Management Information Systems: Managing the Digital Firm, 18e (Laudon)
Chapter 1 Information Systems in Global Business Today
1) As discussed in the chapter-opening case, ConocoPhillips solved the problem of supply chain
challenges by using which technology?
A) 3D printing
B) cloud computing
C) 5G networks
D) Intranet
Answer: A
Page Ref: 5
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1.1: Understand how information systems transform business and careers.
2) Approximately how many people in 2024 are expected to purchase something online?
A) About 1 billion
B) About 2.9 billion
C) About 3.5 billion
D) About 4.25 billion
Answer: B
Page Ref: 10
Difficulty: Moderate
AACSB: Information technology
LO: 1.1: Understand how information systems transform business and careers.
3) All of the following describe the effects of globalization except ________.
A) significant decreases in operating costs
B) ability to reliably obtain price and quality information worldwide
C) increased ability to find low-cost suppliers
D) increases in transaction costs
Answer: D
Page Ref: 17
Difficulty: Difficult
AACSB: Analytical thinking
LO: 1.2: Describe key challenges and opportunities created by new MIS technologies.
1
Copyright © 2026 Pearson Education, Inc.
,4) Between 1998 and 2021, the United States lost ________ manufacturing jobs to offshore
producers.
A) 3 million
B) 4 million
C) 5 million
D) 6 million
Answer: C
Page Ref: 19
Difficulty: Difficult
AACSB: Application of knowledge
LO: 1.2: Describe key challenges and opportunities created by new MIS technologies.
5) Which of the following statements about digital firms is not true?
A) In digital firms, time shifting and space shifting are the norm.
B) Today, most firms are fully digital.
C) Digital firms offer extraordinary opportunities for flexible global organization and
management.
D) Digital firms sense and respond to their environments more rapidly than traditional firms.
Answer: B
Page Ref: 19
Difficulty: Difficult
AACSB: Information technology
LO: 1.3: Describe key features of a digital firm.
6) Creating a marketing plan is an example of a business process.
Answer: TRUE
Page Ref: 20
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.3: Describe key features of a digital firm.
7) In order to be considered a digital firm, all of the firm's significant business relationships and
core business processes must be digitally enabled.
Answer: FALSE
Page Ref: 19
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.3: Describe key features of a digital firm.
2
Copyright © 2026 Pearson Education, Inc.
,8) Define business process. What might be a business process used at a hospital?
Answer: A business process is a set of logically related tasks and behaviors that organizations
develop over time to produce specific business results and the unique manner in which these
activities are organized and coordinated. Hiring a new employee, customer intake, and filing
medical records are examples of business processes at a hospital.
Page Ref: 20
Difficulty: Moderate
AACSB: Analytical thinking; Written and oral communication
LO: 1.3: Describe key features of a digital firm.
9) 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
Answer: C
Page Ref: 23
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
10) 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
Answer: A
Page Ref: 27
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
11) Which of the following companies is given as an example of a business using information
systems to improve supplier intimacy?
A) Citibank
B) Mandarin Oriental
C) Ritz-Carlton
D) Apple
Answer: C
Page Ref: 25
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
3
Copyright © 2026 Pearson Education, Inc.
, 12) 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
Answer: B
Page Ref: 24
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
13) 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
Answer: A
Page Ref: 25
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1.4: Describe the business objectives of information systems.
14) A business model describes how a company produces, delivers, and sells a product or service
to generate revenue.
Answer: TRUE
Page Ref: 24
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.4: Describe the business objectives of information systems.
4
Copyright © 2026 Pearson Education, Inc.
Chapter 1 Information Systems in Global Business Today
1) As discussed in the chapter-opening case, ConocoPhillips solved the problem of supply chain
challenges by using which technology?
A) 3D printing
B) cloud computing
C) 5G networks
D) Intranet
Answer: A
Page Ref: 5
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1.1: Understand how information systems transform business and careers.
2) Approximately how many people in 2024 are expected to purchase something online?
A) About 1 billion
B) About 2.9 billion
C) About 3.5 billion
D) About 4.25 billion
Answer: B
Page Ref: 10
Difficulty: Moderate
AACSB: Information technology
LO: 1.1: Understand how information systems transform business and careers.
3) All of the following describe the effects of globalization except ________.
A) significant decreases in operating costs
B) ability to reliably obtain price and quality information worldwide
C) increased ability to find low-cost suppliers
D) increases in transaction costs
Answer: D
Page Ref: 17
Difficulty: Difficult
AACSB: Analytical thinking
LO: 1.2: Describe key challenges and opportunities created by new MIS technologies.
1
Copyright © 2026 Pearson Education, Inc.
,4) Between 1998 and 2021, the United States lost ________ manufacturing jobs to offshore
producers.
A) 3 million
B) 4 million
C) 5 million
D) 6 million
Answer: C
Page Ref: 19
Difficulty: Difficult
AACSB: Application of knowledge
LO: 1.2: Describe key challenges and opportunities created by new MIS technologies.
5) Which of the following statements about digital firms is not true?
A) In digital firms, time shifting and space shifting are the norm.
B) Today, most firms are fully digital.
C) Digital firms offer extraordinary opportunities for flexible global organization and
management.
D) Digital firms sense and respond to their environments more rapidly than traditional firms.
Answer: B
Page Ref: 19
Difficulty: Difficult
AACSB: Information technology
LO: 1.3: Describe key features of a digital firm.
6) Creating a marketing plan is an example of a business process.
Answer: TRUE
Page Ref: 20
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.3: Describe key features of a digital firm.
7) In order to be considered a digital firm, all of the firm's significant business relationships and
core business processes must be digitally enabled.
Answer: FALSE
Page Ref: 19
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.3: Describe key features of a digital firm.
2
Copyright © 2026 Pearson Education, Inc.
,8) Define business process. What might be a business process used at a hospital?
Answer: A business process is a set of logically related tasks and behaviors that organizations
develop over time to produce specific business results and the unique manner in which these
activities are organized and coordinated. Hiring a new employee, customer intake, and filing
medical records are examples of business processes at a hospital.
Page Ref: 20
Difficulty: Moderate
AACSB: Analytical thinking; Written and oral communication
LO: 1.3: Describe key features of a digital firm.
9) 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
Answer: C
Page Ref: 23
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
10) 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
Answer: A
Page Ref: 27
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
11) Which of the following companies is given as an example of a business using information
systems to improve supplier intimacy?
A) Citibank
B) Mandarin Oriental
C) Ritz-Carlton
D) Apple
Answer: C
Page Ref: 25
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
3
Copyright © 2026 Pearson Education, Inc.
, 12) 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
Answer: B
Page Ref: 24
Difficulty: Difficult
AACSB: Information technology
LO: 1.4: Describe the business objectives of information systems.
13) 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
Answer: A
Page Ref: 25
Difficulty: Moderate
AACSB: Analytical thinking
LO: 1.4: Describe the business objectives of information systems.
14) A business model describes how a company produces, delivers, and sells a product or service
to generate revenue.
Answer: TRUE
Page Ref: 24
Difficulty: Easy
AACSB: Application of knowledge
LO: 1.4: Describe the business objectives of information systems.
4
Copyright © 2026 Pearson Education, Inc.
