WGU C724 Information Systems Management Exam Review and Study Guide for
Western Governors University Students | IT Governance, Systems Development
Life Cycle (SDLC), Enterprise Architecture, Project Management, Data
Management, Cybersecurity Fundamentals, Business-IT Alignment, and Practice
Questions with Detailed Rationales | Updated 2026 Assessment Prep
, QUESTION 1
Which type of information system is primarily designed to support routine, day-to-day
transactions such as sales orders, payroll, and inventory updates?
A) Executive Support System (ESS)
B) Decision Support System (DSS)
C) Management Information System (MIS)
D) Transaction Processing System (TPS)
Correct Answer: D
Rationale: Transaction Processing Systems (TPS) handle structured, high-volume
routine transactions that are essential for daily business operations. ESS supports
senior executives with strategic decisions, DSS aids in semi-structured decision-making
with analytical models, and MIS converts raw data into structured reports for middle
management—none focus primarily on routine transaction processing.
QUESTION 2
In the context of Porter's Five Forces model, which force is strengthened when
customers can easily switch to competing products or services with minimal cost?
A) Threat of new entrants
B) Bargaining power of suppliers
C) Bargaining power of buyers
D) Rivalry among existing competitors
Correct Answer: C
Rationale: The bargaining power of buyers increases when switching costs are low,
giving customers greater leverage to demand lower prices or better service. Threat of
new entrants relates to barriers to market entry; supplier power concerns vendor
influence; and rivalry describes competition intensity among current market players.
QUESTION 3
Which IT governance framework specifically focuses on aligning IT processes with
business objectives through a set of control objectives?
A) ITIL
B) PMBOK
C) COBIT
D) Six Sigma
Correct Answer: C
Rationale: COBIT (Control Objectives for Information and Related Technologies) is an IT
governance framework designed to help organizations align IT strategy with business
goals through comprehensive control objectives. ITIL focuses on IT service
management best practices; PMBOK guides project management; and Six Sigma
targets process improvement and defect reduction.
Western Governors University Students | IT Governance, Systems Development
Life Cycle (SDLC), Enterprise Architecture, Project Management, Data
Management, Cybersecurity Fundamentals, Business-IT Alignment, and Practice
Questions with Detailed Rationales | Updated 2026 Assessment Prep
, QUESTION 1
Which type of information system is primarily designed to support routine, day-to-day
transactions such as sales orders, payroll, and inventory updates?
A) Executive Support System (ESS)
B) Decision Support System (DSS)
C) Management Information System (MIS)
D) Transaction Processing System (TPS)
Correct Answer: D
Rationale: Transaction Processing Systems (TPS) handle structured, high-volume
routine transactions that are essential for daily business operations. ESS supports
senior executives with strategic decisions, DSS aids in semi-structured decision-making
with analytical models, and MIS converts raw data into structured reports for middle
management—none focus primarily on routine transaction processing.
QUESTION 2
In the context of Porter's Five Forces model, which force is strengthened when
customers can easily switch to competing products or services with minimal cost?
A) Threat of new entrants
B) Bargaining power of suppliers
C) Bargaining power of buyers
D) Rivalry among existing competitors
Correct Answer: C
Rationale: The bargaining power of buyers increases when switching costs are low,
giving customers greater leverage to demand lower prices or better service. Threat of
new entrants relates to barriers to market entry; supplier power concerns vendor
influence; and rivalry describes competition intensity among current market players.
QUESTION 3
Which IT governance framework specifically focuses on aligning IT processes with
business objectives through a set of control objectives?
A) ITIL
B) PMBOK
C) COBIT
D) Six Sigma
Correct Answer: C
Rationale: COBIT (Control Objectives for Information and Related Technologies) is an IT
governance framework designed to help organizations align IT strategy with business
goals through comprehensive control objectives. ITIL focuses on IT service
management best practices; PMBOK guides project management; and Six Sigma
targets process improvement and defect reduction.
