MGT 300 (EPJJ) Test 1 ~ Answers A. Multiple Choice Questions 1. D 2. B 3. B 4. D 5. B 6. A 7. A 8. A 9. A 10.

B. True and False Questions 1. True 2. True 3. False 4. False 5. False 6. True

7. True 8. False 9. True 10. False

C. Essay Questions
1. Business personnel possess expertise in functional areas such as marketing,

accounting and sales. IT personnel have the technological expertise. This causes a communications gap between the two. IT personnel have their own vocabularies consisting of acronyms and technical terms. Business personnel have their own vocabularies based on their experience and expertise. For both sides to have effective communications the business personnel must seek to achieve an increased level of understanding of IT and the IT personnel must seek to achieved an increased level of understanding of the business. 2. Five characteristics of high quality information are: a) Accuracy - are all the values correct. For example, is the name spelled correctly? Is the dollar amount recorded properly? b) Completeness - are any of the values missing? For example, is the address complete including street, city, state and zip code? c) Consistency is aggregate or summary information in agreement with detailed information? For example, do all total fields equal the true total of the individual fields?

d) Uniqueness is each transaction, entity and event represented only once in the information? For example, are they any duplicate customers? e) Timeliness is the information current with respect to the business requirements? For example, is information updated weekly, daily or hourly? 3. The impact of low quality information on an organization are: a) Missing information (no first name) b) Incomplete information (no street) c) Probable duplicate information (similar names, same address, phone number) d) Potential wrong information (are the phone and fax numbers the same or is this an error?) e) Inaccurate information (invalid e-mail) f) Incomplete information (missing area codes) The benefits of high quality information on an organization can significantly improve the chances of making a good business decision and directly affect an organizations bottom line. 4. The benefits an organization can receive from implementing an efficient and effective SCM system are decrease the power of its buyers, increase its own supplier power, increase switching costs to reduce the threat of substitute products or services, create entry barriers thereby reducing the threat of new entrants and increase efficiencies while seeking a competitive advantage through cost leadership. 5. The definition of an information system is a business application of the computer. It is made up of the database, application programs and manual and machine procedures. It also encompasses the computer systems that do

the processing. Three basic interacting components or functions of an information system are: a) Processing the data the database stores the subjects of the business (master files) and its activities (transaction files). The application programs provide the data entry, updating, query and report processing. b) Transaction processing the daily work is the online, interactive processing of the business transactions and updating of customers, inventory and vendor files (master files). c) Batch processing at the end of the day or other period, programs print reports and update files that were not updated on a daily basis. Periodically, files must be updated for routine maintenance such as adding and deleting employees and making changes to product descriptions. 6. The concept of electronic commerce is the purchasing, selling and exchanging of goods and services over computer network such as the Internet through which transactions or terms of sale are performed electronically. Technologies businesses are using to support this commercial process are: a) B2B (Business-to-Business) companies doing business with each other such as manufacturers selling to distributors and wholesalers selling to retailers. Pricing is based on quantity of order and is often negotiable.
b) B2C (Business-to-Consumer) businesses selling to the general public

typically through catalogs utilizing shopping cart software.

c) C2B (Consumer-to-Business) a consumer posts his project with a set

budget online and within hours companies review the consumers requirements and bid on the project. The consumer reviews the bids and selects the company that will complete the project.

d) C2C (Consumer-to-Consumer) there are many sites offering free classifieds, auctions and forums where individuals can buy and sell thanks to online payment systems like PayPal where people can send and receive money online with ease. eBays auction service is a great example of where person-to-person transactions take place everyday. 7. The concept of business process reengineering (BPR) is to make all your processes the best-in-class. Companies frequently strive to improve their business processes by performing tasks faster, cheaper and better. Companies often follow the same indirect path for doing business not realizing there might be a different, faster and more direct way of doing business such as Progressive Insurance. 8. The five common characteristics of high quality information are: a) Accuracy determines if all values are correct. Example is the name spelled correctly? b) Completeness determines if any values are missing. Example is the address complete? c) Consistency ensures that aggregate or summary information is in agreement with detailed information. Example do totals equal the true total of the individual fields? d) Uniqueness ensures that each transaction, entity and event is represented only once in the information. Example are there any duplicate customers? e) Timeliness determines if the information is current with respect to the business requirement. Example is the information updated weekly? 9. Information technology can help to achieve business success: a) Significance information technology has grown to permeate the business world, affecting how companies make and market their products as well as

how people communicate and accomplish their jobs in modern organizations.

b) Production technology allowed modern companies to make great strides

in operational efficiency and the effectiveness of human resources. Automation technology such as assembly lines and computer-controlled machinery can allow companies to produce unprecedented volumes of goods and advances in transportation technology allow businesses to ship their products anywhere in the world. c) Communication technology leveraging advances in communications technology is imperative to surviving in the modern business world. Advances in cellular phone technology have revolutionized the way businesspeople communicate with clients, employees, suppliers and strategic partners.
d) Considerations while information technology solutions can contribute to

the success of your organization, there are a number of unique costs to consider. In addition, to the cost of implementing an IT solutions, we must employ highly educated and specialized workers to maintain, monitor, expand and repair our IT infrastructure. 10. The issues affected by technology advances are: a) Human use of technology began with the conversion of natural resources into simple tools. The prehistorically discovery of the ability to control fire increased the available sources of food and the invention of the wheel helped humans in travelling in and controlling their environment.
b) Society technology has helped develop more advanced economies

(including todays global economy) and has allowed the rise of a leisure class. Many technological processes produce unwanted by-products, known as pollution and deplete natural resources to the detriment of the earth and its environment. Various implementations of technology

influence the values of a society and new technology often raises new ethical questions. Examples include the rise of the notion of efficiency in terms of human productivity, a term originally applied only to machines and the challenge of traditional norms.

D. Case Study (Chapter 5 Case of Baltzan Information Text Book)

1.