Deck 9: E-Commerce: Digital Markets,digital Goods

Question 1

In general,for digital goods,the marginal cost of producing another unit is about zero.

Answer 1

True

Question 2

Disintermediation provides major benefits to the distributor.

Answer 2

False

Question 3

Exchanges have become one of the most popular types of Net marketplace because they encourage competitive bidding that drives prices down.

Answer 3

False

Question 4

All previous mass media in modern history,including the printing press,use a broadcast model where content is created in a central location by experts.

Question 5

Amazon.com uses Web personalization as a major marketing tool.

Question 6

EDI standards that take advantage of network communications have yet to be fully implemented at the industry level.

Question 7

Retail consumer e-commerce is still growing at double-digit rates.

Question 8

In localized e-commerce,businesses market goods to customers that are only available at a specific location.

Question 9

E-commerce refers to the use of any networking technologies to transact business.

Question 10

Intellectual property refers to all forms of human expression,both tangible and intangible.

Question 11

An example of the service provider business model is Flickr,a photo management and sharing Web site.

Question 12

Ninety-six percent of all U.S.households with Internet access use a broadband connection.

Question 13

Because of outsourcing and increased automation,the costs of system maintenance and content creation have fallen and typically make up less than a quarter of Web site budgets.

Question 14

The Internet shrinks information asymmetry.

Question 15

In general,the cost of hardware,software,and telecommunications for building and operating a Web site has fallen by over 50 percent since 2000.

Question 16

Automobile manufacturing is an example of a vertical market.

Question 17

An example of the content provider business model is Barnesandnoble.com,a retailer of printed books.

Question 18

Podcasting allows subscribers to listen to live,streaming radio and other audio content.

Question 19

Behavioral targeting occurs at two levels: individual Web sites and through ISPs.

Question 20

Net marketplaces may either support contractual purchasing based on long-term relationships with designated suppliers or short-term spot purchasing.

Question 21

Reducing the business process layers in a distribution channel is called:

A)disintermediation.
B)BPR.
C)market segmentation.
D)network effects.

Question 22

The act of engaging consumers in a dialog that dynamically adjusts the experience to the individual describes which dimension of e-commerce technology?

A)Ubiquity
B)Personalization/customization
C)Richness
D)Interactivity

Question 23

The quality of ubiquity,as it relates to e-commerce,is illustrated by:

A)the same set of standards being used across the globe.
B)the spread of plentiful,cheap information.
C)the enabling of commerce worldwide.
D)the availability of the Internet everywhere and anytime.

Question 24

Varying a product's price according to the supply situation of the seller is called ________ pricing.

A)menu
B)flexible
C)dynamic
D)asymmetric

Question 25

A marketplace extended beyond traditional boundaries and removed from a temporal and geographic location is called a(n):

A)exchange.
B)marketspace.
C)online marketplace.
D)e-hub.

Question 26

Based on your reading of the chapter,e-commerce is:

A)still in a revolutionary phase.
B)widely accepted by consumers,although technology is still quickly changing.
C)not yet fully accepted by consumers,although much of its driving technology is firmly in place.
D)well entrenched as a form of modern commerce.

Question 27

Information ________ exists when one party in a transaction has more information that is important for the transaction than the other party.

A)transparency
B)asymmetry
C)complexity
D)discrimination

Question 28

Compared to traditional goods,digital goods have:

A)greater pricing flexibility.
B)lower marketing costs.
C)higher production costs.
D)higher inventory costs.

Question 29

Which of the following is not one of the unique features of e-commerce technology?

A)Information density
B)Transparency
C)Richness
D)Social technology

Question 30

Compared to digital markets,traditional markets have:

A)lower search costs.
B)stronger network effects.
C)higher delayed gratification effects.
D)higher transaction costs.

Question 31

Selling the same goods to different targeted groups at different prices is called:

A)cost customization.
B)cost optimization.
C)price gouging.
D)price discrimination.

Question 32

Which of the following is not a recent development in e-commerce?

A)Wireless Internet connections grow rapidly.
B)Social networking sites become a new platform for e-commerce.
C)The music recording industry is disrupted as music creation and distribution become decentralized.
D)Online entertainment business models surge.

Question 33

Digital goods are goods that are:

A)produced digitally.
B)sold over digital networks.
C)delivered digitally.
D)used with digital equipment.

Question 34

Through what channel did e-commerce first evolve?

A)Online advertising sales
B)Internet portals
C)Online book sales
D)Internet service providers

Question 35

The lowered costs of information storage,processing,and communication,along with the improvement of data quality,has resulted in which unique quality of e-commerce?

A)Information density
B)Richness
C)Customization
D)Interactivity

Question 36

The effort required to locate a suitable product is called:

A)price discrimination.
B)search costs.
C)menu costs.
D)shopping costs.

Question 37

Which feature of Internet technology has had the most effect in the Internet's rapid spread across the globe?

A)Ubiquity
B)Global reach
C)Universal standards
D)Social technology

Question 38

The integration of video,audio,and text marketing messages into a single marketing message and consumer experience describes which dimension of e-commerce technology?

A)Ubiquity
B)Personalization/customization
C)Richness
D)Interactivity

Question 39

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.

Question 40

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.

Question 41

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.

Question 42

EBay is an example of:

A)C2C e-commerce.
B)B2B e-commerce.
C)B2C e-commerce.
D)M-commerce.

Question 43

Selling products and services directly to individual consumers via the Internet best describes:

A)B2B e-commerce.
B)C2C e-commerce.
C)M-commerce.
D)B2C e-commerce.

Question 44

Netflix's public announcement of a reward for a technology solution to its movie recommendation system is an example of:

A)prediction markets
B)behavioral targeting
C)long-tail marketing
D)crowdsourcing

Question 45

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.

Question 46

In which of the following revenue models does a Web site charge a fee for access to some or all of its offerings on a continual,regular basis?

A)Subscription
B)Free/freemium
C)Transaction fee
D)Sales

Question 47

Compared to traditional markets,digital markets have:

A)lower distributed delivery costs.
B)higher marginal costs per unit.
C)equivalent copying costs.
D)similar inventory costs.

Question 48

The process of sourcing goods and materials,negotiating with suppliers,paying for goods,and making delivery arrangements is called:

A)e-procurement.
B)SCM.
C)procurement.
D)sourcing.

Question 49

In which of the following Internet business models does a merchant create an online digital environment that enables people with like interests to share information or buy and sell goods?

A)Community provider
B)Service provider
C)Market creator
D)Transaction broker

Question 50

________ describes the concept that a large group of people is better at making good decisions than a single person.

A)The wisdom of crowds
B)Outsourcing
C)Crowdsourcing
D)Social graphing

Question 51

Exposing an individual to ads that are chosen and based on the recorded and analyzed online behavior of the individual is referred to as:

A)clickstream advertising.
B)behavioral targeting.
C)online profiling.
D)long tail marketing.

Question 52

Which of the following Internet business models does Amazon.com use?

A)Content provider
B)Portal
C)Market creator
D)E-tailer

Question 53

Which of the following businesses utilizes the content provider Internet business model?

A)Amazon.com
B)eBay.com
C)CNN.com
D)Motocross.com

Question 54

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.

Question 55

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.

Question 56

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 2010 were over $3 trillion.

Question 57

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.

Question 58

Consumers selling goods and services electronically to other consumers best describes:

A)disintermediation.
B)C2C e-commerce.
C)M-commerce.
D)B2C e-commerce.

Question 59

Which of the following was the leading online advertising format in 2011?

A)Display ads
B)E-mail
C)Classifieds
D)Search engine

Question 60

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.

Question 61

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

Question 62

In Web server ________,a firm purchases or leases a Web server but locates the server in a vendor's physical facility.

A)outsourcing
B)co-location
C)allocation
D)hosting

Question 63

Before building an e-commerce site,business objectives and functionalities must be translated into a set of precise information:

A)requirements.
B)goals.
C)analytics.
D)objectives.

Question 64

Indirect goods are not involved firsthand in the production process.

Question 65

Which of the following is the least costly way to build a Web site?

A)Outsource the Web site development to overseas vendors.
B)Use a hosted solution and pre-built templates.
C)Build your site yourself from scratch using existing software.
D)Use a site-building package.

Question 66

An extranet that links a large firm to its suppliers and other key business partners is called a(n):

A)e-hub.
B)marketspace.
C)exchange.
D)private industrial network.

Question 67

E-hubs are more ________ than private industrial networks.

A)transaction oriented
B)collaborative
C)independent
D)supply-chain oriented

Question 68

Net marketplaces:

A)focus on continuous business process coordination between companies for supply chain management.
B)are industry owned or operate as independent intermediaries between buyers and sellers.
C)are geared towards short-term spot purchasing.
D)are more relationship oriented than private industrial networks.

Question 69

Price transparency refers to the ability of consumers to discover what merchants actually pay for products.

Question 70

Viral marketing is like traditional word-of-mouth marketing except that it is spread via online communities.

Question 71

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

Question 72

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

A)In 2011,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 applications are especially popular in Europe,Japan,and South Korea.
D)In 2011,the top-grossing category of m-commerce was e-book sales.

Question 73

The Internet enables ________ marketing,by leveraging the fact that there is always some demand,however small,for a product.

A)long-tail
B)behavioral
C)crowdsource
D)prediction

Question 74

Switching costs are the merchants' costs of changing prices.

Question 75

Content providers use ________ systems to process large amounts of very small monetary transactions cost-effectively.

A)subscription
B)mobile payment
C)transaction fee
D)micropayment

Question 76

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)Less than 10 percent
B)Approximately 25 percent
C)At least 50 percent
D)None,as no software will need to be purchased

Question 77

Goods that are involved in the actual production process are referred to as:

A)raw materials.
B)direct goods.
C)purchasing goods.
D)indirect goods.

Question 78

________ is a peer-to-peer market in which participants bet on the outcomes of current events,business,or social trends.

A)Crowdsourcing
B)A net marketplace
C)A prediction market
D)A futures auction

Question 79

A third-party Net marketplace that connects many buyers and suppliers for spot purchasing is called a(n):

A)exchange.
B)vertical market.
C)private exchange.
D)e-hub.

Question 80

The behavioral targeting of ads results in consumers responding ten times more frequently than when delivered ads randomly.