the product

C) locking in customers

D) standardizing the product



Answer: c

Synapz, a manufacturer of office automation products, recently received a patent for an advanced therapeutic ergonomics technology. By doing this, Synapz has ________.

Synapz, a manufacturer of office automation products, recently received a patent for an advanced therapeutic ergonomics technology. By doing this, Synapz has ________.



A) created entry barriers

B) introduced product differentiation

C) locked in its suppliers

D) reduced the cost of operations



Answer: a

PowerCruise, a holiday cruise firm, recently offered its existing customers an extension of six months to their membership without any additional charges. By doing this, which competitive strategy did PowerCruise implement?

PowerCruise, a holiday cruise firm, recently offered its existing customers an extension of six months to their membership without any additional charges. By doing this, which competitive strategy did PowerCruise implement?



A) creation of a new service

B) product differentiation

C) locking in of customers

D) locking in of suppliers



Answer: c

Huen Software, an application provider to the gaming industry, decided to increase its portfolio by developing 3-D graphics-supported games for the mobile gaming industry. By doingthis, which competitive strategy is Huen Software implementing?

Huen Software, an application provider to the gaming industry, decided to increase its portfolio by developing 3-D graphics-supported games for the mobile gaming industry. By doingthis, which competitive strategy is Huen Software implementing?



A) creation of entry barriers

B) product differentiation

C) reduction of cost

D) locking in of suppliers



Answer: b

RedDart is a premium freight provider in the United States. The company offers premium shipment services to its customers. The company ships faster than its competitors and uses tamperproof containers to ship its products. RedDart company distinguishes itself from competitors by ________.

RedDart is a premium freight provider in the United States. The company offers premium shipment services to its customers. The company ships faster than its competitors and uses tamperproof containers to ship its products. RedDart company distinguishes itself from competitors by ________.



A) providing an enhanced product

B) locking in its suppliers

C) locking in its customers

D) offering low-cost operations and services



Answer: a

RAC Associates is a car rental company. The company rents cars to customers in the United States. The company uses controls and procedures to prevent car theft. Such procedures are examples of ________.

RAC Associates is a car rental company. The company rents cars to customers in the United States. The company uses controls and procedures to prevent car theft. Such procedures are examples of ________.



A) primary business processes

B) core activities

C) strategic activities

D) supporting business processes



Answer: d

_____ argues that firms should create new, more efficient business processes that integrate the activities of all departments involved in a value chain.

_____ argues that firms should create new, more efficient business processes that integrate the activities of all departments involved in a value chain.



A) Internal supply chain design

B) Product differentiation model

C) Market differentiation model

D) Business process design



Answer: d

Which of the following statements is consistent with the central idea of business process design?

Which of the following statements is consistent with the central idea of business process design?



A) Technology should be used to supplement the existing value chain.

B) Business processes should not focus on the core competencies of organizations.

C) Organizations should create new business processes rather than improving existing systems.

D) Technology should be used to modify and improve standard business processes.



Answer: c

Lynn, the manager of a transportation company, is going through this week's delivery schedule. She calls her team and assigns territories for each executive. She contacts the fleet supervisor to arrange trucks for transportation. Which activity of the value chain is Lynn executing?

Lynn, the manager of a transportation company, is going through this week's delivery schedule. She calls her team and assigns territories for each executive. She contacts the fleet supervisor to arrange trucks for transportation. Which activity of the value chain is Lynn executing?



A) inbound logistics

B) marketing

C) customer service

D) outbound logistics



Answer: d

Mae manages delivery at a custom-kitchen outlet. Working with her customer's specifications, she contacts Gem Cabinets and places an order for a full-motion wall mount. Which of the following primary activities is Mae performing here?

Mae manages delivery at a custom-kitchen outlet. Working with her customer's specifications, she contacts Gem Cabinets and places an order for a full-motion wall mount. Which of the following primary activities is Mae performing here?



A) inbound logistics

B) operations

C) customer service

D) marketing



Answer: a

A retail marketing company sells such products as agricultural produce and consumer products. The company procures materials from farmers and local producers. This process of obtaining the inputs needed for a business is called ________.

A retail marketing company sells such products as agricultural produce and consumer products. The company procures materials from farmers and local producers. This process of obtaining the inputs needed for a business is called ________.



A) outbound logistics

B) inbound logistics

C) operations

D) internal marketing



Answer: b

Porter defined value as the ________.

Porter defined value as the ________.



A) amount of money that a customer is willing to pay for an offering

B) extent of after-sale service provided to customers

C) perceived satisfaction of the customers and sellers after a transaction

D) actual money exchanged in return of a product/service



Answer: a

An automobile company decides to improve the quality of all its products and bring more variety into its product line. The company has decided to adopt ________.

An automobile company decides to improve the quality of all its products and bring more variety into its product line. The company has decided to adopt ________.



A) focused cost-leadership

B) industry-wide differentiation

C) industry-wide cost leadership

D) focused differentiation



Answer: b

N-joi Ice Cream was facing competition to their flagship brand of "black currant ice cream". The competitor began offering three varieties of "black currant ice cream." N-joi decided to counter the threat by introducing five new varieties of ice creams. Which competitive strategy is N-joi implementing?

N-joi Ice Cream was facing competition to their flagship brand of "black currant ice cream". The competitor began offering three varieties of "black currant ice cream." N-joi decided to counter the threat by introducing five new varieties of ice creams. Which competitive strategy is N-joi implementing?



A) cost leadership

B) product differentiation

C) cost differentiation in the segment

D) service focus



Answer: b

ABC Motors is the largest manufacturer of cars. The company purchases raw materials from many small-sized sellers across the globe. In this case, ABC Motors ________.

ABC Motors is the largest manufacturer of cars. The company purchases raw materials from many small-sized sellers across the globe. In this case, ABC Motors ________.



A) faces very low threat of substitute products

B) has high bargaining power over its suppliers

C) faces very low threat of new entrants to market

D) has very high bargaining power over its customers



Answer: b

A new drug that has shown promise in curing lung cancer has been discovered by a famous chemical laboratory. This is the only drug effective for treatment of this disease. The laboratory obtains a patent for the product and decides to sell it. This situation is characterized by ________.

A new drug that has shown promise in curing lung cancer has been discovered by a famous chemical laboratory. This is the only drug effective for treatment of this disease. The laboratory obtains a patent for the product and decides to sell it. This situation is characterized by ________.



A) low threat of substitutions

B) high bargaining power of customers

C) high threat of new entrants

D) low bargaining power of suppliers



Answer: a