Chapter 1: Key Terminology and Evolution of E-Business

1. Which of the following best defines "e-business"?

A) Conducting online transactions with customers only

B) Using electronic means to conduct an organization’s internal and external business
C) A system where mobile phones are used for all business activities
D) A process focused on marketing products through social media

Answer: B
Explanation: E-business involves using electronic means to conduct both internal and external
business processes.

2. What is "mobile e-commerce" (m-commerce)?

A) Buying and selling products through physical stores

B) Conducting transactions via computers
C) Conducting e-commerce activities through wireless hand-held devices
D) Selling products over the phone

Answer: C
Explanation: M-commerce refers to e-commerce transactions conducted using mobile devices
like smartphones and tablets.

3. What is the main goal of a business strategy?

A) To create short-term profits

B) To reduce the cost of products
C) To achieve long-term competitive advantage and profitability
D) To follow competitors’ strategies

Answer: C
Explanation: A business strategy focuses on achieving sustainable competitive advantage and
long-term profitability.

4. Which of the following is NOT a component of e-commerce?

A) Online marketing
B) Online ordering
C) E-payment
D) Face-to-face negotiations

Answer: D
Explanation: E-commerce involves electronic transactions and processes; face-to-face
negotiations are not a part of it.

5. The term "synergy phase" in the evolution of e-business refers to:

A) The initial stage of technological adoption

B) A period of market saturation
C) A time when large companies dominate markets and achieve economies of scale
D) The collapse of e-business due to excessive investments

Answer: C
Explanation: The synergy phase is characterized by the dominance of large companies that
leverage economies of scale.

6. Which of the following describes "corporate-level strategy"?

A) Focuses on specific market competition

B) Addresses the allocation of resources across the entire organization
C) Deals with daily business operations
D) Is only concerned with online business activities

Answer: B
Explanation: Corporate-level strategy deals with the overall purpose and resource allocation
across the organization.

7. During which stage of the e-business evolution did Amazon.com launch?

A) The grassroots of e-business

B) The rise of the Internet
C) The crash
D) The synergy phase

Answer: B
Explanation: Amazon.com was launched during the rise of the Internet period, which began in
1995.
8. What does "value creation" mean in a business context?

A) Increasing a company's production costs

B) Maximizing profits by reducing employee wages
C) Developing offerings that provide benefits to customers
D) Focusing solely on company profits

Answer: C
Explanation: Value creation involves offering products or services that deliver benefits and meet
customer needs.

9. Which of the following best describes the "crash" phase in the evolution of e-business?

A) The initial growth of Internet-based companies

B) A period of excitement and exploration
C) A time when market expectations exceeded actual performance, leading to a collapse
D) The development of new online services

Answer: C
Explanation: The crash phase refers to the burst of the dotcom bubble when high expectations
led to a market collapse.

10. What does "strategy" involve according to Michael Porter?

A) Only focusing on growth

B) Achieving a unique value proposition and making trade-offs
C) Offering the lowest-priced product
D) Following industry trends without deviation

Answer: B
Explanation: Strategy, according to Porter, involves defining a unique value proposition and
making strategic trade-offs to achieve competitive advantage.

Easy:

1. Which of the following defines e-business?

o A. The buying and selling of products online
o B. Using electronic means to conduct an organization’s business internally and
externally
o C. Online transactions conducted via mobile phones
 oD. Using the internet solely for marketing purposes
Answer: B. Using electronic means to conduct an organization’s business
internally and externally
2. What does mobile e-commerce (m-commerce) refer to?
o A. Business activities conducted using laptops
o B. Transactions done through desktop computers
o C. E-commerce activities accessed via wireless hand-held devices
o D. E-business conducted within an organization
Answer: C. E-commerce activities accessed via wireless hand-held devices

Medium:

3. Which of the following is NOT part of the three levels of strategy?

o A. Corporate-level strategy
o B. Business unit strategy
o C. Functional-level strategy
o D. Market-entry strategy
Answer: D. Market-entry strategy
4. What is the primary focus of corporate-level strategy?
o A. How to compete within individual markets
o B. Allocating resources between different business units
o C. Managing daily operations and processes
o D. Conducting joint research with business partners
Answer: B. Allocating resources between different business units

Hard:

5. Which of the following phases in the life cycle model proposed by Carlota Perez
occurs after the crash?
o A. Irruption
o B. Synergy
o C. Frenzy
o D. Maturity
Answer: B. Synergy
6. Which of the following is a characteristic of the ‘crash’ phase in the life cycle of
technological revolutions?
o A. Companies begin to collaborate on standards
o B. The economy is dominated by previous technologies
o C. The stock market experiences a massive downturn
o D. Start-ups dominate the market
Answer: C. The stock market experiences a massive downturn

Very Hard:

7. What distinguishes e-business from e-commerce?

 oA. E-business focuses on transactions, while e-commerce covers all business
activities.
o B. E-business involves using the Internet to conduct external business activities
only.
o C. E-business encompasses all electronic activities in an organization, while e-
commerce focuses on external transaction facilitation.
o D. E-business is restricted to mobile platforms, while e-commerce includes any
electronic devices.
Answer: C. E-business encompasses all electronic activities in an
organization, while e-commerce focuses on external transaction facilitation.
8. What is the final stage in the life cycle of technological revolutions?
o A. Crash
o B. Irruption
o C. Maturity
o D. Synergy
Answer: C. Maturity

Chapter 2: Overview of the E-Business Strategy Framework

1. Which of the following is NOT a key challenge in e-business strategy formulation?

A) High uncertainty of future developments

B) Evaluating contradictory decision criteria
C) Finding ways to cooperate with competitors
D) Choosing between long-term and short-term profitability

Answer: C
Explanation: Cooperation with competitors is a component of strategy execution, not necessarily
a key challenge in strategy formulation.

2. What is the main goal of e-business strategy?

A) Achieving short-term growth

B) Maximizing internal efficiency
C) Achieving a sustainable competitive advantage
D) Expanding into multiple markets simultaneously

Answer: C
Explanation: The main goal of e-business strategy is to achieve sustainable competitive
advantage over rivals.
3. What is the focus of external analysis in e-business strategy formulation?

A) Understanding the internal resources of the firm

B) Gaining insights into the company’s market share
C) Understanding external developments that affect the company
D) Identifying the company’s weaknesses

Answer: C
Explanation: External analysis is about understanding external trends and developments that
could impact the firm’s strategy.

4. The e-business strategy framework links which two perspectives?

A) Internal and external

B) Short-term and long-term
C) Digital and physical business
D) Customer and supplier

Answer: A
Explanation: The e-business strategy framework connects the internal and external perspectives
to ensure a comprehensive strategy.

5. Which of the following is part of the internal analysis in e-business strategy?

A) Economic trends affecting the industry

B) Competitors’ pricing strategies
C) Key resources and capabilities of the firm
D) Legal regulations in the company’s country

Answer: C
Explanation: Internal analysis focuses on the company’s resources and capabilities to implement
or sustain the e-business strategy.

6. What does “sustaining competitive advantage” involve in the context of e-business

strategy?

A) Using low-cost strategies to undercut competitors

B) Continuously adapting to prevent imitation and disruptive innovations
C) Expanding rapidly into new markets
D) Partnering with every competitor to reduce competition
Answer: B
Explanation: Sustaining competitive advantage involves adapting to market changes and
preventing competitors from imitating the firm’s strategies.

7. Which of the following is a key element of the e-business strategy framework?

A) Setting sales targets for the next quarter

B) Identifying disruptive technologies
C) Strategic analysis, strategy formulation, and strategy implementation
D) Launching new products without market research

Answer: C
Explanation: The e-business strategy framework involves strategic analysis, strategy
formulation, and strategy implementation as its core elements.

8. What is a typical challenge companies face during e-business strategy formulation?

A) Selecting which technologies to use

B) Evaluating the potential size of a new market
C) High levels of uncertainty about future technological and market trends
D) Choosing the right suppliers for the business

Answer: C
Explanation: High uncertainty about future technological and market trends is a major challenge
in strategy formulation.

9. In e-business strategy, the “value process framework” helps companies to:

A) Create new products and services

B) Link external and internal perspectives of the strategy
C) Develop short-term financial forecasts
D) Determine their corporate social responsibility strategy

Answer: B
Explanation: The value process framework links the external and internal perspectives of the e-
business strategy.
10. Which of the following is NOT a step in the systematic approach to e-business strategy
formulation?

A) External analysis
B) Internal analysis
C) Implementing a strategy before testing
D) Strategy formulation

Answer: C
Explanation: Implementing a strategy before proper analysis and testing is not part of the
systematic approach to strategy formulation.

1. Which of the following factors is part of the political and legal environment in the
macro-environment analysis?

A) Internet usage patterns

B) Taxation and monopoly legislation
C) Broadband Internet availability
D) Market segmentation

Answer: B
Explanation: Political and legal factors include taxation, monopoly legislation, and
environmental laws.

2. Which of the following best describes the economic environment in the context of
external analysis?

A) Population demographics and income distribution

B) Interest and exchange rates, stock market trends, and economic growth
C) Legislation about online privacy
D) Evolution of technology standards like TCP/IP

Answer: B
Explanation: The economic environment considers factors like interest and exchange rates, stock
market trends, and overall economic growth.

3. What is the focus of the "social environment" in the macro-environment analysis?

A) Analyzing technological developments

B) Studying consumer behavior and online usage patterns
C) Monitoring political regulations affecting business
D) Tracking the environmental impact of online businesses
Answer: B
Explanation: The social environment looks at factors like population demographics, social
mobility, and online usage patterns.

4. In the "five forces" industry framework, which of the following is NOT one of the five
forces?

A) Industry rivalry
B) Threat of new entrants
C) Technological advancements
D) Bargaining power of buyers

Answer: C
Explanation: Technological advancements are part of the macro-environment, not the five forces
framework. The five forces include industry rivalry, threat of new entrants, bargaining power of
suppliers and buyers, and threat of substitute products.

5. What is the main objective of using the "five forces" framework in industry analysis?

A) To evaluate company’s internal strengths

B) To analyze the attractiveness and profitability of an industry
C) To understand technological trends
D) To monitor economic growth in various regions

Answer: B
Explanation: The five forces framework is used to evaluate the attractiveness and profitability of
an industry by assessing competitive pressures.

6. Which of the following factors increases the intensity of industry rivalry, according to
the five forces framework?

A) High industry growth rate

B) High differentiation between products
C) High fixed costs and excess capacity
D) A small number of competitors

Answer: C
Explanation: High fixed costs and excess capacity lead to intense competition within an industry.
7. What effect does the Internet have on barriers to entry in many industries?

A) It always increases the capital required to enter an industry

B) It reduces barriers by enabling easier market entry through digital channels
C) It removes all barriers to entry
D) It strengthens existing physical distribution networks

Answer: B
Explanation: The Internet can reduce barriers to entry by allowing new entrants to reach
customers via digital channels, without the need for physical infrastructure.

8. What is the "co-opetition" framework?

A) A framework that focuses on purely competitive dynamics between companies

B) A strategy where companies collaborate and compete simultaneously
C) A legal framework for monitoring online privacy
D) A marketing strategy to boost product sales

Answer: B
Explanation: Co-opetition refers to a strategy where companies both cooperate and compete in
the marketplace, often for mutual benefits.

9. In the co-opetition framework, which of the following are key players in the "value net"?

A) Governments, suppliers, competitors, and consumers

B) Suppliers, competitors, customers, and complementors
C) Regulators, employees, customers, and suppliers
D) Employees, shareholders, regulators, and customers

Answer: B
Explanation: The "value net" framework includes suppliers, competitors, customers, and
complementors as key players that interact within the market.

10. Which of the following is a reason to segment markets in e-business?

A) To increase production costs

B) To understand customer preferences and identify substantial market opportunities
C) To reduce the quality of products
D) To reduce competition
Answer: B
Explanation: Segmenting markets helps businesses understand customer preferences and the
potential size of different market segments.

1. Which of the following is NOT a component of the macro-environment?

o A. Political and legal environment
o B. Social environment
o C. Technological environment
o D. Brand loyalty
Answer: D. Brand loyalty

2. What is a major factor in the technological environment that has driven the
development of the Internet?
o A. Interest rates
o B. Zoning laws
o C. TCP/IP and HTTP standards
o D. Environmental laws
Answer: C. TCP/IP and HTTP standards

Medium:

3. Which of the following is NOT part of Porter’s five forces?

o A. Industry rivalry
o B. Bargaining power of buyers
o C. Political and legal environment
o D. Threat of substitute products
Answer: C. Political and legal environment

4. In the co-opetition framework, which of the following is considered a key player in

the value net?
o A. Government regulators
o B. Competitors
o C. Environmental groups
o D. Customers and suppliers
Answer: D. Customers and suppliers

Hard:

5. How does the Internet affect barriers to entry in an industry?

o A. It always increases the barriers to entry by requiring more capital
investment.
o B. It has a mixed impact, reducing capital requirements but increasing trust
and brand loyalty challenges.
 o C. It significantly reduces barriers to entry by eliminating the need for
physical goods distribution.
o D. It increases barriers to entry by requiring businesses to have an advanced
technological infrastructure.
Answer: B. It has a mixed impact, reducing capital requirements but
increasing trust and brand loyalty challenges.

6. Which of the following best explains the co-opetition concept in an industry?

o A. Firms only compete for market share.
o B. Firms both cooperate and compete to increase industry standards and
customer value.
o C. Firms avoid working together to prevent sharing intellectual property.
o D. Firms focus only on competing through price wars.
Answer: B. Firms both cooperate and compete to increase industry
standards and customer value.

These questions cover key aspects of the chapter, from understanding macro-environment
influences to more complex frameworks like co-opetition.

CHUONGV4

Easy:

1. Which of the following is a key characteristic of the political and legal environment?
o A. Interest rates
o B. Income distribution
o C. Taxation and monopoly legislation
o D. Wireless technology
Answer: C. Taxation and monopoly legislation

2. What is an example of the social environment impacting e-business?

o A. High fixed costs
o B. Online usage patterns
o C. Low switching costs
o D. XML and HTTP standards
Answer: B. Online usage patterns

Medium:

3. Which of the following is a factor that contributes to high industry rivalry according
to the five forces framework?
o A. High differentiation between products
o B. Low fixed costs
o C. Excess capacity
 o D. High growth rate of the industry
Answer: C. Excess capacity

4. The intensity of pressure from substitute products in an industry depends on:

o A. The number of direct competitors
o B. The availability and price of similar products
o C. The level of government regulation
o D. The number of suppliers in the market
Answer: B. The availability and price of similar products

Hard:

5. Which of the following is a reason why a firm should segment its e-business market?
o A. To make competitors more visible
o B. To reduce competition in a specific market
o C. To gain insights into customer preferences and segment size
o D. To lower switching costs for customers
Answer: C. To gain insights into customer preferences and segment
size

6. Which of the following is NOT a key player category in the 'value net' framework?
o A. Customers
o B. Competitors
o C. Suppliers
o D. Regulatory bodies
Answer: D. Regulatory bodies

7. Which factor is NOT a typical barrier to entry in the digital economy?

o A. High fixed costs
o B. High learning curve
o C. Strong intellectual property protection
o D. High differentiation of product designs
Answer: D. High differentiation of product designs

8. How does co-opetition help firms in an industry?

o A. It allows firms to avoid competition altogether.
o B. It encourages firms to collaborate on standards and compete on
differentiation.
o C. It forces firms to enter price wars to gain more market share.
o D. It limits the number of firms that can enter the market.
Answer: B. It encourages firms to collaborate on standards and
compete on differentiation.
Very Hard:

9. Which of the following technological factors have driven the rise of broadband
internet adoption?
o A. Exchange rates and market growth
o B. Development of XML and Ajax
o C. The rise of 4G and 5G wireless technologies
o D. Global warming awareness
Answer: C. The rise of 4G and 5G wireless technologies

10. What is a key characteristic of the bargaining power of suppliers in the five forces
model?
o A. Suppliers hold significant control over prices when there is a high
concentration of buyers.
o B. Suppliers can easily establish a joint approach to pricing due to market
fragmentation.
o C. Suppliers lose power when products are highly differentiated.
o D. Suppliers have weak bargaining power when products are commodities
with low differentiation.
Answer: D. Suppliers have weak bargaining power when products are
commodities with low differentiation.

Easy:

1. Which of the following best describes the concept of core competence in e-business?
o A. Resources that are easy to imitate
o B. A combination of unique resources and skills that provide competitive
advantage
o C. General skills that all businesses need
o D. Only marketing-related capabilities
Answer: B. A combination of unique resources and skills that provide
competitive advantage
2. What is the primary purpose of the value chain in a business?
o A. To increase competition
o B. To create and capture value through a series of activities
o C. To reduce costs of suppliers
o D. To outsource all business activities
Answer: B. To create and capture value through a series of activities

Medium:

3. Which of the following is NOT part of the primary activities in the value chain?
o A. Inbound logistics
o B. Operations
 o C. Marketing and sales
o D. Human resource management
Answer: D. Human resource management
4. In the ICDT framework, what do distribution activities refer to?
o A. Two-way communication with customers
o B. The delivery of physical products
o C. The online delivery of digital goods such as software and music
o D. The creation of marketing strategies
Answer: C. The online delivery of digital goods such as software and music
5. What is one of the biggest challenges associated with online transaction activities?
o A. Limited product availability
o B. High shipping costs
o C. Consumer fear of fraud and limited payment methods
o D. Lack of digital content
Answer: C. Consumer fear of fraud and limited payment methods

Hard:

6. What does the concept of the virtual value chain emphasize?

o A. Outsourcing business processes to third parties
o B. Using information captured in the physical value chain to create additional
value
o C. Increasing reliance on physical infrastructure
o D. Eliminating all physical business operations
Answer: B. Using information captured in the physical value chain to create
additional value
7. In the ICDT framework, what do communication activities involve?
o A. Advertising products on websites
o B. One-way dissemination of information
o C. Two-way interactions with customers through emails or real-time chat
o D. Processing financial transactions
Answer: C. Two-way interactions with customers through emails or real-
time chat
8. Which of the following best describes a value network?
o A. A system where businesses operate in isolation
o B. A chain of internal business processes
o C. A network of companies collaborating through IT to add value
o D. A traditional manufacturing process
Answer: C. A network of companies collaborating through IT to add value

Very Hard:

9. What are the main criteria for a competence to be considered a core competence in
e-business?
 o A. It must be valuable, unique, hard to imitate, and relevant across multiple
markets
o B. It must be focused only on customer service
o C. It should be easy to replicate and widely available in the industry
o D. It must only reduce operational costs
Answer: A. It must be valuable, unique, hard to imitate, and relevant across
multiple markets
10. How does the Internet impact the traditional value chain?
o A. It eliminates the need for inbound and outbound logistics
o B. It simplifies physical operations but increases costs
o C. It provides high differentiation potential and offers new ways to deliver
products digitally
o D. It reduces the need for marketing and sales activities
Answer: C. It provides high differentiation potential and offers new ways to
deliver products digitally