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Indicate whether the statement is true or false.
1. Low scalability implies that serving additional customers requires low incremental variable costs.
a. True
b. False
2. Scalability is a key issue in e-commerce.
a. True
b. False
3. The use of technology has increased opportunities for employee creativity and empowerment.
a. True
b. False
Indicate the answer choice that best completes the statement or answers the question.
4. A(n) _____ is an example of soft technology.
a. database system
b. bar-code scanner
c. image sensor
d. radio-frequency identification tag
5. Which of the following is true of radio-frequency identification (RFID) tags?
a. They can bring visibility and enhanced security to the handling and transportation of products.
b. They are used to segment markets based on demographic and behavioral characteristics.
c. They are used to create customized goods and services and deliver them faster at lower prices.
d. They can help small companies create counterfeit knock-offs of genuine products.
6. _____ can be attached to objects and used to track and manage inventory and assets.
a. Proximity cards
b. Nanofountain probes
c. Resistance-temperature detectors
d. Radio-frequency identification tags
7. In the context of technology in value chains, customer relationship management (CRM):
a. enables small firms to make counterfeit knock-offs of genuine products.
b. prohibits firms from bundling goods and services together.
c. encourages firms to produce standardized goods for all consumers to reduce manufacturing costs.
d. exploits the vast amount of data that can be collected from consumers.
8. _____ are the modern successor to bar codes.
a. Optical switches
b. Artificial intelligence programs
c. Electro-optical sensors
d. Radio-frequency identification tags
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9. _____ refers to equipment and devices that perform a variety of tasks in the creation and delivery of goods and services.
a. Hard technology
b. Soft technology
c. A database system
d. A neural network
10. Customer relationship management (CRM) helps firms gain and maintain competitive advantage by:
a. encouraging them to produce standardized goods.
b. merging all demographic-based and behavior-based segments of markets.
c. studying which goods and services are purchased together.
d. prohibiting them from bundling goods and services together.
11. Which of the following is a benefit of using technology?
a. It increases the number of human service providers in firms.
b. It increases quality and productivity of firms.
c. It increases opportunities for employee empowerment.
d. It makes it easy for customers to change decisions and return goods.
12. Valuetronics, an electronics company, is currently in the preproduction stage of launching one of its new stereo
systems. In order to analyze the feasibility of the product, Valuetronics adopts an integrated system that allows it to
manufacture the product before it physically exists, that is, the system allows Valuetronics to finalize the design of the
stereo, analyze it, and do a test-run. In this context, Valuetronics is using a(n) _____.
a. enterprise resource planning (ERP) system
b. flexible manufacturing system (FMS)
c. computer-aided engineering (CAE) system
d. computer-aided manufacturing (CAM) system
13. _____ are tiny computer chips that can be placed on shipping containers, individual products, credit cards, prescription
medicines, passports, livestock, and even people.
a. Bar codes
b. Radio-frequency identification tags
c. Thermocouples
d. Voice-recognition modules
14. _____ is a measure of the contribution margin required to deliver a good or service as the business grows and volumes
increase.
a. Scalability
b. Process capability
c. Sustainability
d. Operability
15. Which of the following is a challenge of adopting technology?
a. Technology leads to job shift and displacement.
b. The use of technology reduces product quality.
c. Technology deteriorates the standard of living of the world.
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16. We Create Inc. is an electronics company. It designs, produces, and assembles desktop gadgets. The entire process is
controlled by programmable robots, which are in turn linked to computers. These computers direct the robots to the
appropriate task. In this context, We Create Inc. uses a(n) _____ system to produce its goods.
a. partner relationship management
b. enterprise resource planning
c. employee experience management
d. flexible manufacturing
17. _____ consist of two or more computer-controlled machines or robots linked by automated handling devices such as
transfer machines, conveyors, and transport systems.
a. Computer-aided engineering (CAE) systems
b. Computer-aided design (CAD) systems
c. Enterprise planning systems (EPSs)
d. Flexible manufacturing systems (FMSs)
18. Identify a benefit of adopting technology.
a. Technology helps restructure old and less productive industries.
b. The use of technology increases opportunities for employee empowerment.
c. Technology increases opportunities for employee creativity.
d. The use of technology does not require adherence to any laws or regulations.
19. _____ machine tools enable the machinist’s skills to be duplicated by a programmable device that controls the
movements of a tool used to make complex shapes.
a. Virtual control (VC)
b. Numerical control (NC)
c. Revision control (RC)
d. Movement control (MC)
20. Which of the following is true of customer relationship management (CRM)?
a. A typical CRM system includes market segmentation and analysis.
b. It helps firms gain competitive advantage by making counterfeit knock-offs of genuine products.
c. It encourages the production of standardized goods for all customers to reduce manufacturing costs.
d. A CRM system prohibits firms from bundling goods and services together.
21. _____ technology refers to the application of the Internet, computer programs, and information systems to provide
data, information, and analysis to facilitate the creation and delivery of goods and services.
a. Hard
b. Soft
c. Assistive
d. Adaptive
22. Which of the following is a difference between firms that have high scalability and firms that have low scalability?
a. Firms with high scalability incur extremely low fixed costs, whereas firms with low scalability incur extremely
high fixed costs.
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b. Firms with high scalability have variable costs as 80 to 85 percent of total costs, whereas firms with low
scalability have variable costs as zero to five percent of total costs.
c. Firms with high scalability serve additional customers at extremely low incremental costs, whereas firms with low
scalability serve additional customers at high incremental variable costs.
d. Firms with high scalability have a low contribution margin, whereas firms with low scalability have a high
contribution margin.
23. _____ refers to using the Internet and technology to provide facilities that create and deliver time, place, information,
entertainment, and exchange value to customers and support the sale of goods.
a. Outsourcing
b. Offshoring
c. E-service
d. E-readiness
24. The fixed costs of WeBuy&Sell.com, an e-commerce website, make up about 90 percent of the total costs incurred by
the company. However, since its primary means of communication is web advertising, WeBuy&Sell.com has variable
costs as low as 10 percent of its total costs. This allows WeBuy&Sell.com to earn high profits at a very low cost.
According to the given scenario, WeBuy&Sell.com has _____ scalability.
a. zero
b. low
c. infinite
d. high
25. _____ allows all parts of the value chain to immediately recognize and react to changes in demand and supply.
a. Super-precision manufacturing
b. Rapid prototyping
c. Descriptive analytics
d. Electronic transaction capability
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Answer Key
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chapter 4