, TESTBANK FOR
Management Information Systems Managing the Digital Firm, 18th
edition Laudon
Important Notes
The file includes the complete test bank, organized chapter by chapter.
A sample of selected pages has been provided for preview.
All available appendices and Excel files (if included in the original resources) are
provided.
We continuously update our files to ensure you receive the latest and most accurate
editions.
New editions are added regularly – stay connected for updates!
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If you believe you have purchased the wrong file, don’t worry. Contact us anytime and we
will gladly replace it with the correct version.
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,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.
,15) You work for an auto dealer. How could you use information systems to achieve greater
customer intimacy?
Answer: When a business really knows its customers and serves them well (customer
intimacy), the customers generally respond by returning and purchasing more. This raises
revenues and profits. To use information systems to achieve greater customer intimacy for an
auto dealer, you could create a website and/or mobile app that allows customers to order
customized cars and communicate with support personnel and other car owners. You could
create an automated email service reminding car owners to take their cars in for periodic check-
ups. You could have an information system that tracks customer preferences in your local area,
so you can offer cars that reflect local customer needs and desires.
Page Ref: 24
Difficulty: Difficult
AACSB: Application of knowledge; Information technology; Written and oral communication
LO: 1.4: Describe the business objectives of information systems.
16) Define operational excellence. How have information systems helped Walmart achieve it?
Answer: Operational excellence involves the achievement of higher levels of efficiency and
productivity. Walmart, the largest retailer on earth, exemplifies the power of information systems
coupled with state-of-the-art business practices and supportive management to achieve
operational excellence. Information systems such as Walmart's Retail Link system, which
digitally links its suppliers to every one of Walmart's stores, have helped Walmart achieve
operational excellence by improving communications with suppliers and optimizing its supply
chain. As soon as a customer purchases an item, the supplier monitoring the item knows to ship a
replacement to the shelf.
Page Ref: 23
Difficulty: Moderate
AACSB: Application of knowledge; Information technology; Written and oral communication
LO: 1.4: Describe the business objectives of information systems.
17) The three activities in an information system that produce the information organizations use
to make decisions, control operations, analyze problems, and create new products are ________.
A) input, processing, and output
B) input, output, and feedback
C) data, information, and analysis
D) data analysis, processing, and feedback
Answer: A
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
5
Copyright © 2026 Pearson Education, Inc.
,18) Raw data collected at checkout counters in a grocery store is an example of ________.
A) output
B) processing
C) feedback
D) input
Answer: D
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
19) The total number of bottles of dish detergent sold at a particular store is an example of which
of the following?
A) Input
B) Raw data
C) Meaningful information
D) Feedback
Answer: C
Page Ref: 31
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
20) Output ________.
A) is feedback that has been processed to create meaningful information
B) is information that is returned to appropriate members of the organization to help them
evaluate the input stage
C) transforms raw data into processed information
D) transfers processed information to the people who will use it or to the activities for which it
will be used
Answer: D
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
21) Converting raw data into a more meaningful form is called ________.
A) capturing
B) processing
C) organizing
D) feedback
Answer: B
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
6
Copyright © 2026 Pearson Education, Inc.
,22) Which of the following is an example of raw data from an automobile manufacturer?
A) An average of 120 Subarus sold daily in New York in 2020.
B) 1,200 Subaru Outbacks sold during the first quarter of 2020 in New York.
C) One Subaru Outback sold July 27, 2020 in Mohegan Lake, New York for $24,000.
D) Annual sales of Subaru Outbacks increased 5.3%.
Answer: C
Page Ref: 32
Difficulty: Difficult
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
23) All of the following are examples of environmental actors in an information system except
________.
A) competitors
B) regulatory agencies
C) employees
D) suppliers
Answer: C
Page Ref: 33
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
24) Which of the following would be used as an input for an information system?
A) Sales by region report
B) Sales for stores in a region
C) Product ID and price
D) Year-to date-sales of products
Answer: C
Page Ref: 32
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
25) Which of the following deals with behavioral issues as well as technical issues surrounding
the development, use, and impact of information systems used by managers and employees in the
firm?
A) Computer literacy
B) Management information systems
C) Business processes
D) Information technology infrastructure
Answer: B
Page Ref: 35
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
7
Copyright © 2026 Pearson Education, Inc.
, 26) Information technology (IT) consists of all hardware and software that a firm needs to use in
order to achieve its business objectives.
Answer: TRUE
Page Ref: 30
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
27) Information systems literacy focuses primarily on knowledge of information technology.
Answer: FALSE
Page Ref: 35
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
28) What is the difference between information technology and information systems? Describe
some of the functions of information systems.
Answer: Information technology (IT) consists of all the hardware and software that a firm
needs to use to achieve its business objectives. Information systems are more complex. An
information system can be defined technically as a set of interrelated components that collect (or
retrieve), process, store, and distribute information to support decision making and control in an
organization. An information system has managerial and organizational components as well as
technology.
An information system:
• supports decision making, coordination, and control.
• helps employees analyze problems.
• helps employees visualize complex subjects.
• helps create new products.
Page Ref: 30
Difficulty: Moderate
AACSB: Analytical thinking; Written and oral communication
LO: 1.5: Explain what an information system is and how it works.
29) You are a marketing manager for a national movie theater chain. Give an example of data
that your department could use for creating meaningful information. What type of information
could that data produce?
Answer: Movie ticket sales from individual theaters would be an example of raw data.
Meaningful information from this data would be the average number of tickets sold to seniors on
certain days of the week.
Page Ref: 31
Difficulty: Difficult
AACSB: Analytical thinking; Written and oral communication
LO: 1.5: Explain what an information system is and how it works.
8
Copyright © 2026 Pearson Education, Inc.
Management Information Systems Managing the Digital Firm, 18th
edition Laudon
Important Notes
The file includes the complete test bank, organized chapter by chapter.
A sample of selected pages has been provided for preview.
All available appendices and Excel files (if included in the original resources) are
provided.
We continuously update our files to ensure you receive the latest and most accurate
editions.
New editions are added regularly – stay connected for updates!
Purchase Guarantee
If you believe you have purchased the wrong file, don’t worry. Contact us anytime and we
will gladly replace it with the correct version.
Contact Email:
,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.
,15) You work for an auto dealer. How could you use information systems to achieve greater
customer intimacy?
Answer: When a business really knows its customers and serves them well (customer
intimacy), the customers generally respond by returning and purchasing more. This raises
revenues and profits. To use information systems to achieve greater customer intimacy for an
auto dealer, you could create a website and/or mobile app that allows customers to order
customized cars and communicate with support personnel and other car owners. You could
create an automated email service reminding car owners to take their cars in for periodic check-
ups. You could have an information system that tracks customer preferences in your local area,
so you can offer cars that reflect local customer needs and desires.
Page Ref: 24
Difficulty: Difficult
AACSB: Application of knowledge; Information technology; Written and oral communication
LO: 1.4: Describe the business objectives of information systems.
16) Define operational excellence. How have information systems helped Walmart achieve it?
Answer: Operational excellence involves the achievement of higher levels of efficiency and
productivity. Walmart, the largest retailer on earth, exemplifies the power of information systems
coupled with state-of-the-art business practices and supportive management to achieve
operational excellence. Information systems such as Walmart's Retail Link system, which
digitally links its suppliers to every one of Walmart's stores, have helped Walmart achieve
operational excellence by improving communications with suppliers and optimizing its supply
chain. As soon as a customer purchases an item, the supplier monitoring the item knows to ship a
replacement to the shelf.
Page Ref: 23
Difficulty: Moderate
AACSB: Application of knowledge; Information technology; Written and oral communication
LO: 1.4: Describe the business objectives of information systems.
17) The three activities in an information system that produce the information organizations use
to make decisions, control operations, analyze problems, and create new products are ________.
A) input, processing, and output
B) input, output, and feedback
C) data, information, and analysis
D) data analysis, processing, and feedback
Answer: A
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
5
Copyright © 2026 Pearson Education, Inc.
,18) Raw data collected at checkout counters in a grocery store is an example of ________.
A) output
B) processing
C) feedback
D) input
Answer: D
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
19) The total number of bottles of dish detergent sold at a particular store is an example of which
of the following?
A) Input
B) Raw data
C) Meaningful information
D) Feedback
Answer: C
Page Ref: 31
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
20) Output ________.
A) is feedback that has been processed to create meaningful information
B) is information that is returned to appropriate members of the organization to help them
evaluate the input stage
C) transforms raw data into processed information
D) transfers processed information to the people who will use it or to the activities for which it
will be used
Answer: D
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
21) Converting raw data into a more meaningful form is called ________.
A) capturing
B) processing
C) organizing
D) feedback
Answer: B
Page Ref: 32
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
6
Copyright © 2026 Pearson Education, Inc.
,22) Which of the following is an example of raw data from an automobile manufacturer?
A) An average of 120 Subarus sold daily in New York in 2020.
B) 1,200 Subaru Outbacks sold during the first quarter of 2020 in New York.
C) One Subaru Outback sold July 27, 2020 in Mohegan Lake, New York for $24,000.
D) Annual sales of Subaru Outbacks increased 5.3%.
Answer: C
Page Ref: 32
Difficulty: Difficult
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
23) All of the following are examples of environmental actors in an information system except
________.
A) competitors
B) regulatory agencies
C) employees
D) suppliers
Answer: C
Page Ref: 33
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
24) Which of the following would be used as an input for an information system?
A) Sales by region report
B) Sales for stores in a region
C) Product ID and price
D) Year-to date-sales of products
Answer: C
Page Ref: 32
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
25) Which of the following deals with behavioral issues as well as technical issues surrounding
the development, use, and impact of information systems used by managers and employees in the
firm?
A) Computer literacy
B) Management information systems
C) Business processes
D) Information technology infrastructure
Answer: B
Page Ref: 35
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
7
Copyright © 2026 Pearson Education, Inc.
, 26) Information technology (IT) consists of all hardware and software that a firm needs to use in
order to achieve its business objectives.
Answer: TRUE
Page Ref: 30
Difficulty: Moderate
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
27) Information systems literacy focuses primarily on knowledge of information technology.
Answer: FALSE
Page Ref: 35
Difficulty: Easy
AACSB: Information technology
LO: 1.5: Explain what an information system is and how it works.
28) What is the difference between information technology and information systems? Describe
some of the functions of information systems.
Answer: Information technology (IT) consists of all the hardware and software that a firm
needs to use to achieve its business objectives. Information systems are more complex. An
information system can be defined technically as a set of interrelated components that collect (or
retrieve), process, store, and distribute information to support decision making and control in an
organization. An information system has managerial and organizational components as well as
technology.
An information system:
• supports decision making, coordination, and control.
• helps employees analyze problems.
• helps employees visualize complex subjects.
• helps create new products.
Page Ref: 30
Difficulty: Moderate
AACSB: Analytical thinking; Written and oral communication
LO: 1.5: Explain what an information system is and how it works.
29) You are a marketing manager for a national movie theater chain. Give an example of data
that your department could use for creating meaningful information. What type of information
could that data produce?
Answer: Movie ticket sales from individual theaters would be an example of raw data.
Meaningful information from this data would be the average number of tickets sold to seniors on
certain days of the week.
Page Ref: 31
Difficulty: Difficult
AACSB: Analytical thinking; Written and oral communication
LO: 1.5: Explain what an information system is and how it works.
8
Copyright © 2026 Pearson Education, Inc.
