MGT 2210 Exam 3 Practice Test

Per the textbook, why is it important for technology platforms to leverage distribution channels effectively? It ensures their product reaches a wide audience, reinforcing network effects through increased adoption. It gives them an excuse to increase product prices due to distribution costs. It enables them to focus on production while outsourcing marketing responsibility. It allows them to rely less on the product's quality and more on its availability.

It ensures their product reaches a wide audience, reinforcing network effects through increased adoption.

Per the textbook, what best describes complementary benefits in the context of network effects? Environmental benefits from using digital platforms over physical products. Benefits that competitors provide with similar products. Additional advantages or services that enhance the core offering's value. Direct benefits received by every new user joining the platform.

*Additional advantages or services that enhance the core offering's value.

How does the Social Graph benefit Facebook users? By increasing the speed and efficiency of the platform's servers. By enabling more relevant and personalized content in their feeds. By providing users with monthly reports of their activities and interactions. By automatically connecting users with others who have similar interests.

*By enabling more relevant and personalized content in their feeds.

What does the platform business model disrupt in traditional markets? Linear value chain view Digital marketing strategies Hierarchical corporate structures Offline retail experiences

*Linear value chain view

Per the textbook, what is a primary consequence of high "switching costs" in digital platform ecosystems? Platforms are forced to switch between different operational models frequently. Users are less likely to migrate to other platforms, even if better options are available. Users are encouraged to switch between platforms to find the best deal. Platforms must constantly innovate to justify the high costs to users.

*Users are less likely to migrate to other platforms, even if better options are available.

In business analytics, why is it important for insights to have a clear connection to strategic objectives? It ensures that the insights are relevant and can lead to actionable decisions. It allows companies to bypass detailed data analysis. It focuses on competition rather than internal growth. It guarantees financial success for any initiatives taken.

It ensures that the insights are relevant and can lead to actionable decisions.

Per the textbook, why is it important for technology platforms to leverage distribution channels effectively? It enables them to focus on production while outsourcing marketing responsibility. It ensures their product reaches a wide audience, reinforcing network effects through increased adoption. It gives them an excuse to increase product prices due to distribution costs. It allows them to rely less on the product's quality and more on its availability.

It ensures their product reaches a wide audience, reinforcing network effects through increased adoption.

According to the video on false news, what is an inherent risk in the current speed of information dissemination, as implied in the transcript? It facilitates the rapid spread of misinformation before facts can be verified. The speed causes technological issues with older devices. People read less than they used to because they get information faster. Quick information spread leads to an overload of factual reports.

It facilitates the rapid spread of misinformation before facts can be verified.

Per the textbook, what is the main advantage of "Being Compatible with the Leading Network" for new tech entrants? It guarantees instant brand recognition and market dominance. It allows new entrants to avoid investing in customer service. It facilitates user adoption due to reduced switching costs and familiar usage paradigms. It legally binds leading networks to share a portion of their revenue.

It facilitates user adoption due to reduced switching costs and familiar usage paradigms.

What is the role of prescriptive analytics in business decision-making? It solely interprets past business performance. It predicts future business challenges with 100% accuracy. It suggests possible actions and guides future decisions. It negates the need for human decision-making.

It suggests possible actions and guides future decisions.

According to the video on false news, what is "circular reporting" as defined in the transcript? It's when journalists circle back to their sources before publishing a story. It's when a story gets reported in a roundabout, confusing manner. It's the constant repetition of correct information to ensure accuracy. It's when one publication publishes misinformation, another reprints it, and the original then cites the reprint as the source.

It's when one publication publishes misinformation, another reprints it, and the original then cites the reprint as the source.

Per the textbook, what is the primary risk associated with the Osborne Effect? Prematurely announcing future products, thus hurting sales of current offerings. Overhyping product features that cannot realistically be delivered. Underestimating competitor reaction and market dynamics post-announcement. Mismanaging inventory and supply chains leading to product unavailability.

Prematurely announcing future products, thus hurting sales of current offerings.

Per the textbook, which factor contributes most directly to a product's stronger staying power in the market due to network effects? Availability in multiple languages. Extensive offline marketing campaigns. Increasing value as more users join the network. Frequent updates and bug fixes.

Increasing value as more users join the network.

Per the textbook, what are congestion effects in the realm of network effects? Conflicts in team dynamics during product development phases. The environmental impact of discarded tech products. Traffic issues arising during product shipments due to poor logistics. A decrease in a product’s value as more users overload the system, degrading the user experience.

A decrease in a product’s value as more users overload the system, degrading the user experience.

Per the textbook, what is "machine learning" in the context of data and technology? A system that enables machines to make decisions and carry out tasks without human intervention. The process of machines collecting data and learning about users' habits over time. A type of data analysis that requires human beings to teach machines how to learn complex patterns. A category of artificial intelligence that allows software applications to become more accurate in predicting outcomes without being explicitly programmed.

A category of artificial intelligence that allows software applications to become more accurate in predicting outcomes without being explicitly programmed.

What is a general definition of a platform in business? A collection of essential components that enables various goods to function together A standalone product that functions independently An organizational structure that prioritizes hierarchical communication A business strategy focusing solely on digital marketing

A collection of essential components that enables various goods to function together

When interpreting a decision tree, what does a longer path from the root node to a leaf node typically indicate? A simpler decision process with fewer conditions A less important decision outcome A more complex decision process with multiple conditions to satisfy An error in the tree construction process

A more complex decision process with multiple conditions to satisfy

At a cutting-edge healthcare analytics firm, you've unearthed a data pattern that proposes a transformative approach to patient care, one that could redefine existing paradigms. This discovery has caused ripples of excitement about the potential changes in patient interaction models. In the context of analytical findings, how would this insight be classified? An incremental insight, as it builds upon existing knowledge to suggest improvements A novel insight, as it unveils a previously unrecognized perspective with transformative potential A comparative insight, as it draws parallels with established methods in different contexts A confirmatory insight, as it validates existing strategies with more robust data

A novel insight, as it unveils a previously unrecognized perspective with transformative potential

Per the textbook, which scenario is an example of leveraging same-side exchange benefits? A company expanding its operations to another country. A social media platform becoming more valuable as more friends join and connect. A tech firm acquiring a smaller start-up for its intellectual property. A service provider offering discounted upgrades to existing users.

A social media platform becoming more valuable as more friends join and connect.

Per the textbook, what does the term "walled garden" refer to in the context of digital ecosystems? The practice of using firewalls in a digital system to prevent cyber-attacks and protect user data. A system where access and interactions are restricted to content, services, or applications within the confines set by the provider or platform. A scenario in online retail where customers are only shown products that match their previous shopping behaviors and preferences. The strategy of companies building virtual reality (VR) spaces for online shopping, gaming, or social interactions.

A system where access and interactions are restricted to content, services, or applications within the confines set by the provider or platform.

Per the textbook, what does "business intelligence (BI)" primarily refer to? The use of technology in businesses to intelligent systems that can replace human decision-making. A smart system used in businesses for automating customer interactions only. The process of gathering intelligence on business competitors through undercover means. A term encompassing aspects of reporting, data exploration, ad hoc queries, and sophisticated data modeling and analysis.

A term encompassing aspects of reporting, data exploration, ad hoc queries, and sophisticated data modeling and analysis.

Per the textbook, what role can APIs play in a digital ecosystem? APIs are primarily used to track the online activities of users across different platforms. APIs facilitate the integration of different services and platforms, fostering innovation and enhancing functionality across applications. They are digital certifications that all software applications need to function legally. APIs are advanced digital algorithms that predict an application's success.

APIs facilitate the integration of different services and platforms, fostering innovation and enhancing functionality across applications.

Per the textbook, what accurately encapsulates the concept of "Big Data"? An expansive term indicating vast, often unstructured data, surpassing traditional database handling capacities, critical for modern managerial tasks. Refers primarily to extensive data sets, necessitating exceptional computational prowess for effective parsing and utilization. Pertains to sizable data compilations, demanding distinct protocols and mechanisms for ethical and regulatory conformity. Denotes data collections with intrinsic commercial worth, representing potential market commodities.

An expansive term indicating vast, often unstructured data, surpassing traditional database handling capacities, critical for modern managerial tasks.

Per the textbook, in a network, what defines same-side exchange benefits? Equal exchange rates for international transactions. Similar benefits for users regardless of their market side. The ability to exchange products with other users. Increased value from the interaction between users on the same side of the market.

Increased value from the interaction between users on the same side of the market.

How does Social Network Analysis contribute to understanding social media platforms? By analyzing the relationships and information flow within networks. By determining the most popular content categories. By quantifying the financial profitability of different platforms. By evaluating the effectiveness of advertisement placements.

By analyzing the relationships and information flow within networks.

Per the textbook, how do congestion effects challenge the principles of network effects? By overwhelming new users with too many feature choices. By leading to legal disputes over network bandwidth usage rights. By deteriorating user experience when scaling leads to system overloads or resource constraints. By causing physical traffic jams during product launches in retail stores.

By deteriorating user experience when scaling leads to system overloads or resource constraints.

Per the textbook, which factor contributes most directly to a product's stronger staying power in the market due to network effects? Increasing value as more users join the network. Frequent updates and bug fixes. Extensive offline marketing campaigns. Availability in multiple languages.

Increasing value as more users join the network

Which factor is less relevant to the success of platform businesses compared to traditional models? Economies of scale Data-driven decision-making Cross-platform compatibility User interaction and engagement

Economies of scale

What is a fundamental characteristic of a business ecosystem in terms of competition? Entities form alliances to completely eliminate external competition and control pricing. Entities engage in fierce competition, with the goal of establishing a monopoly within the ecosystem. Entities within the ecosystem collaborate, compete, and co-create products or services. Collaboration is discouraged to prevent conflicts of interest and ensure distinct market segments.

Entities within the ecosystem collaborate, compete, and co-create products or services.

What significant shift was facilitated by the transition from Web 1.0 to Web 2.0? The reduction in social media platforms. The transition from digital to analog content. From a read-only web to an interactive web. The limitation of content creation to professionals.

From a read-only web to an interactive web.

Per the textbook, what advantage does moving early in a market offer to technology companies? It allows the company to delay product development until market trends are clear. It ensures that the company's staff gain experience before the market evolves. It allows a company to establish a strong network base and set industry standards. It ensures the company has the first pick of physical office locations.

It allows a company to establish a strong network base and set industry standards.

Per the textbook, why is being compatible with the leading network important for new tech products? It prevents the product from receiving negative reviews. It increases the product's visibility on e-commerce platforms. It allows for easier user adoption and interoperability with popular systems. It ensures the product can be legally sold in most regions.

It allows for easier user adoption and interoperability with popular systems.

Per the textbook, what role does "social proof" play in the adoption of a new technology or platform? It offers proof of concept for potential investors. It involves celebrity endorsements for better market positioning. It ensures that the platform is compliant with social networking policies. It builds user trust through the visible approval of other users or authoritative figures.

It builds user trust through the visible approval of other users or authoritative figures.

Per the textbook, what is the primary advantage of a platform having high "switching costs"? It encourages competition between existing platforms. It discourages users from moving to competing platforms. It enables platforms to charge users more for premium services. It allows platforms to switch between different market strategies rapidly.

It discourages users from moving to competing platforms.

Per the textbook, why is content adjacency important in digital advertising? It allows for ads to be randomly placed, providing equal exposure across various content. It ensures that ads are placed next to related content, increasing the relevance and likelihood of consumer engagement. It prioritizes text-based content for ad placements, avoiding multimedia content. It focuses on placing ads next to the most popular content, regardless of relevance.

It ensures that ads are placed next to related content, increasing the relevance and likelihood of consumer engagement.

Within digital platforms, "multi-homing" refers to a scenario where users or providers engage with multiple platforms instead of committing to just one. What is the primary implication of multi-homing for platform competition? It intensifies competition, as platforms must continuously innovate and improve user experience to maintain engagement. It decreases overall market value, as divided user attention reduces the revenue potential for each platform. It encourages monopolistic practices, as platforms seek to buy out competitors to control user bases. It leads to market consolidation, as users tend to engage more with one platform, leading others to diminish.

It intensifies competition, as platforms must continuously innovate and improve user experience to maintain engagement.

What is true about Fabricated Content? It is genuine content taken out of context. It is completely false content, designed to deceive and do harm. It is true information presented in a misleading way. It involves altering imagery to deceive.

It is completely false content, designed to deceive and do harm.

Per the textbook, what characterizes data as being "unstructured"? It is not organized in a pre-defined manner or does not follow a specific format. It lacks legal structures for privacy and security regulations. It is scattered across various digital platforms and cannot be gathered into one place. It consists of numbers and statistics without any accompanying analysis or interpretation.

It is not organized in a pre-defined manner or does not follow a specific format.

What does it mean if an insight is described as "novel" in the context of business analytics? It is based on newly gathered data. It pertains to innovative technology only. It is unrelated to current business objectives. It provides a new understanding or perspective previously unrecognized.

It provides a new understanding or perspective previously unrecognized.

Per the textbook, why is "Leveraging Backward Compatibility" a strategic move for technology companies? It enables companies to recycle unsold products with minimal upgrades. It reassures users that their current investments and data will remain valuable and usable. It provides an excuse for companies to not invest in new technologies. It allows companies to minimize research and development expenditures.

It reassures users that their current investments and data will remain valuable and usable.

Per the textbook, how does subsidizing adoption influence a new technology's market penetration? It increases the company's reliance on government subsidies. It discourages competition by creating a price-inflated market. It dilutes the brand's perceived value by associating it with discounts. It reduces initial barriers for users, encouraging rapid adoption and strengthening network effects.

It reduces initial barriers for users, encouraging rapid adoption and strengthening network effects.

What is a traditional pipeline business model primarily characterized by? Linear flow of value through creation & distribution Multiple points of value creation interacting in a network Circular flow of resources and information Decentralized production with independent value creation

Linear flow of value through creation & distribution

What is the primary difference between supply-side and demand-side economies of scale? Supply-side economies are exclusive to technological firms, while demand-side are not. Supply-side relates to the user base size, while demand-side relates to the number of suppliers. Network effects are specific to demand-side economies of scale. Demand-side economies are always positive, while supply-side can be negative.

Network effects are specific to demand-side economies of scale.

In terms of value creation, how do platform businesses differ from pipeline businesses? Platforms focus on single transactions, pipelines on customer relationships Platforms rely on fixed supply chains, while pipelines are flexible Platforms prioritize offline growth, while pipelines focus on online expansion Platforms create value by enabling interactions, while pipelines do so through a series of steps

Platforms create value by enabling interactions, while pipelines do so through a series of steps

Per the textbook, how do "stronger staying power" and "network effects" relate in the context of digital platforms? Staying power and network effects are typically seen as mutually exclusive strategies. Network effects reduce the need for a platform's staying power. Stronger staying power refers to the platform's physical durability, not network effects. Platforms with stronger staying power attract more users, reinforcing network effects.

Platforms with stronger staying power attract more users, reinforcing network effects.

Which type of analytics anticipates future trends based on historical data? Diagnostic analytics. Predictive analytics. Descriptive analytics. Real-time analytics.

Predictive analytics.

Which technique is commonly used to address overfitting in decision trees? Increasing the size of the dataset tenfold Making the tree deeper by adding more levels Ignoring the validation set while training Pruning the tree to remove unnecessary branches

Pruning the tree to remove unnecessary branches

Which of the following is an essential characteristic of valuable insights in business analytics? Complexity of the data used in the analysis. The volume of data points considered. The age of the data used for analytics. Relevance to the business's goals or challenges.

Relevance to the business's goals or challenges.

Per the textbook, what is a defining characteristic of a two-sided market? Two types of products are available in the market. The market consists of two dominant service providers. The platform facilitates interactions between two distinct user groups, creating value. The market operates in two different countries.

The platform facilitates interactions between two distinct user groups, creating value.

What is the primary advantage of using collective intelligence over individual expertise? Reduced need for specialists. Decreased reliance on technology. The potential for more informed and diverse perspectives leading to better decisions. Faster decision-making processes.

The potential for more informed and diverse perspectives leading to better decisions.

What factor primarily drives the concept of demand-side economies of scale? The increase in user demand leading to network effects. The diversification of products to cater to multiple segments of the market. The reduction in production costs as more units of a product are manufactured. The expansion into global markets to increase demand for products and services.

The increase in user demand leading to network effects.

In decision tree analysis, what does 'root node' represent? A leaf at the bottom of the tree The initial decision point from where the tree splits The physical location where the decision is made The final outcome of the decision process

The initial decision point from where the tree splits

Per the textbook, what is "convergence" in the context of digital platforms? The reduction of digital platforms in the market due to economic downturns. The decision by a platform to operate in both digital and physical markets. The collaboration between competing platforms for mutual benefits. The tendency for different technologies to evolve toward performing similar tasks.

The tendency for different technologies to evolve toward performing similar tasks.

What is the primary goal of purity measures in the context of decision trees? To ensure that each node represents a single class as accurately as possible To increase the computational complexity of the tree-building process To maximize the depth of the tree To handle missing data within nodes

To ensure that each node represents a single class as accurately as possible

How do platforms within a business ecosystem typically think about their growth? They diversify into unrelated industries to hedge against market volatility. They consider how to create a broader ecosystem beyond their core product. They aim to monopolize the market by acquiring smaller, potential competitors. They focus on aggressive marketing to outperform competitors in the same industry.

They consider how to create a broader ecosystem beyond their core product.

What role do complementors play in a business ecosystem? They reduce the overall cost of services by offering cheaper alternatives to users. They handle the legal aspects of the ecosystem, ensuring compliance with regulations. They mediate disputes within the ecosystem, ensuring smooth interactions between entities. They support growth by increasing users' switching costs and extending the platform's value proposition.

They support growth by increasing users' switching costs and extending the platform's value proposition.

In machine learning, why are training data and test data used differently? Training data provides real-time data updates for deployed models, while test data is used for offline analysis. Training data determines the user interface of machine learning applications, while test data manages the backend processing. Training data helps the model learn during the development phase, while test data helps evaluate the model's performance and predictiveness on data it hasn't seen before. Training data is used for visualizing data patterns before the model development, while test data is used for system hardware optimization. Previous QuestionPreviousNext QuestionNext

Training data helps the model learn during the development phase, while test data helps evaluate the model's performance and predictiveness on data it hasn't seen before.

In the realm of digital platforms, the phenomenon of "multi-homing" is often observed. What best describes the practice of multi-homing? Platforms create interconnected home environments for users, enhancing the digital ecosystem. Platforms offer a diverse range of home-based services to ensure user convenience and retention. Users or providers actively engage in and maintain presence across multiple competing platforms concurrently. Users migrate from one digital residence to another, seeking better features or pricing.

Users or providers actively engage in and maintain presence across multiple competing platforms concurrently.

Per the textbook, what fundamental concept is critical for the growth of platforms like Facebook, WhatsApp, and Twitter? Focusing on isolated market demographics. Limiting user communication capabilities. Restricting access to platform resources. Utilizing network effects.

Utilizing network effects.

What metaphor is often used to describe the traditional pipeline business model? Water flowing through a pipe Bridges connecting islands Web of interconnected nodes Spokes on a wheel Previous QuestionPreviousNext QuestionNext

Water flowing through a pipe