Deck 6: Billing and Payment Systems

Question 1

PayPal is a type of:

A) online payment system.
B) mobile payment system.
C) radio frequency identification.
D) eBay competitor.
E) none of the above.

Answer 1

online payment system.

Question 2

M-payment stands for:

A) money payment
B) multiple payment
C) mobile payment
D) micro payment
E) mini-payment

Answer 2

mobile payment

Question 3

An important characteristic of cash is ________.

A) anonymity
B) acceptance
C) portability
D) Instant transfer of value
E) all of the above

Answer 3

all of the above

Question 4

Payment systems such as the Mondex electronic cash system need to overcome the following before being considered successful:

A) security issues
B) infrastructure issues
C) consumer acceptance
D) business acceptance
E) all of the above

Question 5

When a user does online banking, the use of Secure Socket Layer:

A) ensures all data is deleted from internet service providers.
B) creates a session encryption that cannot be easily broken.
C) requires the use of a virtual private network.
D) can override encryption and ensure security.
E) creates a virtual private network to the bank.

Question 6

Email payment systems provide some security by using ________.

A) private questions
B) passwords
C) Interac
D) direct account transfer
E) none of the above

Question 7

In the business-to-business area:

A) payment is not really an issue as in B2C.
B) payment issues are just as serious as B2C.
C) security is much higher and payment is less of an issue.
D) security is much lower but payment is low risk.
E) most purchases can be paid later by cheque.

Question 8

Value-added networks have been used primarily to:

A) carry out the same function as email applications.
B) manage corporate security.
C) replace EDI networks.
D) carry EDI data securely.
E) link communities to the internet.

Question 9

The following devices were predicted to be used for m-payments:

A) watches, DVD players, and MP3s
B) notebooks, credit cards, and digicash
C) wireless smart cards, and mobile phones
D) e-wallets, debit cards, and digital cheques
E) email, e-wallets, and digital cheques

Question 10

The following is a true statement about payment systems and security:

A) Payment and security issues are primarily unrelated.
B) Payment and security issues are closely related.
C) Payments cannot occur without security.
D) Payment is always secure if made by credit card.
E) Security cannot protect credit cards.

Question 11

In attempting to develop a new global payment mechanism, the following is very important:

A) scalability
B) bank acceptance
C) electronic bill presentment
D) dedicated value-added network
E) electronic document interchange

Question 12

The Secure Electronic Transaction (SET) protocol aims to improve credit card security by:

A) Monitoring transactions on the internet.
B) monitoring merchants' collection of data.
C) using encryption and authentication technology.
D) adding additional passwords to credit card transactions.
E) requiring merchants to enter a password prior to approval of transactions.

Question 13

The following is true of digital cheques for online transactions:

A) It is easy to establish new forms of digital cheques.
B) Digital cheques are an excellent online payment form.
C) The acceptance of digital cheques is an issue for consumer support.
D) Security of digital cheques is not really a concern.
E) Banks have strong security digital cheques available to consumers.

Question 14

The Secure Electronic Transaction (SET) protocol uses the following to enable the cardholders and merchants to verify online parties' information:

A) public/private key technology, encryption, and digital certificates
B) digital readers, online encoders, general key technology
C) radio wave technology, scanners and bar coding
D) electronic signatures, X-rays, finger printing technology
E) all of the above

Question 15

Wireless technologies and payment mechanisms:

A) reduce the need for security and encryption.
B) easily build on internet security.
C) are being developed and show considerable promise.
D) will make traditional payment mechanisms quickly obsolete.
E) none of the above

Question 16

Electronic data interchange (EDI) has been used for many years. The internet has:

A) wiped out the use of EDI.
B) increased the use of EDI.
C) provided alternatives to EDI.
D) reduced the security risks of EDI.
E) none of the above

Question 17

The internet has primarily:

A) removed the usefulness of EDI.
B) added numerous options for networking.
C) created multiple secure payment mechanisms.
D) reduced the usefulness of credit cards.
E) caused banks to disconnect their networks.

Question 18

_____ fraud occurs when thieves use hidden cameras to record victims' personal identification numbers (PINs) at automated teller machines (ATMs) and obtain copies of their debit cards.

A) Skimming
B) Data mining
C) Security
D) Phishing
E) Sniffing

Question 19

_____ is a security tool that protects credit cards.

A) Encryption
B) Authentication
C) Non-repudiation
D) A password
E) none of the above

Question 20

The greatest factor contributing to the success of PayPal is its ________.

A) portability
B) acceptance
C) relationship to eBay
D) anonymity
E) low cost

Question 21

The PayPass program is very promising because:

A) customers are issued a plastic key fob.
B) transmitter chips are cheap and mass-produced.
C) it is backed by MasterCard.
D) it was tested first in Canada.
E) it eliminates the need for credit cards.

Question 22

Payment processing on the internet reduces the costs associated with:

A) online marketing.
B) mailing paper invoices.
C) website maintenance.
D) currency exchange.
E) clearing digital cheques.

Question 23

Mobile phones have little or no use for making ecommerce payments.

Question 24

A good electronic payment system should have the same characteristics as traditional money.

Question 25

One of the big problems with cheque imaging is:

A) the legal system has not recognized it.
B) the signatures on the images are unclear.
C) they only apply to long-term, regular customers.
D) they don't contain the same information as paper cheques.
E) they require special scanners.

Question 26

A relatively new addition to the online offering of banks is:

A) online instant credit.
B) wireless smart cards.
C) epost
D) ECash
E) email money transfer.

Question 27

Conducting a transaction over the internet costs roughly ________ percent of the cost of conducting that same transaction through a bank branch.

A) 25
B) 15
C) 10
D) 5
E) 2

Question 28

ECash was built on public key cryptography involving the use of a private key to sign messages and a public key to verify the signatures.

Question 29

Persons using EDI must be signatories to an EDI agreement and must have their information systems configured to be able to recognize and process the transactions.

Question 30

EChecks contain the same information as paper cheques.

Question 31

Electronic data interchange has no place in the payment area of ecommerce.

Question 32

Mobile phones are still not a viable payment alternative for general usage because:

A) the use of 900 numbers in a payment system is controversial.
B) consumers receive numerous ebills from multiple sites.
C) mobile operators do not have the necessary billing information for customers.
D) there are still no standards.
E) consumers need additional devices.

Question 33

Radio Frequency Identification (RFID) technology uses electronic waves to transfer data between a reader and device and an item such as a smart card or mobile phone.

Question 34

The most widespread m-payment systems are wireless smart cards based on:

A) RFID technology.
B) personal bank accounts.
C) PayPal.
D) credit cards.
E) ECash.

Question 35

Banking systems are attempting to consolidate bill presentment with their payment mechanisms.

Question 36

Cyberthieves target PayPal account holders through ________.

A) phishing
B) sniffing
C) skimming
D) data mining
E) cookies

Question 37

SET Protocol is a short term for systems electrifying transmission.

Question 38

Registering credit card information in a personal profile that is kept in a secure area by a vendor means that:

A) the customer needs to only log in once to that vendor.
B) risk of detection increases.
C) they are legally protected from fraud.
D) credit card information is only transmitted once per vendor.
E) personal information is encrypted with that vendor.

Question 39

A value-added network indicates that another company reviews an organization's network periodically and suggests improvements.

Question 40

PayPal originally offered payments only in:

A) Canadian dollars.
B) US dollars.
C) Euro.
D) online credits.
E) ECash

Question 41

Why is a credit card considered not to provide an instant transfer of value?

Question 42

Credit card transactions costs are inexpensive.

Question 43

Why is PayPal considered to be an email payment system?

Question 44

The most successful and innovative alternative online payment system developed so far is PayPal.

Question 45

How does a Mondex card differ from eCash?

Question 46

What does RFID stand for?

Question 47

Credit cards have been the main payment method used for online purchases, however the shortcomings of credit cards in the real world have become even more evident in cyberspace. Explain.

Question 48

What was the major reason for EDI to move from traditionally using value-added networks to using the web as a platform?

Question 49

Provide an example of a credit card scam.

Question 50

Explain how smart cards work.