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Package Title: Testbank Questions
Course Title: IS 5e
Chapter Number: 7
Question Type: True/False
1. In traditional commerce, one or more of the following can be digital: the product or service, the
process, and the delivery agent.
2. Visiting the Web site of a car manufacturer (e.g., www.gm.com), entering the specifications for the
car you want, and then picking up your car at your local dealership is an example of partial electronic
commerce.
3. eBay is a good example of business-to-consumer electronic commerce.
4. Forward auctions are auctions that sellers use as a channel to many potential buyers.
5. Even though B2C EC is much larger by volume, B2B is more complex.
6. An electronic storefront is a Web site on the Internet that represents a single store.
7. You can make a purchase in a referral mall.
8. Selling products such as books and computers on the Internet may reduce vendors’ selling costs by
20 to 40 percent, with further reductions being difficult because the products must be delivered
physically.
9. Virtual banks are those banks that are dedicated only to Internet trAnsweractions.
10. Channel conflict occurs when click-and-mortar companies have problems with their regular
distributors when they sell directly to customers online.
11. Internet advertising is impersonal, one-way mass communication.
12. Banners are the most common form of advertisement on the Internet.
13. Hacking is the indiscriminate distribution of electronic ads without permission of the receiver.
14. Business-to-consumer applications comprise the majority of electronic commerce volume.
15. The key mechanisms in the sell-side marketplace are customized electronic catalogs and reverse
auctions.
16. The buy-side marketplace is similar to the business-to-consumer model.
17. Horizontal exchanges connect buyers and sellers across many industries.
18. In most cases, traditional payment systems are not effective for electronic commerce.
19. Smart cards can be used as credit cards, debit cards, and/or loyalty cards.
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20. Each buyer needs only one e-wallet for all merchants.
21. E-commerce affects only businesses that sell products online.
22. Refer to IT’s About Business 7.1: Gemvara is an example of pure e-Commerce.
23. Refer to IT’s About Business 7.1: Selling luxury items online is as easy as selling books and DVDs.
24. Refer to IT’s About Business 7.4: Showrooming occurs when customers prefer to physically handle
the products before purchasing them from the same store.
25. Refer to IT’s About Business 7.5: eBay’s updates to its business model involved the development
of new technologies.
Question Type: Multiple Choice
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26. Which of the following is not an effect that E-commerce has had on organizations?
A. E-commerce enables smaller businesses to operate in areas dominated by larger companies.
B. E-commerce increases the number of potential customers to whom the company can market its
products.
C. E-commerce is a costly medium for increasing market share.
D. E-commerce removes many barriers for start-up businesses.
E. E-commerce makes it easy to reach customers around the world.
27. _____, which is a broader concept than _____, is the buying and selling of goods and services, as
well as servicing customers, collaborating with business partners, and performing transactions within an
organization.
A. Business-to-business electronic commerce, business-to-customer electronic commerce
B. Electronic commerce, electronic business
C. Business-to-customer electronic commerce, business-to-business electronic commerce
D. Business-to-business electronic commerce, intrabusiness electronic commerce
E. Electronic business, electronic commerce
28. The degree of digitization relates to all of the following except:
A. the product or service sold
B. the process by which the product is produced
C. the delivery agent or intermediary
D. the size of e-commerce transactions
E. none of the above
29. In _______ e-commerce, the sellers and buyers are organizations.
A. government-to-citizen
B. consumer-to-consumer
C. business-to-business
D. business-to-consumer
E. consumer-to-business
30. In ________ e-commerce, an organization provides information and services to its workers.
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A. business-to-employee
B. consumer-to-consumer
C. consumer-to-business
D. business-to-consumer
E. government-to-business
31. Direct payment of Social Security benefits is an example of ______ e-commerce.
A. government-to-citizen
B. consumer-to-consumer
C. consumer-to-business
D. business-to-consumer
E. business-to-business
32. If you are an worker managing your fringe benefits over your company’s intranet, you are engaging
in _________ e-commerce.
A. business-to-business
B. business-to-consumer
C. consumer-to-consumer
D. business-to-employee
E. government-to-citizen
33. Which of the following statements regarding the relationship between electronic commerce and
search is not correct?
A. Purchases often follow successful online searches.
B. Shopping carts are often abandoned after unsuccessful online searches.
C. Retailers will provide fewer product details to avoid information overload for customers.
D. Customers will be able to find the closest store offering the product that they want.
E. Customers will have more relevant product information in the near future.
34. In _____ auctions, there is one buyer who wants to buy a product. Suppliers submit bids, and the
lowest bid wins.
A. forward
B. static
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C. reverse
D. physical
E. simple
35. eBay uses a _____ auction.
A. forward
B. static
C. reverse
D. physical
E. simple
36. _____ auctions employ a request for quotation.
A. Forward
B. Static
C. Reverse
D. Physical
E. Simple
37. _____ auctions are the most common auction model for large purchases.
A. Forward
B. Static
C. Reverse
D. Physical
E. Simple
38. In which of the following business models do businesses request quotes from suppliers and use
B2B with a reverse auction mechanism?
A. find-the-best-price
B. electronic tendering system
C. name-your-own-price
D. online direct marketing
E. affiliate marketing
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39. A vendor asks its business partners to place logos or banners on their Web sites. If customers click
on a logo, visit the vendor’s site, and make a purchase, then the vendor pays a commission to the
partner. This scenario illustrates which business model?
A. find-the-best-price
B. electronic tendering system
C. name-your-own-price
D. online direct marketing
E. affiliate marketing
40. Which type of electronic commerce is the largest by volume?
A. business-to-employee
B. consumer-to-consumer
C. business-to-business
D. business-to-consumer
E. none of the above
41. Which type of electronic commerce does Amazon practice?
A. business-to-employee
B. consumer-to-consumer
C. consumer- to-business
D. business-to-consumer
E. employee-to-business
42. _______ e-commerce is also known as e-tailing.
A. Business-to-business
B. Collaborative commerce
C. Intrabusiness
D. Business-to-consumer
E. Consumer-to-business
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43. The advantages of electronic commerce for consumers include all of the following except:
A. You can buy from home 24 hours per day, 7 days per week.
B. You have a wider variety of products to choose from.
C. You typically cannot access additional information, so you do not have information overload.
D. You can easily compare prices and features.
E. You can find unique items.
44. Which of the following is not an electronic commerce application?
A. home banking
B. buying stocks
C. evaluating an employee
D. conducting an auction
E. buying real estate
45. Which of the following is not an advantage of e-tailing?
A. You can buy from home, 24 hours per day.
B. You have only a few products to choose from.
C. You can obtain detailed information on products.
D. You can compare competitors’ products and prices.
E. All of the above
46. ________ is the process whereby a fully automated electronic commerce transaction eliminates
middlemen.
A. Disintegration
B. Supply chain integration
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C. Direct sales
D. Disintermediation
E. Value-added services
47. Cyberbanking offers all of the following advantages except:
A. It is convenient for customers.
B. It saves time for customers.
C. It includes inexpensive transactions for the bank.
D. It can help recruit remote customers.
E. It is more expensive for the customer.
48. Which of the following is a problem that e-commerce can cause for the airline industry?
A. Too many fares
B. Mistakes in fares
C. Too few fares
D. No fares offered on certain routes
E. Too many fares offered on certain routes
49. Refer to IT’s About Business 7.2: The service offered by ZocDoc is
A. Digital
B. Physical
C. Both
D. Neither
50. In IT’s About Business 7.3: Macy has involved external companies to perform the following service
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A. Increase traffic to the Macy’s website
B. Track Macy’s website traffic
C. Analyze Macy’s website performance
D. Create a mobile version on Macy’s website
E. Track customer details on Macy’s website
51. Difficulties in order fulfillment are most closely associated with which type of electronic commerce?
A. business-to-business
B. business-to-consumer
C. government-to-citizen
D. business-to-employee
E. mobile commerce
52. Internet advertising improves on traditional advertising in all of the following ways except:
A. Internet ads can be updated at any time at minimal cost.
B. Internet ads can reach large numbers of potential buyers all over the world.
C. Internet ads are always more effective than other types of advertising.
D. Internet ads can make effective use of multimedia.
E. Internet ads are current.
53. A _____ is automatically launched by some trigger and appears behind the active window.
A. keyword banner
B. random banner
C. pop-up ad
D. pop-under ad
E. text box
54. _____ offer(s) consumers incentives to accept advertising and e-mail voluntarily.
A. Viral marketing
B. Personalized marketing
C. Permission marketing
D. Paper catalogs
E. Direct mail
55. _____ refers to online word-of-mouth marketing.
A. Permission marketing
B. One-to-one marketing
C. Personalized marketing
D. Viral marketing
E. Direct mail
56. In the _____ marketplace model, organizations attempt to sell their products or services to other
organizations electronically.
A. buy-side
B. sell-side
C. group purchasing
D. desktop purchasing
E. electronic exchange
57. The key mechanisms of the _____ marketplace model are forward auctions and electronic catalogs
that can be customized for each large buyer.
A. buy-side
B. sell-side
C. group purchasing
D. desktop purchasing
E. electronic exchange
58. In the _____ marketplace model, EC technology is used to streamline the purchasing process in
order to reduce the cost of items purchased, the administrative cost of procurement, and the
purchasing cycle time.
A. buy-side
B. sell-side
C. auctions
D. group purchasing
E. electronic exchange
59. In the _____ B2B application, the orders of many buyers are aggregated so that they comprise a
large volume, in order to merit more seller attention.
A. buy-side
B. sell-side
C. auctions
D. group purchasing
E. electronic exchange
60. In _____, direct and indirect materials in one industry are purchased on an as-needed basis.
A. horizontal exchanges
B. vertical exchanges
C. buy-side marketplaces
D. functional exchanges
E. sell-side marketplaces
61. _____ connect buyers and sellers across many industries and are used mainly for indirect
materials.
A. Horizontal exchanges
B. Vertical exchanges
C. Buy-side marketplaces
D. Functional exchanges
E. Sell-side marketplaces
62. All of the following are limitations of traditional payment methods in electronic commerce except:
A. Cash cannot be used because there is no face-to-face contact.
B. Paying for goods and services via the mail takes more time.
C. Not all organizations accept credit cards.
D. It is more secure for the buyer to use the telephone than to complete a secure transaction on a
computer.
E. None of the above
63. _____ are a payment mechanism that are similar to regular bank checks but are transmitted
electronically, with a signature in digital form.
A. Electronic checks
B. Electronic credit cards
C. Electronic cash transactions
D. Electronic wallets
E. Electronic debit cards
64. _____ use credit card numbers, transmitted electronically over the Internet, to pay for goods and
services. They are either unencrypted or encrypted, with coded data readable by an intermediary
between the buyer’s and seller’s banks.
A. Electronic checks
B. Electronic credit cards
C. Electronic cash transactions
D. Electronic wallets
E. Electronic debit cards
65. ______ are a form of e-cash that enable you to store a fixed amount of prepaid money and then
spend it as necessary.
A. Electronic checks
B. Stored-value money cards
C. Purchasing cards
D. Smart cards
E. Person-to-person payments
66. _____ contain a chip that can store information and be used for several purposes.
A. Electronic checks
B. Stored-value money cards
C. Purchasing cards
D. Smart cards
E. Person-to-person payments
67. _____ enable two individuals to transfer funds without using a credit card.
A. Electronic checks
B. Stored-value money cards
C. Purchasing cards
D. Smart cards
E. Person-to-person payments
68. The practice of using similar but not identical domain names is called _____.
A. domain spoofing
B. domain masquerading
C. domain tasting
D. cybersquatting
E. domain fraud
69. _____ refers to the practice of registering or using domain names for the purpose of profiting from
the goodwill or trademark belonging to someone else.
A. Domain spoofing
B. Domain masquerading
C. Domain tasting
D. Cybersquatting
E. Domain fraud
70. Which of the following statements about eBureau is true:
A. eBureau is used by eCommerce websites
B. eBureau does not violate any privacy laws
C. eBureau gets permission from consumers
D. eBureau creates ranks and scores consumers
E. eBureau only uses publicly available information
71. Companies use Web sites for all of the following reasons except:
A. To reduce operational and transaction costs.
B. To enhance their reputation.
C. To sell goods and services.
D. To reduce the amount of actual cash they need to deal with.
E. To induce people to visit a physical location.
72. Differentiate between pure and partial electronic commerce. Provide examples of companies in
each category.
73. Discuss the various types of electronic commerce.
74. Differentiate between forward and reverse auctions.
75. Differentiate among sell-side marketplaces, buy-side marketplaces, and electronic exchanges.
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76. Differentiate between electronic storefronts and electronic malls, and provide examples of each.
77. Discuss the reasons for E-commerce failures.
78. Discuss the benefits and limitations of electronic commerce.
79. Discuss the various business-to-consumer applications (e.g., e-tailing, electronic storefronts,
electronic malls).
80. Discuss the various methods of online advertising.
81. Discuss the following electronic commerce business models and give examples of each type: online
direct marketing, electronic tendering system, name-your-own-price, find-the-best-price, affiliate
marketing, and viral marketing.
82. Describe the various types of electronic payments.
83. What is domain tasting? Should it be made illegal?
Question Type: True/False
84. You decide to start a landscaping business called Trim Grass. You type www.TrimGrass.com in a
Web browser, and no page with that name appears. The domain name is therefore available.
85. You decide to start a landscaping business called Trim Grass. One of your services will be to
perform fertilizer treatments. You will need to buy a great deal of fertilizer for your many clients. You
can use all of the following methods to purchase the fertilizer except:
A. Forward auction
B. Reverse auction
C. Name your Own Price
D. Electronic Marketplace
E. Multichanneling
86. You decide to start a landscaping business called Trim Grass. You created a Web site, but it
doesn’t seem to be attracting any clients. So, you decide to explore advertising on the Web. Which of
the following advertising methods probably would not be beneficial?
A. Banner ads
B. Pop-up or pop-under ads
C. Spamming
D. Permission marketing
E. Viral marketing
87. You decide to start a landscaping business called Trim Grass. Some of your residential clients
would like to pay their bills online. Which of the following methods will not be appropriate for this type of
payment?
A. Electronic checks
B. Electronic credit cards
C. Purchasing cards
D. Person-to-person payments
E. Stored–value money cards
88. You decide to start a landscaping business called Trim Grass. You expect to use the Web to help
clients find you and communicate with you. You will mow lands, clean flower beds, and pick up leaves
in the fall. You will send your clients monthly bills. Which of the following is true?
A. Trim Grass is using an e-commerce model.
B. Trim Grass is using an e-business model.
C. Trim Grass is using a forward auction.
D. Trim Grass is an electronic marketplace.
E. Trim Grass needs to worry about channel conflict.
89. You have been running a landscaping business called Trim Grass for about two years. You have
developed a special blend of grass seed for your area that you use when you reseed your clients’
lawns. You are receiving e-mails via your Web site from people who would like to purchase some. You
decide to start selling seed online, and you hire someone to rebuild your Web site. Which of the
following statements is not true?
A. Trim Grass is now multichanneling.
B. Trim Grass needs to think about how to ship the seed.
C. Trim Grass will have to collect sales tax from all sales.
D. Trim Grass will have more expenses.
E. Trim Grass will need to consider different advertising methods.
