..

Chapter 1
Information Systems in Global
Business Today
1. 1. Internet advertising is growing at a rate of more than 30 percent a year.

Answer: True ​ ​

2. A business model describes how a company produces, delivers, and sells a product or service tto
create wealth.

Answer: True ​ ​

3. Information technology (IT) consists of all the hardware that a firm needs to use in order to achieve
its business objectives, whereas information systems consist of all the software and business
processes needed.
Information technology:
Answer: False ​ ​ The hardware and software a business uses to achieve
objectives
Information system: interrelated components that
Computers are only part of an information system. manage information to:
4.
± Support decision making and control
± Help with analysis, visualization, and product
Answer: True ​ ​

5. Information systems‫ ز‬describes the behavioral approach to information systems, whereas computer
literacy describes the technical approach.
Computer literacy
Answer: False ​ ​ focuses primarily on knowledge of information technology.

6. The dimensions of information systems are management, organizations, and information technology.

Answer: True ​ ​

7. In order to understand how a specific business firm uses information systems, you need to know
something about the hierarchy and culture of the company.

Answer: True ​ ​

8. Developing a new product, fulfilling an order, or hiring a new employee are examples of business
 S processes.
D
w Answer: True
D ​ ​
D

9. Business processes are logically related tasks for accomplishing tasks that have been formally
encoded by an organization.
!"
Answer: False ​ ​

10. A network requires at least two computers and a shared resource, such as a printer.

Answer: False ​ ​ A network links two or more computers to share data or

resources, such as a printer.

11. . An IT infrastructure provides the platform on which the firm can build its information systems.

Answer: True ​ ​

12. (Analysis)

UPS’s use of Web-based tools that allow customers to embed UPS functions such as tracking and
cost calculations into their own Web sites was an information s
ystems solution used to achieve customer intimacy.

Answer: True ​ ​

13. A fully digital firm produces only digital goods or services.

14.
Answer: False ​ ​

15. There are four major business functions: Sales and marketing; manufacturing and production;
finance and accounting; and information technology. business functions
± Sales and marketing
± Human resources
Answer: False ​ ​ ± Finance and accounting
± Manufacturing and production
16. In the behavioral approach to information systems, technology is ignored in favor of understanding
the psychological, social, and economic impacts of systems.

Answer: False The behavioral approach does not ignore technology.

​ ​

17. Government and private sector standards are examples of complementary social assets required to
optimize returns from IT investments.

IT-enriched educational programs raising labor force computer literacy

Answer: True ​ ​ Standards (both government and private sector)

18. Knowledge workers assist with paperwork at all levels of the firm.

Answer: False ​ ​

#
19. A firm that invests in efficient business processes is making an investment in organizational
complementary assets.

Answer: True ​ ​
$ %&

20. A substantial part of management responsibility is creative work driven by new knowledge and
information.

Answer: True ​ ​

21. Intranets allow firms to work easily with third-party suppliers and vendors.

Answer: False ​ ​ .!‫وردين والبائع! الخارجي‬1‫تسمح الشبكات الداخلية للشركات بالعمل بسهولة مع ا‬

22. The six important business objectives of information technology are new products, services, and
business models; customer and supplier intimacy; survival; competitive advantage; operational
excellence; and:

a. ​improved flexibility.
b. ​improved decision making.
c. ​improved business practices.
d. ​improved efficiency.

Answer: b ​ ​

23. Dell Computer’s use of information systems to improve efficiency and implement “mass
customization” techniques to maintain consistent profitability and an industry lead
# illustrates which
business objective?

a. ​Improved flexibility
b. ​Improved business practices
c. ​Competitive advantage
d. ​Survival

Answer: c
​ ​

24. The use of information systems because of necessity is:

a. ​survival.
b. ​improved business practices.
c. ​competitive advantage.
d. ​improved flexibility.

Answer: a ​ ​

25. (Analysis)
 Which of the following choices may lead to competitive advantage (1) new products, services, and
business models; (2) charging less for superior products; (3) responding to customers in real time?

a. ​1 only
b. ​1 and 2
c. ​2 and 3
d. ​1, 2, and 3

Answer: d
​ ​

26. Verizon’s implementation of a Web-based digital dashboard to provide managers with real-time
Pinformation such as customer complaints is an example of:

a. improved flexibility.
b. improved decision making.
c. improved efficiency.
d. c​ ustomer and supplier intimacy.

Answer: b ​Difficulty: Medium ​Reference: p. 12

27. The move of retail banking to use ATMs after Citibank unveiled its first ATMs illustrates the
information system business objective of:

a. ​improved efficiency.
b. ​customer and supplier intimacy.
c. ​survival.
d. ​competitive advantage.

Answer: c ​Difficulty: Medium ​Reference: p. 13

28. An information system can be defined technically as a set of interrelated components that collect (or
retrieve), process, store, and distribute information to support:

a. ​decision making and control in an organization.

b. ​communications and data flow.
c. ​managers analyzing the organization’s raw data.
d. ​the creation of new products and services.

Answer: a ​Difficulty: Medium ​Reference: p. 14

29. The three activities in an information system that produce the information organizations use to control
operations are:

a. ​information retrieval, research, and analysis.

b. ​input, output, and feedback.
c. ​input, processing, and output.
d. ​data analysis, processing, and feedback.

Answer: c ​Difficulty: Easy ​Reference: pp. 14–15

30. Order data for baseball tickets and bar code data are examples of:

a. raw input.
b. raw output.
c. customer and product data.
d. sales information.

Answer: a ​Difficulty: Easy ​Reference: p. 15

31. (Analysis)

The average number of tickets sold daily online is an example of:

a. ​input.
b. ​raw data.
c. ​meaningful information.
d. ​output.

Answer: c ​ ​

32. Output:

a. ​is feedback that has been processed to create meaningful information.

b. ​is information that is returned to appropriate members of the organization to help them
evaluate the input stage.
c. ​transfers data to the people who will use it or to the activities for which it will be used.
d. ​transfers processed information to the people who will use it or to the activities for which it
will be used.

Answer: d ​Difficulty: Easy ​Reference: p. 15

33. Converting raw data into a more meaningful form is called:

a. ​capturing.
b. ​processing.
c. ​organizing.
d. ​feedback.

Answer: b ​Difficulty: Easy ​Reference: p. 15

34. (Analysis)

An example of raw data from a national chain of automobile stores would be:

a. an average of 13 Toyotas are sold daily in Kentucky.

b. 30 percent increase in Toyota RAV 4 sales during September in Kentucky.
c. 1 Toyota RAV4 sold March 3, 2005 in Louisville, Kentucky.
d. all of the above.m
 Answer: c ​Difficulty: Hard ​Reference: p. 14

35. The field that deals with behavioral issues as well as technical issues surrounding the development, use,
and impact of information systems used by managers and employees in the firm is called:

a. ​information systems literacy.

b. ​information systems architecture.
c. ​management information systems.
d. ​information technology infrastructure.

Answer: c ​Difficulty: Medium ​Reference: pp. 16–17

In a hierarchical organization, the upper levels consist of:

a. ​managerial and professional employees. The upper levels of the hierarchy

b. ​managerial, professional, and technical employees. consist of managerial, professional,
c. ​professional and operational employees. and technical employees
d. ​managerial, professional, and operational employees.

Answer: b ​Difficulty: Medium ​Reference: p. 17

36. A
# hierarchy:

a. ​is based on a clear-cut division of labor.

b. ​is composed primarily of experts trained for different functions.
c. ​is a pyramid structure of rising authority and responsibility.
d. a​ ll of the above. Authority and responsibility in a
business firm are organized as a
hierarchy, or a pyramid
Answer: c ​Difficulty: Easy ​Reference: p. 17 structure.

37. The fundamental set of assumptions, values, and ways of doing things that has been accepted by most
of a company’s members is called its:

a. ​culture.
b. ​environment.
c. ​atmosphere. culture, or fundamental set of assumptions,
d. ​values. values, and ways of doing things,

Answer: a ​Difficulty: Easy ​Reference: p. 18

38. Business processes:

a. ​include informal work practices.

b. ​are used primarily for sales and accounting functions.
c. ​are governed by information technology.
d. ​are logically related tasks used primarily by operational personnel.
business processes have
Answer: a ​Difficulty: Easy ​Reference: p. 18 been written down, but others
are informal work practices,

39. Data management technology consists of:

Data management technology consists of the
software governing the orga-
nization of data on physical storage media.
 a. ​the physical hardware and media used by an organization for storing data.
b. ​the detailed, preprogrammed instructions that control and coordinate the computer hardware
components in an information system.
c. ​the software governing the organization of data on physical storage media.
d. ​the hardware and software used to transfer data.

Answer: c ​Difficulty: Medium ​Reference: p. 19

40. The hardware and software used to transfer data in an organization is called:

a. ​data management technology.

b. ​networking and data management technology.
c. ​data and telecommunications technology.
d. ​networking and telecommunications technology.

Answer: d ​Difficulty: Medium ​Reference: p. 19

41. Networking and telecommunications technologies, along with computer hardware, software, data
management technology, and the people required to run and manage them, constitute an organization’s:

a. ​data management environment.

b. ​networked environment.
c. ​IT infrastructure.
d. ​information system.

Answer: c ​Difficulty: Medium ​Reference: pp. 19–20

42. An example of a business using information systems to create new products and services is:

a. ​Wal-Mart’s RetailLink system.

b. ​the Mandarin Oriental hotel’s customer-preference tracking system.
c. ​Verizon’s Web-based digital dashboard.
d. ​Apple Inc.’s iPod.

Answer: d ​Difficulty: Hard ​Reference: p. 11

43. An example of a business using information systems to attain operational excellence is:

a. ​Wal-Mart’s RetailLink system.

b. ​the Mandarin Oriental hotel’s customer-preference tracking system.
c. ​Verizon’s Web-based digital dashboard.
d. ​Apple Inc.’s iPod.

Answer: a ​Difficulty: Hard ​Reference: p. 10

44. An example of a business using information systems for customer and supplier intimacy is:

a. ​Wal-Mart’s RetailLink system.

 b. t​ he Mandarin Oriental hotel’s customer-preference tracking system.
c. ​Verizon’s Web-based digital dashboard.
d. ​ pple Inc.’s iPod.
A

Answer: b ​Difficulty: Medium ​Reference: p. 11

45. Maintaining the organization’s financial records is a business function of:

a. ​accounting.
b. ​finance.
c. ​sales.
d. ​marketing.

Answer: a ​Difficulty: Easy ​Reference: p. 18

46. (Evaluation)
Based on the examples in the chapter, if you were asked to formulate a plan for a regional drive-in
restaurant chain’s efforts to use information technology to attract customers, what would be the best use
of information technology from the list below:
a. Use IT to increase supplier loyalty.
b. Use IT to increase operational efficiency.
c. Use IT to create new products and business models.
d. Use IT to help survive government reporting requirements.
e. Use IT to achieve customer intimacy.
Answer: e ​Difficulty: Hard ​Reference: p. 11
(Evaluation in the sense of appraise, assess, estimate, judge)

47. (Analyze)
The fact that online advertising revenues are growing at 30% a year, while offline traditional
advertising is growing at about 5% a year, suggests that:

a. Internet advertising is very inexpensive.

b. offline traditional advertising is not very effective.
c. the Internet is transforming the traditional advertising business model.
d. new technologies are more efficient at selling to customers.

Answer: c ​Difficulty: Hard ​Reference p. 11

48. ​

'
​
​
•Technology dimension of information systems
–Computer hardware and software ‫اكتر من جواب صح‬
 –Data management technology
–Networking and telecommunications technology
•Networks, the Internet, intranets and extranets, World Wide Web
– IT infrastructure: provides platform that system is built on

Answer: c ​Difficulty: Hard ​Reference: p. 3

49. In a business hierarchy, the level that is responsible for monitoring the daily activities of the business is:

a. ​middle management.
B. ​service workers.
c. ​production management.
d. ​operational management.

Answer: d ​Difficulty: Medium ​Reference: p. 17

50. Which of the following are environmental actors that interact with an organization and its information
systems?

a. ​Customers Environmental actors, such as customers,

b. ​Suppliers suppliers, competitors, stockholders, and
c. ​Regulatory agencies regulatory agencies, interact with the
organization and its information systems.
d. ​All of the above

Answer: d ​Difficulty: Medium ​Reference: p. 15

51. From a business perspective, raw data is transformed systematically during various stages, transforming
it into valuable information, in a process called: Describe the flow of information through
the business information value chain.
a. ​the information value chain.
b. ​the IT value chain.
c. ​information processing.
d. ​feedback.

Answer: a ​Difficulty: Medium ​Reference: p. 23

52. (Application)

A corporation that funds a political action committee, which in turn promotes and funds a political
candidate who agrees with the values of that corporation, could be seen as investing in which main
category of complementary assets?

a. ​Managerial
b. ​Governmental
c. ​Social
d. ​Organizational

Answer: c ​Difficulty: Medium ​Reference: p. 25

53. Apple Computer dominates the online legal music sales industry primarily because of a failure of
recording label companies to:

a. ​invest in technology.
b. ​adopt a new business model.
c. ​invest in complementary assets.
‫ن ادوره‬Ooh
‫مل‬
‫وانا‬
d. ​modernize their information value chain. ‫فالكتاب‬
‫وبعدين‬
Answer: b ​Difficulty: Medium ​Reference: p. 24 ‫احصلو‬

54. An example of an organizational complementary asset is:

an appropriate business model,
(
efficient business processes,
a. ​using the appropriate business model. decentralization of authority, highly
b. ​as collaborative work environment. distributed
decision rights, and a strong
c. ​laws and regulations. information system (IS) development
d. ​all of the above. team. I
mportant managerial complementary
Answer: a ​Difficulty: Medium ​Reference: p. 25 assets

55. An example of a social complementary asset is:

a. t​ echnology and service firms in adjacent markets.

b ​training programs. ‫جتماعية‬L‫صول التكميلية ا‬O‫مثال على ا‬
c. ​ istributed decision-making rights.
d ‫جاورة‬1‫سواق ا‬O‫شركات التكنولوجيا والخدمات في ا‬
d. ​all of the above.

Answer: a ​Difficulty: Medium ​Reference: p. 25

56. Disciplines that contribute to the technical approach to information systems are:

a. ​computer science, engineering, and networking.

b. ​operations research, management science, and computer science.
c. ​engineering, utilization management, and computer science.
d. ​management science, computer science, and engineering.

Answer: b ​Difficulty: Hard ​Reference: p. 26

57. The discipline that focuses on mathematical techniques for optimizing parameters of organizations,
such as transportation and inventory control is:

a. ​management science.
b. ​MIS.
c. ​operations research.
d. ​utilization management.

Answer: c ​Difficulty: Hard ​Reference: p. 27

58. Sociologists study information systems with an eye to understanding:

a. ​how systems affect individuals, groups, and organizations.

b. ​how human decision makers perceive and use formal information.
 c. ​how new information systems change the control and cost structures within the firm.
d. ​the production of digital goods.

Answer: a ​Difficulty: Medium ​Reference: p. 27

59. Psychologists study information systems with an eye to understanding:

a. ​how systems affect individuals, groups, and organizations.

b. ​how human decision makers perceive and use formal information.
c. ​how new information systems change the control and cost structures within the firm.
d. ​the production of digital goods.

Answer: b ​Difficulty: Medium ​Reference: p. 27

60. The costs for firms operating on a global scale have been drastically reduced by:

a. ​networking technology.
b. ​investments in organizational complementary assets.
c. ​the Internet.
d. ​the rise of digital content.

Answer: c ​Difficulty: Medium ​Reference: p. 7

61. Key corporate assets are:

.‫الية والبشرية‬1‫صول ا‬O‫ساسية وا‬O‫لكية الفكرية والكفاءات ا‬1‫ا‬
a. ​intellectual property, core competencies, and financial and human assets.
b. ​production technologies and business processes for sales, marketing, and finance.
.knowledge and the firm’s tangible assets, such as goods or services.
d. ​time and knowledge.

Answer: a ​Difficulty: Hard ​Reference: p. 7

62. Overproduction or underproduction of goods and services, misallocation of resources, and poor
response times are the results of a firm’s having: )!*+,-* /00-1/*2 . !34,15/*!,3
6

a. ​poor relationships with suppliers.

b. ​poor relationships with customers.
c. ​information.
d. ​surplus of information.

Answer: c ​Difficulty: Hard ​Reference: p. 12

63. A firm that must invest in new information systems capabilities in order to comply with federal
legislation can be said to be investing to achieve which business objective?

a. ​Customer intimacy
b. ​Operational excellence
c. ​Survival
d. ​Improved reporting
 Answer: c ​Difficulty: Medium ​Reference: p. 13

64. Which of the following would not be used as an input for an information system?

a. ​Digital dashboard
b. ​Handheld computer
c. ​Bar-code scanner
d. ​Cell phone

Answer: a ​Difficulty: Medium ​Reference: p. 15

65. Which field of study focuses on both a behavioral and technical understanding of information systems?

a. ​Sociology
b. ​Operations research
c. ​Economics
d. ​Management information systems
7&8
Answer: d ​Difficulty: Medium ​Reference: pp. 16–17

66. The three principle levels within a business organization hierarchy are:

a. ​senior management, operational management, and service workers.

b. ​senior management, middle management, and operational management.
c. ​senior management, operational management, and information systems.
d. ​senior management, middle management, and service workers.

Answer: b ​Difficulty: Hard ​Reference: p. 17

67. Engineers, scientists, or architects, who design new products or services for a firm, belong to which
level of a business hierarchy?

a. ​Middle management
b. ​Production workers
c. ​Knowledge workers
d. ​Data workers

Answer: c ​Difficulty: Medium ​Reference: p. 17

68. Which main business function is responsible for maintaining employee records?

a. ​Sales and marketing

b. ​Human resources
c. ​Finance and accounting
d. ​Manufacturing and production

Answer: b ​Difficulty: Easy ​Reference: p. 18

69. An organizational element in the UPS tracking system described in the chapter is:
#
 a. ​the specification of procedures for identifying packages with sender and recipient
information.
b. ​monitoring service levels.
c. ​promoting the company strategy of low-cost, superior service.
d. ​the use of handheld computers and networks for managing package delivery.

Answer: a ​Difficulty: Hard ​Reference: p. 22

70. A managerial element in the UPS tracking system described in the chapter is:

a. ​taking inventory.
b. ​providing package status reports to customers.
c.the decision to use automation.
d. ​in-house package tracking software.

Answer: c ​ ​

Fill In the Blanks

71. Information is data that has been shaped into a form that is meaningful to human beings.

72. Feedback is output returned to appropriate members of the organization to help them evaluate
or correct the input stage.

73. The Internet is a global network that uses universal standards to connect millions of different
networks around the world.

74. Computer software consists of the detailed, preprogrammed instructions that control and
coordinate the computer hardware components in an information system.
​ ​

75. The World Wide Web/Web/WWW is a service provided by the Internet that uses universally
accepted standards for storing, retrieving, formatting, and displaying information in a page
format.

76. Extranets are private corporate networks extended to authorized users outside the organization.

77. j The key elements of an organization are its people, structure, business processes, politics, and
culture.

78.
In asociotechnical perspectiveview, the performance of a
system is optimized when both the technology and the organization mutually adjust to one
another until a satisfactory fit is obtained.
​ ​ ​
 79. Senior management makes long-range strategic decisions about the firm’s products and
services.
​ ​ ​

80. Investments in organization and management, such as investments in new business models and
training, are also known as organizational and management capital.
​ ​ ​

‫ حسبنا اهلل و نعم الوكيل‬،‫ إنك على كل شيء قدير‬،‫ فرده عند حاجتي إليه‬،‫اللهم إني أستودعك ما قرأت و ما حفظت و ما تعلمت‬
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 1) Which of the D Upgrade to remove ads
Only $1/month
following is not one
of the six strategic
business objectives
of information
systems?
A) New products
and services
B) Improved
decision making
C) Competitive
advantage
D) Improved
employee morale
E) Survival

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Page 2 of 74
 2) Verizon's use of a B
web-based digital
dashboard to
provide managers
with precise real-
time information
enabled it to
improve which of
the following?
A) Compliance with
regulations
B) Managerial
decision making
C) Efficiency in
creation of new
products
D) Employee morale
E) Intimacy with its
suppliers

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Page 3 of 74
 3) Which of the E
following may lead
to competitive
advantage?
1. New products,
services, and
business models
2. Charging less for
superior products
3. Responding to
customers in real
time
A) 1 only
B) 1 and 2
C) 2 and 3
D) 1 and 3
E) 1, 2, and 3

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Page 4 of 74
 4) A firm that invests E
in an information
system because it is
a necessity of doing
business does so
because it is seeking
to achieve which of
the following
business objectives?
A) Operational
excellence
B) Improved
decision making
C) Competitive
advantage
D) Customer
intimacy
E) Survival

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Page 5 of 74
 5) The Mandarin D
Oriental's use of
computer systems
to keep track of
guests' preferences
is an example of
which of the
following?
A) Improved
flexibility
B) Improved
decision making
C) Improved
efficiency
D) Customer
intimacy
E) Operational
excellence

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Page 6 of 74
 6) Competitors were C
seeking which of the
following business
objectives when
they rushed to
provide ATMs after
Citibank introduced
the first ATMs in
New York?
A) Improved
efficiency
B) Customer and
supplier intimacy
C) Survival
D) Competitive
advantage
E) Improved
decision making

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Page 7 of 74
 7) Which of the A
following is the key
business metric
behind the
technologies
implemented by
Kroger, as discussed
in the chapter-
opening case?
A) Higher customer
satisfaction levels
B) Survival
C) Improved
employee morale
D) Improved
decision making
E) Reduced cost of
supplies

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Page 8 of 74
 8) Which of the D
following is an
example of a
business using
information systems
to create a new
product?
A) Walmart's
RetailLink system
B) The Mandarin
Oriental's use of
computers to keep
track of guest
preferences
C) Verizon's use of a
web-based digital
dashboard to
provide real-time
company
information for
managers
D) Apple's creation
of the iPod
E) Kroger's use of
sensors to monitor
cold food storage
temperatures

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Page 9 of 74
 9) Walmart B
exemplifies the
power of
information systems
coupled with state-
of-the-art business
practices and
supportive
management to
achieve which of the
following?
A) New products
and services
B) Operational
efficiency
C) Survival
D) Customer
intimacy
E) Competitive
advantage

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Page 10 of 74
 10) How much did D
American
businesses spend on
information systems
hardware, software,
and
telecommunications
equipment in 2015?
A) About $100
million
B) About $1 billion
C) About $100
billion
D) About $1 trillion
E) About $10 trillion

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Page 11 of 74
 11) To make sure they C
stock clothes that
their customers will
purchase, a
department store
implements a new
application that
analyzes spending
levels at their stores
and cross-
references this data
to popular clothing
styles. Which of the
following business
objectives is this
information
intended to
support?
A) Customer
intimacy
B) Survival
C) Operational
excellence
D) Improved
decision making
E) New products
and services

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Page 12 of 74
 12) Approximately D
what percent of U.S.
businesses have
some form of
remote work
program?
A) About 15 percent
B) About 25 percent
C) About 35 percent
D) About 60 percent
E) About 75 percent

13) All of the E

following are new
technology-related
trends in MIS
except:
A) cloud computing.
B) big data.
C) IoT.
D) the mobile digital
platform.
E) co-creation of
business value.

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 14) Which of the B
following statements
about digital firms is
not true?
A) In digital firms,
time shifting and
space shifting are
the norm.
B) Today, most firms
are fully digital.
C) Digital firms offer
extraordinary
opportunities for
flexible global
organization and
management.
D) Digital firms
sense and respond
to their
environments more
rapidly than
traditional firms.
E) Digital firms have
more flexibility to
survive in turbulent
times.

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 15) A firm that must C
invest in new
information systems
capabilities in order
to comply with
federal legislation is
investing to achieve
which business
objective?
A) Customer
intimacy
B) Operational
excellence
C) Survival
D) Creation of new
products
E) Improved
decision making

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 16) The enormous B
volume of data
generated by
Internet activity,
such as web traffic,
email, and social
media is referred to
as:
A) IoT.
B) big data.
C) the mobile digital
platform.
D) cloud computing.
E) business
intelligence.

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 17) Which of the C
following is not one
of the current
changes taking
place in information
systems
technology?
A) Growing business
use of big data
B) Growth in cloud
computing
C) Growth in the PC
platform
D) Emerging mobile
digital platform
E) Increased usage
of data generated
by the Internet of
Things

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 18) Thomas A
Friedman's
description of the
world as "flat" refers
to:
A) the flattening of
economic and
cultural advantages
of developed
countries.
B) the use of the
Internet and
technology for
instantaneous
communication.
C) the reduction in
travel times and the
ubiquity of global
exchange and
travel.
D) the growth of
globalization.
E) the increased use
of global currencies.

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 19) In 2015, what C
percent of the U.S.
economy resulted
from foreign trade?
A) 10 percent
B) 25 percent
C) 30 percent
D) 50 percent
E) 66 percent

20) All of the D

following describe
the effects of
globalization
except:
A) significant
decreases in
operating costs.
B) reduction of
labor costs through
outsourcing.
C) ability to find
low-cost suppliers.
D) increases in
transaction costs.
E) replication of
business models in
multiple countries.

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 21) How many C
service jobs move
offshore to lower-
wage countries in a
typical year?
A) 3,000
B) 30,000
C) 300,000
D) 3 million
E) 30 million

22) Which of the B

following statements
is not true?
A) In 2015, American
businesses invested
about $1 trillion in
information systems
hardware, software,
and
telecommunications
equipment.
B) In 2015, American
businesses spent
$500 billion on
business and
management
consulting and
information
technology services.
C) Private business
investment in
information

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 technology has
grown from 21
percent of total
invested capital in
1999 to 37 percent
of all invested
capital in 2015.
D) Most of the
business value of IT
investment derives
from organizational,
management, and
cultural changes
inside firms.
E) Much of the
money spent by
American
businesses on
business and
management
consulting involves
redesigning firms'
business operations
to take advantage of
new technologies.

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 23) Approximately C
how many
Americans access
the Internet using a
smartphone or
tablet?
A) 118 million
B) 172 million
C) 194 million
D) 220 million
E) 258 million

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 24) Which of the B
following statements
is not true?
A) Many Fortune
500 U.S. firms derive
more than half their
revenues from
foreign operations.
B) Most PCs
manufactured in
China use
microprocessor
chips manufactured
in Korea.
C) Eighty percent of
the toys sold in the
United States are
manufactured in
China.
D) In 2015, 60
percent of Apple's
revenue was
generated outside
of the United States.
E) Technology
companies are
particularly
dependent on
offshore revenue.

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 25) Internet B
advertising is
growing at
approximately 5
percent a year.
A) TRUE
B) FALSE

26) Creating a A
marketing plan is an
example of a
business process.
A) TRUE
B) FALSE

27) In order to be B
considered a digital
firm, all of the firm's
significant business
relationships and
core business
processes must be
digitally enabled.
A) TRUE
B) FALSE

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 28) A business A
model describes
how a company
produces, delivers,
and sells a product
or service to create
wealth.
A) TRUE
B) FALSE

29) Private business A

investment in
information
technology
constituted 37
percent of all
invested capital in
2015.
A) TRUE
B) FALSE

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 30) You are starting Yes, the firm could be a digital firm.
a small bike As long as most of its relationships
messenger with customers, employees, and
company. Given suppliers are digitally enabled. For
your type of example, the company can use cell
services (hand- phones and information systems to
delivering packages order and organize deliveries and
within a small to connect and direct employees to
geographical area), track the deliveries.
could your firm be a
digital firm? If so,
what would make
this a digital firm?
Short Answer:

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 31) What are the The main organizational changes
main changes taking taking place are:
place in 1. businesses using social
organizational use networking platforms to deepen
of information interactions with employees,
systems? Which of customers, and suppliers,
these do you think is 2. telework gaining momentum in
having the greatest the workplace, with growing
impact on numbers of people working away
businesses? from a traditional office, and
Short Answer: 3. co-creation of business value,
with the sources of business value
shifting from products to solutions
and experiences and from internal
sources to networks of suppliers
and collaboration with customers.

The increase in collaboration is

having the greatest impact, as
customers are essentially gaining
greater control in determining the
end product, businesses who are
flexible enough to listen to and
respond to customer demand will
be more successful.

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 32) The three E
activities in an
information system
that produce the
information
organizations use to
control operations
are:
A) information,
research, and
analysis.
B) input, output, and
feedback.
C) data, information,
and analysis.
D) data analysis,
processing, and
feedback.
E) input, processing,
and output.

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 33) RFID sensor- A
generated data on
stored food items
such as storage
location is an
example of:
A) raw input.
B) raw output.
C) customer and
product data.
D) sales information.
E) information
systems.

34) The total C

number of food
items with storage
temperatures
problems is an
example of which of
the following?
A) Input
B) Raw data
C) Meaningful
information
D) Feedback
E) Processing

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 35) Output: D
A) is feedback that
has been processed
to create meaningful
information.
B) is information that
is returned to
appropriate
members of the
organization to help
them evaluate the
input stage.
C) transfers data to
the people who will
use it or to the
activities for which it
will be used.
D) transfers
processed
information to the
people who will use
it or to the activities
for which it will be
used.
E) converts raw
input into a
meaningful form.

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 36) Converting raw B
data into a more
meaningful form is
called:
A) capturing.
B) processing.
C) organizing.
D) feedback.
E) analysis.

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 37) Which of the C
following is an
example of raw data
from an automobile
manufacturer?
A) An average of 120
Subarus sold daily in
New York in 2016
B) 1,200 Subaru
Outbacks sold
during the first
quarter 2016 in New
York
C) One Subaru
Outback sold July
27, 2016 in Mohegan
Lake, New York for
$24,000
D) Annual sales of
Subaru Outbacks
increased 5.3
percent
E) An average sale
price of $25,500 for
all Subaru Outbacks
sold during July 2016
in Mohegan Lake,
New York

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 38) In a hierarchical B
organization, the
upper level consists
of:
A) scientists.
B) senior
management.
C) professional
employees.
D) data workers.
E) knowledge
workers.

39) The fundamental A

set of assumptions,
values, and ways of
doing things that has
been accepted by
most of a company's
members is called
its:
A) culture.
B) environment.
C) atmosphere.
D) business process.
E) mission.

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 40) Data E
management
technology consists
of which of the
following?
A) Physical
hardware and media
used by an
organization for
storing data
B) Detailed,
preprogrammed
instructions that
control and
coordinate the
computer hardware
components in an
information system
C) Two or more
computers to share
data or resources
D) Hardware and
software used to
transfer data
E) Software
governing the
organization of data
on physical storage
media

41) Which of the E

following statements
best describes

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 organizational
culture?
A) It encompasses
the sum of beliefs
and assumptions by
all members.
B) It enables the
organization to
transcend the
different levels and
specialties of its
employees.
C) It reflects the
senior
management's
perspective on the
organization and
goals.
D) It allows a
company to achieve
greater operational
efficiency.
E) It is a
fundamental set of
assumptions, values,
and ways of doing
things that has been
accepted by most
members of the
organization.

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 42) Networking and C
telecommunications
technologies, along
with computer
hardware, software,
data management
technology, and the
people required to
run and manage
them, constitute an
organization's:
A) data
management
environment.
B) networked
environment.
C) information
technology (IT)
infrastructure.
D) information
system.
E) culture.

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 43) Maintaining the B
organization's
financial records is a
central purpose of
which main business
function?
A) Manufacturing
and accounting
B) Finance and
accounting
C) Sales and
manufacturing
D) Finance and sales
E) Human resources

44) All of the E

following are
examples of
environmental
actors in an
information system
except:
A) competitors.
B) regulatory
agencies.
C) customers.
D) suppliers.
E) sales force.

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 45) Which of the B
following best
describes the
primary reason for
implementing a new
information system,
from a business
perspective?
A) The system
enables the firm to
create new products
and services.
B) The system will
create new value for
the firm, beyond its
costs.
C) The system will
automate key
business processes.
D) The system is in
use by our primary
competitors.
E) The system
integrates well with
the Web.

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 46) Which of the C
following would not
be a complementary
asset for a solar
panel manufacturer?
A) International
solar equipment
certification
standards
B) Government
funding for green
technology
C) Centralized
hierarchical decision
making
D) Innovation-driven
management team
E) Subsidies for
adoption of solar
energy

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 47) In a business D
hierarchy, which of
the following levels
is responsible for
monitoring the daily
activities of the
business?
A) Middle
management
B) Service workers
C) Production
management
D) Operational
management
E) Knowledge
workers

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 48) In ________, raw A
data is
systematically
acquired and
transformed during
various stages that
add value to that
information.
A) an information
value chain
B) the firm value
chain
C) information
processing
D) the feedback
process
E) the dissemination
process

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 49) A corporation C
that funds a political
action committee,
which in turn
promotes and funds
a political candidate
who agrees with the
values of that
corporation, could
be seen as investing
in which main
category of
complementary
assets?
A) Managerial
B) Governmental
C) Social
D) Organizational
E) Auxiliary

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 50) Which of the A
following is an
example of an
organizational
complementary
asset?
A) Using the
appropriate
business model
B) A collaborative
work environment
C) Laws and
regulations
D) The Internet and
telecommunications
infrastructure
E) Strong senior
management

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 51) Which of the A
following is an
example of a social
complementary
asset?
A) Technology and
service firms in
adjacent markets
B) Training programs
C) Distributed
decision-making
rights
D) Incentives for
management
innovation
E) A strong IS
development team

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 52) Which of the C
following roles in a
firm would be least
affected by using
mobile devices to
access firm
information
systems?
A) Senior executives
B) Sales executives
C) Production
workers
D) Operational
managers
E) Knowledge
workers

53) Which of the A

following would not
be used as an input
for an information
system?
A) Digital dashboard
B) Tablet computer
C) Bar code scanner
D) Smartphone
E) RFID reader

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 54) The three B
principal levels
within a business
organization
hierarchy are:
A) senior
management,
operational
management, and
service workers.
B) senior
management,
middle
management, and
operational
management.
C) senior
management,
operational
management, and
information systems.
D) senior
management,
middle
management, and
service workers.
E) senior
management, data
workers, and service
workers.

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 55) Personnel who C
design new
products or services
for a firm belong to
which level of a
business hierarchy?
A) Middle
management
B) Production
workers
C) Knowledge
workers
D) Data workers
E) Service workers

56) Which main B

business function is
responsible for
maintaining
employee records?
A) Sales and
marketing
B) Human resources
C) Finance and
accounting
D) Manufacturing
and production
E) Middle
management

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 57) Which of the A
following constitutes
an organizational
element in the UPS
tracking system
described in the
chapter?
A) The specification
of procedures for
identifying packages
with sender and
recipient information
B) Monitoring
service levels
C) Promoting the
company strategy of
low-cost, superior
service
D) The use of
handheld computers
and networks for
managing package
delivery
E) A web-based
Post Sales Order
Management
System

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 58) Which of the C
following constitutes
a managerial
element in the UPS
tracking system
described in the
chapter?
A) Taking inventory
B) Providing
package status
reports to
customers
C) The decision to
use automation
D) In-house
package tracking
software
E) Ability to embed
UPS functions in
external sites

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 59) Which of the C
following is a global
network that uses
universal standards
to connect millions
of different
networks around the
world?
A) An extranet
B) The World Wide
Web
C) The Internet
D) An intranet
E) Verizon

60) Which of the B

following is a
service provided by
the Internet that
uses universally
accepted standards
for storing,
retrieving,
formatting, and
displaying
information in a
page format?
A) HTML
B) The World Wide
Web
C) E-mail
D) An extranet
E) FTP

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 61) Which of the D
following is a private
corporate network
extended to
authorized users
outside the
organization?
A) An intranet
B) The World Wide
Web
C) The Internet
D) An extranet
E) FTP

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 62) Which of the E
following deals with
behavioral issues as
well as technical
issues surrounding
the development,
use, and impact of
information systems
used by managers
and employees in
the firm?
A) Information
systems literacy
B) Information
systems architecture
C) Business
processes
D) Information
technology
infrastructure
E) Management
information systems

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 63) Which field of E
study focuses on
both a behavioral
and technical
understanding of
information
systems?
A) Sociology
B) Operations
research
C) Economics
D) Behavioral
computing
E) Management
information systems

64) Information A
technology (IT)
consists of all
hardware and
software that a firm
needs to use in
order to achieve its
business objectives.
A) TRUE
B) FALSE

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 65) Computers and B
programs are the
only things required
to produce the
information an
organization needs.
A) TRUE
B) FALSE

66) Information B
systems literacy
focuses primarily on
knowledge of
information
technology.
A) TRUE
B) FALSE

67) The three main A

dimensions of
information systems
are management,
organizations, and
information
technology.
A) TRUE
B) FALSE

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 68) Knowledge B
workers make long-
range strategic
decisions about
products and
services.
A) TRUE
B) FALSE

69) There are four B

major business
functions: human
resources;
manufacturing and
production;
manufacturing and
production; finance
and accounting; and
information
technology.
A) TRUE
B) FALSE

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 70) You need to A
know something
about the hierarchy
and culture of the
company in order to
understand how a
specific business
firm uses
information systems.
A) TRUE
B) FALSE

71) All business B

processes are
formally
documented by an
organization.
A) TRUE
B) FALSE

72) Creative work A

driven by new
knowledge and
information is a
significant part of
management
responsibility.
A) TRUE
B) FALSE

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 73) Intranets link True
different systems
and networks within
a firm.

74) UPS's use of A

web-based tools
that allow customers
to embed UPS
functions such as
tracking and cost
calculations into
their own Web sites
is an information
systems solution
used to achieve
customer intimacy.
A) TRUE
B) FALSE

75) There is little B

variation in returns
on IT investment
across firms.
A) TRUE
B) FALSE

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 76) Laws and A
regulations creating
fair, stable market
environments are
examples of
complementary
social assets
required to optimize
returns from IT
investments.
A) TRUE
B) FALSE

77) A firm that A

invests in a strong IS
development team
is making an
investment in
organizational
complementary
assets.
A) TRUE
B) FALSE

78) Data is B
information that has
been shaped into a
form that is
meaningful to
human beings.
A) TRUE
B) FALSE

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 79) Feedback is A
output returned to
appropriate
members of the
organization to help
them evaluate or
correct the input
stage.
A) TRUE
B) FALSE

80) The key A

elements of an
organization are its
structure, business
processes, politics,
culture, and people.
A) TRUE
B) FALSE

81) Middle managers B

make long-range
strategic decisions
about the firm's
products and
services.
A) TRUE
B) FALSE

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 82) Detailed, A
programmed
instructions that
control computer
hardware
components in an
information system
are known as
computer software.
A) TRUE
B) FALSE

83) Define Operational excellence is the

operational achievement of higher levels of
excellence. How productivity, efficiency, and
can information profitability. Information systems
systems help can help achieve operational
achieve it? excellence by improving
Short Answer: communications to suppliers and
optimizing the supply chain.
Information systems could help
managers communicate with
workers more efficiently, enable
technological innovation in
products, minimize warehouse
overhead, and streamline
distribution.

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 84) You work for an You could create a website that
auto manufacturer allows customers to customize cars,
and distributor. How communicate with support
could you use personnel and other car owners.
information systems You could create an automated e-
to achieve greater mail service reminding car owners
customer intimacy? to take their car in for periodic
Short Answer: checkups. You could have an
information system that tracks
customer preferences in local
areas, so you can provide cars that
reflect local customer needs and
desires.

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 85) What is the Information technology (IT) consists
difference between of all the hardware and software
information that a firm needs to use to achieve
technology and its business objectives. Information
information systems are more complex. An
systems? Describe information system can be defined
some of the technically as a set of interrelated
functions of components that collect (or
information systems. retrieve), process, store, and
Short Answer: distribute information to support
decision making and control in an
organization.

An information system:

- Supports decision making,

coordination, and control.
- Helps employees analyze
problems.
- Helps employees visualize
complex subjects.
- Helps create new products.

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 86) You are a Movie ticket sales from individual
marketing manager theaters would be an example of
for a national movie raw data. Meaningful information
theater chain. Give from this would be: average
an example of data number of tickets sold to seniors on
that your certain days of the week.
department could
use for creating
meaningful
information. What
type of information
could that data
produce?
Short Answer:

87) Define business A business process is a set of

process. What might logically related tasks and
be a business behaviors for accomplishing work.
process used at a Hiring a new employee, customer
hospital? intake, and filing medical records
Short Answer: are examples of business processes
at a hospital.

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 88) This chapter Shared values at a law firm might
discusses how each be: The legal system works, the
organization has its legal system is fair, lawyers help
own culture and sets people, and people need help with
of values shared by the legal system because it is
most of its members. complicated.
What kind of shared
values might you
find at a law firm?
Short Answer:

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 89) You work at the An information value chain adds
business value to data at various stages,
headquarters for a transforming it into valuable data.
chain of movie At a chain of movie theaters, data
theaters. Describe would be gathered from ticket sales
this firm's and concession sales. Information
information value systems would help transform this
chain. into meaningful information, such as
Short Answer: determining the types of movies
popular in certain regions, times
and days of the week that people
most often saw movies, what snacks
were the most popular. This
information would be valuable in
making decisions, such as offering
ticket discounts during less popular
time slots and offering more
popular snack items. Further
feedback based on the results of
these decisions could determine
whether these decisions were
effective.

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 90) How does a A firm's ability to effectively use
company's use of information technology is
information systems interdependent with its ability to
affect its corporate implement corporate strategies and
strategies? Provide achieve corporate goals. More and
an example. more, the ability to compete and
Short Answer: succeed depends on a company's
ability to implement technology.
What a business would like to do in
the future can depends on what its
systems will be able to do.
Examples of this might be a
company who invests in information
systems that enable it to create new
products or to make its distribution
system more efficient, allowing the
company to become the low-cost
producer.

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 91) Why is the Houses are built with hammers,
building of a house nails, and wood, but these alone do
an appropriate not make a house. The architecture,
analogy for the design, setting, landscaping, and all
building of an of the decisions that lead to the
information system? creation of these features are part
Short Answer: of the house and are crucial for
solving the problem of putting a
roof over one's head. Computers
and programs are the hammer,
nails, and lumber of computer-
based information systems, but
alone they cannot produce the
information a particular
organization needs. To understand
information systems, you must
understand the problems they are
designed to solve, their
architectural and design elements,
and the organizational processes
that lead to these solutions.

92) What is the The single most important theme of

single most the book is that managers need to
important theme of consider the broader organization
the book? and management dimensions of
Short Answer: information systems to understand
current problems as well as to
derive substantial above-average
returns from information
technology investments.

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 93) What are Complementary assets are those
complementary assets required to derive value from
assets and how a primary investment. Research
does investment in indicates that firms that support
them impact returns their technology investments with
on technology investments in complementary
investments? assets, such as new business
Short Answer: models, new business processes,
management behavior,
organizational culture, or training,
receive superior returns, whereas
those firms failing to make these
complementary investments receive
less or no returns on their
information technology
investments.

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 94) Disciplines that B
contribute to the
technical approach
to information
systems include:
A) computer
science,
engineering, and
networking.
B) operations
research,
management
science, and
computer science.
C) engineering,
utilization
management, and
computer science.
D) management
science, computer
science, and
engineering.
E) economics,
sociology, and
psychology.

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 95) Which of the E
following disciplines
focuses on
mathematical
techniques for
optimizing
parameters of
organizations, such
as transportation
and inventory
control?
A) Management
science
B) MIS
C) Computer
science
D) Utilization
management
E) Operations
research

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 96) Sociologists A
study information
systems with an eye
to understanding:
A) how systems
affect individuals,
groups, and
organizations.
B) how human
decision makers
perceive and use
formal information.
C) how new
information systems
change the control
and cost structures
within the firm.
D) the production of
digital goods.
E) mathematically
based models and
physical technology.

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 97) Psychologists B
study information
systems with an eye
to understanding:
A) how systems
affect individuals,
groups, and
organizations.
B) how human
decision makers
perceive and use
formal information.
C) how new
information systems
change the control
and cost structures
within the firm.
D) the production of
digital goods.
E) mathematically
based models and
physical technology.

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 98) The behavioral A
approach to
information systems
focuses on
analyzing the
psychological,
social, and
economic impacts
of systems rather
than the technical
aspects.
A) TRUE
B) FALSE

99) Describe the Optimizing both the social and

sociotechnical view technical systems in production is
of management when optimal organizational
information systems. performance is achieved
Short Answer:

100) Which Sociologists, Psychologists, and

academic disciplines Economists
contribute to the
behavioral approach
to information
systems?
Short Answer:

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