Question 1

Network economics:
A)applies the law of diminishing returns to communities of users.
B)applies traditional economics to networked users.
C)sees the cost of adding new members as inconsequential.
D)balances the high cost of adding new members to a community against the lower cost of using network infrastructure.

Accepted Answer

The answer of Network economics:
A)applies the law of diminishing returns...

Question 2

The emergence of the World Wide Web acted as a disruptive technology for:
A)the typewriter industry.
B)print publishing.
C)PC manufacturers.
D)microprocessor firms.

Accepted Answer

The emergence of the World Wide Web disrupted the print publishing industry as it allowed for digital content to be easily disseminated online, impacting the market for traditional print media.

Question 3

A virtual company:
A)uses the capabilities of other companies without being physically tied to those companies.
B)uses Internet technology to maintain a virtual storefront.
C)uses Internet technology to maintain a networked community of users.
D)provides entirely Internet-driven services, or virtual products.

Accepted Answer

A virtual company is a company that uses the capabilities of other companies without being physically tied to those companies, which allows them to be more flexible and cost-effective. This means that they can operate without owning physical assets or a brick-and-mortar store, and instead rely on partnerships and technology to conduct business. While choices B, C, and D also involve the use of Internet technology, they do not fully capture the defining characteristic of a virtual company, which is its reliance on external capabilities rather than internal resources.

Question 4

Benchmarking:
A)compares the efficiency and effectiveness of your business processes against strict standards.
B)allows industry participants to develop industry-wide standards.
C)is used to measure the speed and responsiveness of information technology.
D)synchronizes the business processes of customers, suppliers, and trading partners.

Accepted Answer

Benchmarking is a process that compares the efficiency and effectiveness of your business processes against strict standards, either internal or external. It helps to identify areas where your organization can improve its performance and make necessary changes.

B, C, and D are not accurate definitions of benchmarking. While industry-wide standards may be developed as a result of benchmarking, it is not the primary purpose. Measuring the speed and responsiveness of information technology is more closely related to performance testing than benchmarking. Synchronizing business processes is a function of supply chain management, which may use benchmarking as one tool among many.

Question 5

Which of the following best describes business globalization?
A)Businesses whose suppliers are located overseas
B)Businesses selling their products worldwide
C)Businesses moving manufacturing overseas
D)All of the above.

Accepted Answer

The answer of Which of the following best describes business...

Question 6

A ________ is a collection of independent firms that use information technology to coordinate their value chains to produce a product or service for a market collectively.
A)value chain
B)business network
C)value web
D)consortia

Accepted Answer

A value web is a collection of independent firms that use information technology to coordinate their value chains to collectively produce a product or service for a market.

Question 7

The ________ strategy is characterized by heavy centralization of corporate activities in the home country of origin.
A)domestic exporter
B)multinational
C)franchise
D)transnational

Accepted Answer

A domestic exporter strategy focuses on exporting products from a home country to other countries. This strategy is characterized by a heavy centralization of corporate activities in the home country, such as manufacturing and marketing. The company does not have significant investments or operations in other countries.

Question 8

________ systems are those in which development occurs at the home base, but operations are handed over to autonomous units in foreign locations.
A)Transnational
B)Decentralized
C)Duplicated
D)Networked

Accepted Answer

Duplicated systems involve development at the home base and then handing over operations to autonomous units in foreign locations.

Question 9

The more any given resource is applied to production, the lower the marginal gain in output, until a point is reached where the additional inputs produce no additional output is referred to as:
A)the point of no return.
B)the law of diminishing returns.
C)supply and demand.
D)inelasticity.

Accepted Answer

The law of diminishing returns states that as more of a resource is applied to production, the marginal gain in output initially increases but eventually starts to decrease, eventually reaching a point where additional inputs produce no additional output. This concept is important in understanding how much of a resource to allocate to production in order to maximize output and minimize costs. The other options (A, C, D) do not accurately describe this concept.

Question 10

All of the following are considered primary activities of a firm except:
A)inbound logistics.
B)sales and marketing.
C)procurement.
D)service.

Accepted Answer

The primary activities of a firm as outlined by Michael Porter's value chain model include inbound logistics, operations, outbound logistics, marketing and sales, and service. Procurement is considered a support activity as it supports the primary activities of the firm by acquiring the necessary resources and materials to carry them out.

Question 11

When the output of some units can be used as inputs to other units, or if two organizations pool markets and expertise that result in lower costs and generate profits, it is often referred to as creating:
A)value webs.
B)value chains.
C)synergies.
D)core competencies.

Accepted Answer

Synergies refer to the integration of the output of different units to create a greater overall benefit. This can come from pooling resources or expertise, as mentioned in the question. Value webs and value chains refer to the interconnected processes involved in creating and distributing a product or service, while core competencies refer to the unique strengths or capabilities an organization possesses that sets it apart from competitors. While some of these concepts may be related to creating synergies, the best choice given the description in the question is C.

Question 12

The support activities of a firm include:
A)inbound logistics, technology, outbound logistics, sales and marketing, and service.
B)inbound logistics, organization infrastructure, outbound logistics, technology, and procurement.
C)organization infrastructure, human resources, sales and marketing, and technology.
D)organization infrastructure, human resources, technology, and procurement.

Accepted Answer

Support activities in a firm typically include organization infrastructure, human resources, technology, and procurement, as they provide the necessary background support to primary activities.

Question 13

An information system can enhance core competencies by:
A)providing better reporting facilities.
B)creating educational opportunities for management.
C)allowing operational employees to interact with management.
D)encouraging the sharing of knowledge across business units.

Accepted Answer

Encouraging the sharing of knowledge across business units can help to enhance core competencies within an organization by ensuring that knowledge is shared and used to improve processes and operations. This can lead to increased efficiency and effectiveness in delivering products or services, which can in turn give the organization a competitive advantage. Providing better reporting facilities or creating educational opportunities for management may also be beneficial, but they may not necessarily be as directly linked to enhancing core competencies as knowledge sharing. Allowing operational employees to interact with management may also be valuable, but again, it may not specifically enhance core competencies.

Question 14

The ________ strategy concentrates financial management and control out of a central home base while decentralizing production, sales, and marketing operations to units in other countries.
A)domestic exporter
B)multinational
C)franchise
D)transnational

Accepted Answer

The multinational strategy centralizes financial management and control at the home base while decentralizing production, sales, and marketing to other countries.

Question 15

How are information systems used at the industry level to achieve strategic advantage?
A)By building industry-wide, IT-supported consortia and symposia
B)By raising the bargaining power of suppliers
C)By encouraging the entry of new competitors
D)By enforcing standards that reduce the differences between competitors

Accepted Answer

Industry-wide, IT-supported consortia and symposia can help standardize practices, share knowledge, and create efficiencies that provide a strategic advantage across the industry.

Question 16

The greatest impact the Internet has had on globalization is in lowering the costs of:
A)labor.
B)telecommunications.
C)network infrastructure.
D)entry to global-scale operations.

Accepted Answer

The Internet has significantly reduced the barriers to entry for businesses to operate on a global scale by providing easier access to international markets and reducing costs associated with reaching a global audience.

Question 17

The most successful solutions or methods for achieving a business objective are called:
A)core processes.
B)best processes.
C)benchmarks.
D)best practices.

Accepted Answer

The term used for the most successful solutions or methods for achieving a business objective is best practices. Option A, core processes, refers to the main activities required to create and deliver a company's product or service. Option B, best processes, is not a commonly used term in business management. Option C, benchmarks, are standards or reference points used to evaluate performance or quality.

Question 18

In a ________ system configuration, separate information systems are designed and managed by each foreign unit.
A)duplicated
B)centralized
C)decentralized
D)networked

Accepted Answer

In a decentralized system configuration, separate information systems are designed and managed by each foreign unit.

Question 19

In network economics, the value of a commercial software vendor's software products:
A)increases as more people use them.
B)decreases as more people use them.
C)increases due to higher marginal gain in output.
D)decreases according to the law of diminishing returns.

Accepted Answer

In network economics, the value of a commercial software vendor's software products increases as more people use them due to network effects. As more people use the software, the network effect leads to increased benefits and marginal gain in output for each user, thus increasing the value of the software.

Question 20

A firm's value chain is linked to the:
A)value webs of its industry.
B)value chains of its suppliers, distributors, and customers.
C)value webs of its suppliers and distributors.
D)value chains of its suppliers and customers.

Accepted Answer

A firm's value chain is connected to the value chains of its suppliers, distributors, and customers. The relationship between a firm and its suppliers, distributors, and customers can have a significant impact on the cost, quality, and overall value of the final product or service. Therefore, understanding and managing these relationships is essential to optimize a firm's value chain.

Quiz 3: Achieving Competitive Advantage With Information Systems

Network economics:

The emergence of the World Wide Web acted as a disruptive technology for:

A virtual company:

Benchmarking:

Which of the following best describes business globalization?

A ________ is a collection of independent firms that use information technology to coordinate their value chains to produce a product or service for a market collectively.

The ________ strategy is characterized by heavy centralization of corporate activities in the home country of origin.

________ systems are those in which development occurs at the home base, but operations are handed over to autonomous units in foreign locations.

The more any given resource is applied to production, the lower the marginal gain in output, until a point is reached where the additional inputs produce no additional output is referred to as:

All of the following are considered primary activities of a firm except:

When the output of some units can be used as inputs to other units, or if two organizations pool markets and expertise that result in lower costs and generate profits, it is often referred to as creating:

The support activities of a firm include:

An information system can enhance core competencies by:

The ________ strategy concentrates financial management and control out of a central home base while decentralizing production, sales, and marketing operations to units in other countries.

How are information systems used at the industry level to achieve strategic advantage?

The greatest impact the Internet has had on globalization is in lowering the costs of:

The most successful solutions or methods for achieving a business objective are called:

In a ________ system configuration, separate information systems are designed and managed by each foreign unit.

In network economics, the value of a commercial software vendor's software products:

A firm's value chain is linked to the: