Deck 5: Operating Your E-Business

Question 1

E-business startup operational challenges include resolving legal, taxation, hiring, and technology issues.

Answer 1

True

Question 2

Because professional legal advice is so expensive, an e-business entrepreneur should avoid contacting an attorney as long as possible as he or she starts up the business.

Answer 2

False

Question 3

Your network of family members and friends can give you the most accurate advice on issues such as copyrights, trademarks, employee benefits, and personnel policies.

Answer 3

False

Question 4

A copyright is a form of legal protection for original work, such as writing, drama, music, and art.

Question 5

A copyright is a distinctive symbol, word, or phrase that a business uses to identify its products.

Question 6

An e-business Web site should have an easy-to-find and clearly worded statement detailing how the e-business collects and uses customer information.

Question 7

An entrepreneur should consider relocating from a home office to commercial office space when his or her e-business requires appropriate meeting spaces for clients and business associates.

Question 8

Before leasing commercial office space, an entrepreneur should prepare a detailed facilities plan.

Question 9

Locating and leasing commercial office space without the help of a commercial real estate broker is a good way for an entrepreneur to save time and money.

Question 10

A burn rate is the rate with which an entrepreneur burns through job applications before hiring a new employee.

Question 11

To add credibility to an e-business startup, an entrepreneur's first hire may need to be an experienced chief information officer or other senior management personnel.

Question 12

Offering competitive compensation and benefits packages is generally all a startup e-business needs to do to attract and hire key employees.

Question 13

A charge card allows a consumer to pay for his or her purchases using a revolving line of credit.

Question 14

A consumer is liable for a maximum of $50 for an unauthorized withdrawal using his or her debit card.

Question 15

In order to accept payment cards, an e-business must first set up a merchant account at a financial institution.

Question 16

An e-business may be required to pay higher fees for a merchant account because the financial institution's risk of payment card fraud is greater for an online transaction than for an offline transaction.

Question 17

The discount rate is a percentage of each transaction charged by a financial institution for an e-business's merchant account.

Question 18

It is vital for an e-business that accepts payment cards to provide adequate security for the card information during each transaction.

Question 19

SSL transmissions use digital certificates for authentication.

Question 20

An electronic wallet is a small, plastic card that stores information or cash.

Question 21

Fraudulent credit card charges are not a major problem for e-businesses that accept payment cards.

Question 22

Payments for online purchases in the range of a few cents to $5 are called micropayments.

Question 23

Back-end systems are the aspects of a business with which the business's customers interface and over which the customers can exert some control.

Question 24

Middleware is software used to connect new e-business systems to existing legacy systems.

Question 25

Hosted storefront software is generally a good choice for a small online store because the software is easily customizable.

Question 26

Shopping cart software manages customer purchases by temporarily storing the purchase information and then handling the complete checkout process.

Question 27

A content management system (CMS) is used to integrate all aspects of a business's operations.

Question 28

The major advantage to a startup e-business, of outsourcing some or all of its operations is reduced costs.

Question 29

A fulfillment house is an independent company that provides order fulfillment services for other businesses.

Question 30

A service mark must be registered with the United States:

A) Patent and Trademark Office
B) Copyright Office
C) Patent and Service Mark Office
D) Registration Office

Question 31

Which of the following is a non-profit organization that advocates disclosure of information privacy policies?

A) BitPass
B) TRUSTe
C) eCash
D) Cybersource

Question 32

A plan that identifies office space, meeting space, electrical, and telecommunication needs is called a(n):

A) business plan
B) financial plan
C) operating plan
D) facilities plan

Question 33

A payment card that requires a consumer to pay the balance in full each month is a:

A) debit card
B) credit card
C) charge card
D) stored value card

Question 34

A payment card that enables a consumer to pay for items with a debit directly from his or her checking account is called a:

A) credit card
B) debit card
C) charge card
D) stored value card

Question 35

A payment card that allows a consumer to pay for items using a revolving line of credit is a:

A) credit card
B) debit card
C) charge card
D) stored value card

Question 36

An account at a financial institution into which payment card receipts are deposited is a:

A) payment gateway
B) storefront software
C) merchant account provider
D) merchant account

Question 37

A secure online service that submits payment card transactions to the merchant bank's card processing center is a:

A) merchant account
B) payment gateway
C) software service
D) None of the above

Question 38

A business that aggregates a merchant account, payment gateway, payment processing software, and equipment is a:

A) merchant account provider
B) payment processing provider
C) payment gateway provider
D) merchant account specialist

Question 39

The risk associated with a consumer's refusal to pay a charge on his or her credit card is called a:

A) discount rate
B) cardholder not present risk
C) chargeback
D) refusal risk

Question 40

The secure standard protocol for transmitting financial transactions electronically is the:

A) Secure Transaction Layer (STL)
B) Secure Sockets Layer (SSL)
C) Secure Payments Layer (SPL)
D) Secure Items Layer (SIL)

Question 41

The process of verifying the identity of the parties involved in an electronic transaction is called:

A) certification
B) identification
C) authentication
D) None of the above

Question 42

The number one fraud-related complaint received by the Federal Trade Commission (FTC) is:

A) price gouging
B) misleading advertising
C) identity theft
D) poor customer support after the sale

Question 43

Temporary credit card numbers that are not reusable are called:

A) e-business credit card numbers
B) virtual credit card numbers
C) practical credit card numbers
D) B,C

Question 44

The payment method that allows consumers to pay for products or services online by transmitting a unique electronic number or other identifier that represents a specific dollar value is called:

A) electronic cash
B) transmitted cash
C) stored value cash
D) quick cash

Question 45

Online payments in denominations from a few cents to about $5 are called:

A) minipayments
B) micropayments
C) tiny payments
D) little payments

Question 46

P2P payment systems are used extensively for online:

A) B2B exchange purchases
B) B2C purchases
C) C2C auction purchases
D) B2G government purchases

Question 47

An online payment method that allows anyone anywhere around the world to send or receive money via e-mail is called a(n):

A) B2B payment system
B) B2C payment system
C) P2P payment system
D) A2B payment system

Question 48

The business systems with which customers interface and over which they have some control are called:

A) front-end systems
B) ERP systems
C) content management systems
D) back-end systems

Question 49

Existing business systems that must be integrated with new e-business systems are called:

A) real-time systems
B) security systems
C) back-end systems
D) legacy systems

Question 50

Software designed to manage customer online purchases and payments is:

A) CRM software
B) hosted storefront software
C) shopping cart software
D) ERP software

Question 51

Software that manages and controls dynamic Web content from authorship to publication is part of:

A) ERP
B) CMS
C) CRM
D) SSL

Question 52

Databases used by a content management system to store Web page templates and other components are called:

A) Web depositories
B) site depositories
C) page depositories
D) content repositories

Question 53

A business system that integrates all aspects of a business including planning, manufacturing, human resources, accounting, and finance is a(n):

A) ERP system
B) content management system (CMS)
C) CRM system
D) Web hosting system

Question 54

The major disadvantage to a startup e-business of outsourcing some or all of its business operations is:

A) increased costs
B) lack of control
C) increased customer satisfaction
D) improved technological support

Question 55

Companies that distribute software services over the Internet are called:

A) Web hosting companies
B) Internet service providers
C) application service providers (ASPs)
D) fulfillment houses

Question 56

An independent company that provides warehousing, order picking, and order distribution services is a(n):

A) third-party logistics provider
B) warehousing provider
C) order processing provider
D) distributor

Question 57

After planning and funding a startup e-business, the next step for an entrepreneur is to begin_______________the new e-business.

Question 58

Just like a brick-and-mortar business, an e-business is subject to local, state, and federal_______________.

Question 59

Virtually everything on a Web site is protected by_______________law, whether or not a statement to that effect is posted at the site.

Question 60

Using a(n)_______________or_______________to heighten consumer awareness of a product or service is called branding.

Question 61

One way an e-business can build customer confidence about information privacy is to become a(n)_______________licensee.

Question 62

_______________are the largest single source of revenue for many local and state governments.

Question 63

A(n)_______________plan should include a budget for office space, utilities, security, insurance, parking, and other estimated costs for new office space.

Question 64

The key to success for any business is its_______________.

Question 65

Global professional_______________can be a good source of potential employees when trying to fill senior management positions.

Question 66

A good source of regional information on the salary and benefit expectations of potential employees is_______________.

Question 67

U.S. consumers typically prefer to pay for online purchases using a_______________card.

Question 68

The federal_______________Act limits liability for unauthorized credit and charge card charges to $50.

Question 69

In establishing its fees for a given business merchant account, the financial institution or merchant account provider assesses the_______________level of the business.

Question 70

To provide secure transaction processing, an e-business must use some type of _______________ and digital_______________to protect data while it is being transmitted through the payment process.

Question 71

A(n)_______________is a trusted third-party that issues digital certificates.

Question 72

A(n)_______________is a small card approximately the size of a credit card that contains an electronic memory chip.

Question 73

Accounting, budgeting, marketing, human resources, and inventory management are all part of an e-business's_______________systems.

Question 74

_______________gathered by front-end systems is used by back-end systems to facilitate internal businesses processes.

Question 75

_______________software builds and maintains Web pages and underlying databases for an e-retail site.

Question 76

A(n)_______________manages and controls the authoring, reviewing, editing, scheduling, and publishing processes for a Web site.

Question 77

In a CMS, the databases or content_______________contain templates, text, images, and other content that can be used to create Web pages "on the fly."

Question 78

A(n)_______________system organizes and manages interactions with customers including sales, payments, and customer support.

Question 79

_______________applications compile customer information into databases and use the information to match customer needs with products and services.

Question 80

Hosting.com, Rackspace Managed Hosting, and Affinity are all examples of _______________companies.