Test Bank for: Management Information Systems:
Managing the Digital Firm, 16th Edition By Kenneth C.
Laudon, Jane P. Laudon.
Management Information Systems: Managing the Digital Firm, 15e (Laudon)
Chapter 1 Information Systems in Global Business Today
1) Which of the 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
Answer: D
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
2) Verizon's use of a 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
Answer: B
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
3) Which of the 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
Answer: E
Difficulty: Challenging
1
,AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
4) A firm that invests 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
Answer: E
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
5) The Mandarin 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
6) Competitors were 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
Answer: C
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
2
,7) Which of the 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
Answer: A
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
8) Which of the 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
Answer: D
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
9) Walmart 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
Answer: B
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
3
, 10) How much did 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
11) To make sure they 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
Answer: C
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
12) Approximately 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
4
Managing the Digital Firm, 16th Edition By Kenneth C.
Laudon, Jane P. Laudon.
Management Information Systems: Managing the Digital Firm, 15e (Laudon)
Chapter 1 Information Systems in Global Business Today
1) Which of the 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
Answer: D
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
2) Verizon's use of a 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
Answer: B
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
3) Which of the 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
Answer: E
Difficulty: Challenging
1
,AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
4) A firm that invests 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
Answer: E
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
5) The Mandarin 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
6) Competitors were 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
Answer: C
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
2
,7) Which of the 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
Answer: A
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
8) Which of the 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
Answer: D
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
9) Walmart 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
Answer: B
Difficulty: Challenging
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
3
, 10) How much did 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
11) To make sure they 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
Answer: C
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
12) Approximately 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
Answer: D
Difficulty: Moderate
AACSB: Information technology
LO: 1-1: How are information systems transforming business, and why are they so essential for
running and managing a business today?
4
