Homework 2

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1. The costs incurred when a firm buys on the marketplace what it cannot make itself are referred to as (Points : 1)

      [pic] switching costs.
      [pic] transaction costs.
      [pic] procurement.
      [pic] agency costs.

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2. Disintermediation (Points : 1)

      [pic] results from the speed of the Internet.
      [pic] is defined as the elimination of layers in the distribution process.       [pic] is a result of social networking.
      [pic] All of the above

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3. The four major types of competitive strategy are: (Points : 1)

      [pic] low-cost leadership; substitute products and services; customers; and suppliers.       [pic] low-cost leadership; product differentiation; focus on market niche; and customer and supplier intimacy.       [pic] new market entrants; substitute products and services; customers; and suppliers.       [pic] low-cost leadership; new market entrants; product differentiation; and focus on market niche.

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4. Information asymmetry exists when (Points : 1)

      [pic] the network is overloaded.
      [pic] sellers and buyers have the same information.       [pic] one party in a transaction has more important information than the other.       [pic] manufactures provide online data to customers.

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5. When a firm provides a specialized product or service for a narrow target market better than competitors, they are using a (Points : 1)

      [pic] product differentiation strategy.
      [pic] market niche strategy.
      [pic] mass customization strategy.
      [pic] process efficiency strategy.

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6. Internet technology (Points : 1)

      [pic] makes it easy for rivals to compete on price alone.       [pic] imposes a significant cost of entry, due to infrastructure requirements.       [pic] increases the difference between competitors because of the wide availability of information.       [pic] makes it easy to sustain operational advantages.

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7. The Internet raises the bargaining power of customers by (Points : 1)

      [pic] creating new opportunities for building loyal customer bases.       [pic] making more products available.
      [pic] making information available to everyone.
      [pic] lowering transaction costs.

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8. Cloud computing (Points : 1)

      [pic] is the same as e-commerce.
      [pic] reduces the size of IT organizations.
      [pic] increases business costs.
      [pic] requires special software, other than a browser, to be installed on each computer.

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9. Benchmarking (Points : 1)

      [pic] compares the efficiency and effectiveness of your business processes against strict standards.       [pic] allows industry participants to influence industry-wide standards.       [pic] is used to measure the speed and responsiveness of information technology.       [pic] synchronizes the business processes of customers, suppliers, and trading partners.

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10. The most successful solutions or methods for achieving a business objective are called (Points : 1)

      [pic] value activities.
      [pic] best processes.
      [pic] core competencies.
      [pic] best practices.

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11. An information system can enhance core competencies by (Points : 1)

      [pic] providing better reporting facilities.
      [pic] creating educational opportunities for management.       [pic] allowing operational employees to interact with management.       [pic] encouraging the sharing of knowledge across business units.

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12. The more any given resource is applied to production, the lower the marginal gain in output, until a point is reached at which the additional inputs...
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