Management Information Systems – Managing the Digital Firm, 17th Edition | Laudon & Laudon | Pearson | Complete Test Bank

Test Bank for Management Information Systems, Managing the Digital Firm, 17e Kenneth
Laudon, Jane Laudon


Management Information Systems, 17e (Laudon/Laudon)
Chapter 1 Information Systems in Global Business Today

1) Which of the following is not one of the six strategic business objectives that businesses are
seeking to achieve when they invest in information systems?
A) Operational excellence
B) Improved decision making
C) Improved community relations
D) Competitive advantage
E) Survival
Answer: C
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 Corporation uses a web-based digital dashboard to provide managers with real-time
information in order to:
A) comply with regulations.
B) improve decision making.
C) create customer intimacy.
D) improve employee morale.
E) create supplier intimacy.
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
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 uses computer systems to keep track of guests' preferences in order to:
A) Improve flexibility
B) Improve decision making
C) Increase efficiency
D) Enhance customer intimacy
E) Achieve 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) All of the following are examples of challenges that required companies to create information
systems as a necessity of doing business except:
A) Walmart's development of Retail Link.
B) Citibank's development of an ATM network.
C) the passage of the Toxic Substances Control Act.
D) the passage of the Sarbanes-Oxley Act.
E) the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Answer: A
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?

,7) As discussed in the chapter-opening case, AWM Smart Shelf can help brands and retailers
achieve which of the following?
A) Increased customer intimacy
B) Survival
C) Improved employee morale
D) Development of new products
E) Increased supplier intimacy
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 improve
supplier intimacy?
A) Citibank's ATM system
B) The Mandarin Oriental's use of computers to keep track of guest preferences
C) Verizon Corporation's use of a web-based digital dashboard to provide real-time information
for managers
D) Apple's creation of the iPad
E) JCPenney's information system that allows its contract manufacturers to see what garments
have been sold and need to be replaced
Answer: E
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) The development of 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?

, 10) In each of the years between 1999 and 2019, capital investment in information technology,
consisting of IT equipment, software, and research and development (R&D), accounted for over
________ percent of U.S. total capital spending (in nominal GDP).
A) 40
B) 50
C) 55
D) 65
E) 70
Answer: A
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 it stocks clothes that its customers will purchase, a department store
implements a new application that analyzes spending levels at its 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) New business models
D) Supplier intimacy
E) New services
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?

12) Approximately how much revenue was generated by e-commerce sales worldwide in 2019?
A) About $3.6 billion
B) About $36 billion
C) About $360 billion
D) About $3.6 trillion
E) About $36 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?