WGU C724 INFORMATION SYSTEMS
MANAGEMENT EXAM|2026 UPDATE|100%
PASS|QUESTIONS AND ANSWERS WITH
RATIONALE
Question 1
A logistics company wants to reduce fuel costs by optimizing delivery routes in
realtime based on traffic data. This requires integrating GPS hardware, routing
software, and the expertise of their dispatchers.
Which of the following best describes this integration?
A. Information Technology (IT)
B. An Information System (IS)
C. A Database Management System (DBMS)
D. A Network Protocol
Correct Answer: B. An Information System (IS)
Rationale: An Information System is the combination of technology
(hardware/software), data, people (dispatchers), and processes (route
optimization) used to achieve a goal. IT refers only to the hardware and software
components.
Question 2
,A hospital implements a new system that allows doctors to access patient history,
lab results, and prescribed medications from a single dashboard. What type of
information system is this?
A. Decision Support System (DSS)
B. Transaction Processing System (TPS)
C. Executive Information System (EIS)
D. Management Information System (MIS)
Correct Answer: D. Management Information System (MIS)
Rationale: MIS serves middle management by providing reports and access to the
organization's current performance and historical data. A DSS supports complex
decisionmaking, while a TPS handles routine transactions.
Question 3
A CEO uses a dashboard that displays key performance indicators (KPIs) like
market share, stock trends, and competitor analysis in a highly summarized
format.
What type of system is the CEO using?
A. Decision Support System (DSS)
B. Transaction Processing System (TPS)
C. Executive Information System (EIS)
D. Expert System (ES)
,Correct Answer: C. Executive Information System (EIS)
Rationale: EIS (also called Executive Support System) is designed for senior
executives to support strategic decisionmaking. It aggregates data from internal
and external sources into a easytoread format.
Question 4
According to Porter's Five Forces, which force is strengthened when a buyer can
easily switch to a competitor's product without incurring significant cost?
A. Threat of New Entrants
B. Bargaining Power of Buyers
C. Bargaining Power of Suppliers
D. Rivalry Among Existing Competitors
Correct Answer: B. Bargaining Power of Buyers
Rationale: When switching costs are low, buyers have more leverage to demand
lower prices or higher quality, increasing their bargaining power.
Question 5
A company uses its own proprietary software to manage inventory, which gives it
a unique cost advantage that competitors cannot easily replicate.
In the context of Porter's Five Forces, how does this help the company?
, A. It increases the threat of substitutes.
B. It increases the bargaining power of suppliers.
C. It creates a barrier to entry for new competitors.
D. It reduces the intensity of rivalry.
Correct Answer: C. It creates a barrier to entry for new competitors.
Rationale: Unique technology or proprietary knowledge makes it difficult for new
firms to enter the market and compete effectively, thus raising the barrier to entry.
Question 6
A smartphone manufacturer relies on a single supplier for a specialized microchip.
If that supplier raises prices significantly, the manufacturer has no alternative.
This scenario highlights which of Porter's Five Forces?
A. Threat of New Entrants
B. Bargaining Power of Buyers
C. Bargaining Power of Suppliers
D. Threat of Substitute Products
Correct Answer: C. Bargaining Power of Suppliers
Rationale: When a company is dependent on a single supplier (or few suppliers),
the supplier has high bargaining power to dictate terms, prices, and availability.
MANAGEMENT EXAM|2026 UPDATE|100%
PASS|QUESTIONS AND ANSWERS WITH
RATIONALE
Question 1
A logistics company wants to reduce fuel costs by optimizing delivery routes in
realtime based on traffic data. This requires integrating GPS hardware, routing
software, and the expertise of their dispatchers.
Which of the following best describes this integration?
A. Information Technology (IT)
B. An Information System (IS)
C. A Database Management System (DBMS)
D. A Network Protocol
Correct Answer: B. An Information System (IS)
Rationale: An Information System is the combination of technology
(hardware/software), data, people (dispatchers), and processes (route
optimization) used to achieve a goal. IT refers only to the hardware and software
components.
Question 2
,A hospital implements a new system that allows doctors to access patient history,
lab results, and prescribed medications from a single dashboard. What type of
information system is this?
A. Decision Support System (DSS)
B. Transaction Processing System (TPS)
C. Executive Information System (EIS)
D. Management Information System (MIS)
Correct Answer: D. Management Information System (MIS)
Rationale: MIS serves middle management by providing reports and access to the
organization's current performance and historical data. A DSS supports complex
decisionmaking, while a TPS handles routine transactions.
Question 3
A CEO uses a dashboard that displays key performance indicators (KPIs) like
market share, stock trends, and competitor analysis in a highly summarized
format.
What type of system is the CEO using?
A. Decision Support System (DSS)
B. Transaction Processing System (TPS)
C. Executive Information System (EIS)
D. Expert System (ES)
,Correct Answer: C. Executive Information System (EIS)
Rationale: EIS (also called Executive Support System) is designed for senior
executives to support strategic decisionmaking. It aggregates data from internal
and external sources into a easytoread format.
Question 4
According to Porter's Five Forces, which force is strengthened when a buyer can
easily switch to a competitor's product without incurring significant cost?
A. Threat of New Entrants
B. Bargaining Power of Buyers
C. Bargaining Power of Suppliers
D. Rivalry Among Existing Competitors
Correct Answer: B. Bargaining Power of Buyers
Rationale: When switching costs are low, buyers have more leverage to demand
lower prices or higher quality, increasing their bargaining power.
Question 5
A company uses its own proprietary software to manage inventory, which gives it
a unique cost advantage that competitors cannot easily replicate.
In the context of Porter's Five Forces, how does this help the company?
, A. It increases the threat of substitutes.
B. It increases the bargaining power of suppliers.
C. It creates a barrier to entry for new competitors.
D. It reduces the intensity of rivalry.
Correct Answer: C. It creates a barrier to entry for new competitors.
Rationale: Unique technology or proprietary knowledge makes it difficult for new
firms to enter the market and compete effectively, thus raising the barrier to entry.
Question 6
A smartphone manufacturer relies on a single supplier for a specialized microchip.
If that supplier raises prices significantly, the manufacturer has no alternative.
This scenario highlights which of Porter's Five Forces?
A. Threat of New Entrants
B. Bargaining Power of Buyers
C. Bargaining Power of Suppliers
D. Threat of Substitute Products
Correct Answer: C. Bargaining Power of Suppliers
Rationale: When a company is dependent on a single supplier (or few suppliers),
the supplier has high bargaining power to dictate terms, prices, and availability.
