The Sharing Economy, Collaborative Consumption, and Creating More Efficient Markets through Technology Section 9.1 Multiple Choice Questions 1. What is the difference between collaborative consumption firms Zilok and Chegg. a. Zilok has gone public, Chegg hasn’t. b. Zilok is a service where a person comes to your home to complete a task, Chegg is a rental firm. c. Zilok provides inventory provided by participating ‘citizen suppliers’, Chegg owns its own inventory. d. Zilok is the European equivalent of Chegg. e. Zilok was purchased by Chegg underscoring the ‘winner take all’ dynamics of these markets. c; Easy Section 9.2 Multiple Choice Questions 1. Which of the following is *not* true regarding the competitive dynamics of most sharing economy marketplaces? a. Ratings represent a switching cost built over time by early participants in sharing economy marketplaces. b. Late-movers have a substantial advantage in this market since inventory should be cheaper to acquire for those firms that have entered markets more recently. c. Network effects should grow over time, favoring firms that got a successful, early start over rivals who arrived late doing the same thing. d. These are two-sided markets. e. None of the above – all statements are true. b; Moderate Section 9.3 Multiple Choice Questions 1. Which of the following is *not* an example of larger, conventional firms working with sharing economy startups? a. Apple’s purchase of Beats to give new musical artists more exposure. b. Condé Nast’s investment in Rent the Runway. c. Google’s investment in Uber. d. Walgreens’ partnership with TaskRabbit. e. W Hotel partnering with Desks Near Me. a; Moderate Section 9.4 Multiple Choice Questions 1. Which of the following statements is true about Airbnb’s revenue model? a. Airbnb currently does not make money via transactions, only from advertising listings on its website. b. Airbnb only charges property owners who rent on the website. c. Airbnb only charges guests who rent on the website. d. Airbnb charges both property owners and guests as part of transactions on their website. e. Airbnb doesn’t charge transactions for the three years after it enters a market, so as to generate two-sided network effects of property rents and guests searching for properties to stay in. d; Moderate 2. Entrepreneurs are scrappy in their quest to gather market intelligence and understand how customers respond to their offerings. How did Airbnb’s CEO gather additional intelligence on how the firm was being used? a. He bought several apartments to rent out under Airbnb b. He became an Uber driver c. He lived out of Airbnb rentals full-time d. He became a bell hop at a San Francisco Hilton Hotel e. All of the above c; Moderate Section 9.5 2 Chapter 10 Understanding Software: A Primer for Managers Section 10.1 Multiple Choice Questions 1. Computer hardware refers to: a. a precise set of instructions that orchestrate the functioning of the computer. b. the physical components of information technology. c. the mechanism through which users interact with a computer. d. a program that fulfills the requests of a client. e. handheld computing devices meant largely for mobile use outside an office setting. b; Easy 2. Which of the following is an example of computer hardware? a. Malware b. Operating system c. Application d. Platform e. A video game console e; Moderate 3. _____ refers to a precise set of instructions that tell the computer hardware what to do. a. A mnemonic b. An input device c. An output device d. Software e. Desktop d; Easy 4. If a computer system can be equated to a layered cake, which of the following combinations represents the computer system in the bottom-to-top order? a. Hardware, operating system, application, user b. User, application, hardware, operating system c. User, operating system, hardware, application d. Application, operating system, hardware, user e. Operating system, hardware, user, application a; Moderate 5. Which of the following is an operating system? a. Linux b. USB 2.0 c. Microsoft Access d. Notepad e. Wi-Fi a; Easy 3 Fill in the Blanks Section 10.2 Multiple Choice Questions 1. Android is a software product developed by Google that allows cell phone manufacturers to control hardware and establishes standards for developing and executing applications on its platform. Android is thus an example of a(n) _____. a. operating system b. programming language c. user interface d. distributed system e. database management system a; Easy 2. Microsoft’s Xbox operating system provides Xbox programmers with a set of common standards to use to access controllers, the Kinect motion sensor, play sounds, draw graphics, save files, and more. Without this, games would: a. be more reliable. b. be a lot easier to write. c. cost more. d. look same. e. not be restricted to just Microsoft’s platforms. c; Moderate 3. Firmware refers to: a. computer hardware elements visible to the human eye. b. control software stored on removable discs. c. control software stored on hard drives. d. control software stored on nonvolatile memory chips. e. computer hardware elements invisible to the human eye. d; Easy a. b. c. d. e. 4. Software (often on firmware) designed to make physical products and devices “smarter” by doing things like sharing usage information, helping diagnose problems, indicating maintenance schedules, providing alerts, or enabling devices to take orders from other systems is referred to as ___________. Desktop software programs Enterprise Resource Planning systems Embedded systems Multi-threaded Application servers c; Easy Section 10.3 4 Multiple Choice Questions 1. Which of the following is true of the difference between operating systems and application software? a. Operating systems control the hardware, while application software performs the work that users and firms are directly interested in accomplishing. b. Operating systems support tasks performed by a single user, while application software support tasks performed by multiple users. c. Operating systems control the hardware elements visible to the human eye, while application software controls the hardware elements invisible to the human eye. d. Operating systems are software packages that integrate the many functions of a business, while application software works with a minimal degree of overlap. e. Operating systems are software packages offered by a third party, while application software contains programs that are designed in-house. a; Moderate 2. _____ perform the work that users and firms are directly interested in accomplishing and can be thought of as places where a user’s real work is done. a. Emulators b. Applications c. Platforms d. Embedded systems e. Operating systems b; Easy 3. Which of the following is an example of application software? a. MS Word b. Mac OS c. Linux d. MS Windows e. Android a; Moderate 4. _____ refers to applications installed on a personal computer, typically to support tasks performed by a single user. a. Enterprise software b. Server program c. Desktop software d. Software as a service e. Database management program c; Easy 5. Which of the following functions is likely to be performed by enterprise software? a. Word processing b. Spreadsheet accounting c. Making PowerPoint presentations d. Inventory tracking e. Internet browsing d; Easy 5 6. _____ refers to a software package that integrates the many functions of a business, such as accounting, finance, inventory management, and human resources. a. Supply chain management b. Desktop software c. Customer relationship management d. Database management system e. Enterprise resource planning e; Easy 7. Systems that use data created by other systems to provide reporting and analysis for organizational decision making are called _____ systems. a. application server b. supply chain management c. enterprise resource management d. business intelligence e. customer relationship management d; Easy 8. What are the implications for firms that do not have common database systems with consistent formats across their enterprise? a. They can save infrastructural and operational costs. b. They can expect to leverage economies of scale by serving more customers. c. They can hedge against the risk of data redundancy. d. They struggle to manage their value chain efficiently. e. They profit from the aggregation of diverse data sets and enhance their repositories. d; Moderate Section 10.4 Multiple Choice Questions 1. Which of the following is not true about potential benefits to firms that create platforms? a. the potential to make their products and services more useful b. they can widen the reach of firms and products c. they can create switching costs d. they can enhance network effects e. all of the above are true e; Easy 2. _____ are software systems designed to support interoperable machine-to-machine interaction over a network. a. Scripting languages b. Client-servers c. Web services d. Caches e. Business intelligence systems c; Moderate 6 3. _____ is a set of standards for exchanging messages containing formatted data between computer applications. a. EDI b. DBMS c. CPM d. SCM e. ERP a; Easy 4. What is the most common function performed by electronic data interchanges? a. Housing and serving business logic for use and reuse by multiple electronic applications b. App store downloads and the serving of other types of rich media. c. Providing electronic reporting and analysis for organizational decision making d. Integrating various electronic functions of a business, such as accounting, finance, inventory management, and human resources e. Sending electronic equivalents of structured documents between different organizations e; Moderate 5. Which of the following technologies is being used to replace the older EDI for specifying data standards? a. Integrated development environment b. Hypertext transfer protocol c. Extensible markup language d. File transfer protocol e. Sequential query language c; Easy Section 10.5 Multiple Choice Questions 1. _____ provide the standards, syntax, statements, and instructions for writing computer software. a. Operating systems b. Application servers c. Database management systems d. Platforms e. Programming languages e; Easy 2. A(n) _____ is an application that includes an editor, a debugger, and a compiler, among other tools. a. programming language b. integrated development environment c. operating system d. extensible markup language e. enterprise resource planning system b; Easy 3. This process of converting a code into machine-readable form is known as: a. integrating. 7 b. assimilating. c. debugging. d. sequencing. e. compiling. e; Moderate 4. Which of the following characteristics is said to be Java’s biggest selling point? a. Open source nature b. Interpretability c. Platform independence d. Service-oriented architecture e. Data portability c; Easy 5. Which of the following is true of scripting languages? a. They are often designed to be interpreted within their applications. b. They are compiled to run directly by a microprocessor. c. They typically execute outside an application. d. They are faster than the development efforts found in most commercial software. e. Most of these languages are complicated with respect to user friendliness. a; Easy 6. Java is not optimized to take advantage of interface elements specific to the Mac or Windows operating systems. As a result: a. Java is not platform independent. b. Java lacks a structured programming style. c. Java is unsuitable for desktop applications. d. Java code that is compiled for the native OS and processor is slower than code running through a JVM interpreter. e. Java code has to be compiled and then interpreted, before being executed by the processor. c; Moderate Fill in the Blanks Section 10.6 Multiple Choice Questions 1. _____ refers to the practice of ensuring that an organization’s systems operate within required legal constraints, and organizational obligations. a. Security b. Compliance c. Integration d. Parallelism e. Immunity b; Easy 2. Which of the following statements is true about information systems? 8 a. Most firms spend a huge portion of their information technology budgets on training and system security. b. New programs should be thoroughly tested across the range of a firm’s hardware after deployment. c. Purchase, configuration, and licensing costs for packaged software account for most information technology expenses of a firm. d. Firms need to vigilantly manage the moving target of computer security issues. e. Total cost of ownership of information systems is often a redundant concept while making technology investment decisions. d; Moderate 3. Which of the following is one of the reasons for the failure of technology projects? a. Inadequate testing of systems before deployment b. Insufficient expenditure on information systems c. Use of matured technology d. Prolonged project periods e. Disallowing “feature creep” during development a; Moderate Chapter 11 Software in Flux: Partly Cloudy and Sometimes Free Section 11.1 Multiple Choice Questions 1. The cost of producing an additional unit of a product is known as its: a. isocost. b. transaction cost. c. marginal cost. d. redundancy cost. e. implicit cost. c; Easy 2. The software business is extremely profitable compared to the hardware business because: a. the marginal cost to produce an additional copy of a software product is effectively zero. b. of the lack of market price regulations and guidelines. c. software producers serve niche businesses sectors with high profit margins. d. software development is a one-time process with no upgrade costs. e. software firms benefit from special tax exemptions that aid profitability. a; Easy 3. _____ refers to software that is free and where anyone to look at and potentially modify the code. a. Social software b. Proprietary software c. Licensed software d. Open source software e. Software as a service d; Easy 9 Section 11.2 Multiple Choice Questions 1. Which of the following was an outdated notion regarding open source software and has been shown to be inaccurate? a. Open source software is free and its code is available for anyone to look at and potentially modify. b. Open source software code can be changed and redistributed, provided the modified software remains open and free. c. Open source software is to technology what capitalism is to economics. d. The majority of persons who work on open source projects are paid by commercially motivated employers. e. Open source is fueled on the contributions of loners tooling away for the glory of contributing to better code. e; Moderate 2. Which of the following statements relating to open source software is true? a. The flagship OSS product is the Linux operating system, now available on all scales of computing devices. b. Open source software is available for anyone to download from the Internet, but the code should not be modified. c. The vast majority of people who work on efforts like Linux are now paid to do so by non-profit organizations such as the Linux foundation. d. The source code for open source software may be modified and redistributed, provided it is priced reasonably and part of the proceeds is contributed to the Linux Foundation. e. Major hardware firms no longer employ paid staff contributing to open source projects. a; Moderate 3. Which of the following sets of software represents the constituents of the LAMP stack? a. LimeWire, Acrobat Reader, Mozilla, Python b. Linux, Apache, MySQL, Perl c. Lingo, Afnix, Moby, PPL d. Linux, Android, Mac OS X, PHP e. LimeWire, AppleScript, MATLAB, Photoshop b; Moderate 4. The LAMP stack of open source products is used: a. as a template for most operating systems. b. to provide guidelines for programming databases. c. in debugging most of the software tools available today. d. as a global set of standards for software product improvements and official releases. e. to power many of the Internet’s most popular Web sites. e; Moderate Section 11.3 Multiple Choice Questions 10 1. Technology products with particularly strong security features are said to be: a. integrated. b. virtualized. c. hardened. d. scalable. e. white swans. c; Easy 2. The scalability of a software product is defined as the: a. capability to continue operations even if a component fails. b. long-term market viability of a software product. c. ability to take advantage of complementary products developed for a prior generation of technology. d. ability to be easily expanded to manage workload increases. e. ability to replace a technically superior product upon market inception. d; Moderate 3. Open source software products often have fewer bugs than their commercial counterparts because of the: a. large number of persons who have looked at the code. b. stringent quality checks undertaken by the original developers. c. emphasis placed on technological superiority of OSS products. d. relatively poorer standards of commercially programmed software. e. pyramidal programming practice followed by OSS developers. a; Easy 4. Vendors who use open source as part of their product offerings can expect to bring new products to the market faster because: a. open source products have lower product lifecycles. b. the large number of people who look at the code help speed up product development. c. they can skip whole segments of the software development process. d. open source software programming is based on simpler code than commercial products. e. the open source nature of the products ensures they don’t have to conduct debugging tests. c; Easy 5. Which of the following was considered a contributor to vulnerabilities in the OpenSSL security product, known as the Heartbleed bug: a. Overseas hackers modified the open source code and uploaded a compromise version to the Internet, which became widely used. b. Few developers were working on the project, so the ideal that “given enough eyeballs, all bugs are shallow” wasn’t met with OpenSSL. c. Developers failed to see a major incompatibility with versions of the Windows operating system and Chrome browser. d. There was no commercial entity overseeing the project. e. A Linux update was not coordinated with OpenSSL, leaving a gaping hole when the two products were used together to transmit content over the Internet. b; Moderate Section 11.4 11 Multiple Choice Questions 1. Less popular open source products are not likely to attract the community of users and contributors necessary to help improve these products over time. This situation reiterates the belief that _____ are a key to success. a. proprietary products b. brand strategies c. network effects d. technology expenses e. advertising campaigns c; Easy Multiple Choice Questions 1. Oracle, a firm that sells commercial ERP and database products, provides Linux for free, selling highmargin Linux support contracts for as much as five hundred thousand dollars. Oracle’s motivation for this lies in: a. accelerating the shift of open source software towards a proprietary regime. b. using open source software to fuel sales of hardware. c. impoverishing other open source developers and furthering its own proprietary offerings. d. using open source software to wean customers away from competitors. e. protecting itself from the risks of distributing code while unaware of legal implications. d; Moderate 2. Which of the following is one of the sources of revenue for open source vendors? a. Licensing OSS for incorporation into subsequent open source products b. Selling open source products at prices well below commercial products c. Marketing versions of open source software masked as proprietary software d. Claiming royalties on software based on open source code e. Selling support and consulting services e; Moderate 3. All of the costs associated with the design, development, testing, implementation, documentation, training and maintenance of a software system are collectively termed as: a. total cost of ownership. b. economies of scale. c. economic value added. d. return on investment. e. cost to company. a; Easy Section 15.6 True/False Questions Multiple Choice Questions 1. Which of the following refers to a variant of utility computing where vendors provide the operating system and supporting software like database management systems but where client firms write their own code? a. Platform as a service 12 b. Host service vendor c. Software as a service d. Application service provider e. Infrastructure as a service a; Moderate 2. Cloud computing refers to: a. replacing computing resources with services provided over the Internet. b. a technology that can make a single computer behave like many separate computers. c. designing computers with many microprocessors that work together, simultaneously, to solve problems. d. designing microprocessors with two or more calculating processor cores on the same piece of silicon. e. manufacturing semiconductors as a stack of multiple, interconnected layers instead of in one flat plane. a; Easy Fill in the Blanks Section 11.7 Multiple Choice Questions 1. Which of the following is true about cloud computing? a. Cloud firms require their customers to move all of their software off site and onto the cloud in order to meet legal requirements demanded by US regulators and European regulators. b. Cloud computing is not as green as traditional computing. c. Cloud infrastructure is often located in warehouse-style buildings designed for computers, not people. d. Cloud firms are usually crammed inside inefficiently cooled downtown high-rises. e. Cloud computing firms often have data centers that are not designed to pool and efficiently manage computing resources. c; Moderate 2. Which of the following is true of software as a service (SaaS)? a. Firms spend more using SaaS. b. It refers to software that is made available by a third-party online. c. Due to US and European legal requirements, there are no accounting and corporate finance implications for SaaS in these regions. d. Saas firms face diseconomies of scale. e. SaaS vendors are less attuned to customer needs. b; Moderate 3. Vendors frequently sign _____ with their customers to ensure a guaranteed uptime and define their ability to meet demand spikes. a. infrastructure provider contracts b. host vendor terms c. open source contracts d. service level agreements e. requests for information 13 d; Easy 4. Products and services designed to target a specific industry are known as _____. a. mature markets b. commodities c. vertical niches d. parity products e. unified markets c; Easy 5. Which of the following is one of the characteristics of using software as a service model? a. Longer deployment times b. Scalable systems c. Fixed operating expenses d. Heightened financial risk e. Higher maintenance costs b; Easy 6. Which of the following is one of the benefits enjoyed by SaaS vendors? a. Development across multiple platforms b. Limits accessibility to resources by just about anybody c. Lower distribution costs d. Lower hardware maintenance costs e. Faster product deployment c; Moderate Section 11.8 Multiple Choice Questions 1. One of the risks associated with SaaS is the: a. dependence on a single vendor. b. inability to migrate to new versions of software. c. reduced reliance on a network connection. d. costs associated with storing large amounts of data in-house. e. user interface of Web-based software being more sophisticated than desktop alternatives. a; Moderate 2. Employees, at their own initiative, can go to SocialText or Google Sites and set up a wiki, WordPress to start blogging, or subscribe to a SaaS offering like SalesForce.com, all without corporate oversight and approval. This _____ of technology is one of the challenges associated with the adoption of SaaS models. a. crowdsourcing b. disintermediation c. integration d. scalability e. consumerization e; Moderate Section 11.9 14 Multiple Choice Questions 1. Installing a complex set of an organization’s legacy systems on third-party hardware can be a brutal challenge. For that reason we can expect most cloud computing efforts to focus on: a. new software development projects. b. bettering the options for old software. c. improving quality of existing code. d. migrating to a set of robust and well-defined standards. e. the development of large pools of in-house specially suited hardware. a; Easy 2. Cloud vendors that hosting hardware, operating system, database, and other software, which clients can then use to build their own applications, are said to be providing: a. Software as a Service. b. Hardware as a Service. c. Platform as a Service. d. Service Oriented Architecture. e. Service Level Agreement. a; Easy 3. Cloud computing is not typically suited for situations: a. involving offloading of expensive computing tasks. b. where complex legacy systems have to be ported. c. with no existing regulatory compliance issues. d. where pricing economics favor buying over renting. e. characterized by limited-time tasks. b; Moderate 4. _____ is a term used to describe unpredictable, but highly impactful events. a. Straddling b. Viral trojans c. Black swans d. Power plays e. Flash outs c; Easy Section 11.10 Multiple Choice Questions 1. Which of the following statements regarding cloud computing is true? a. The shift to cloud computing does not alter the margin structure for many in the computing industry. b. Cloud computing has led to decreased hardware and software sales at many firms, while increasing service expenses. c. Cloud computing discourages innovation and therefore changes the desired skills mix and job outlook for IS workers. d. Cloud computing has raised the barriers for entry to new entrants to the information technology markets. 15