Introduction to Electronic Commerce, 3e (Turban)

Chapter 5 B2B Electronic Commerce

True/False

1. B2B only includes electronic transactions between businesses conducted over the public
Internet.
T/F

2. The availability of a secure broadband Internet platform is one of the key drivers of B2B EC.
T/F

3. B2B EC transactions that involve one seller selling to many buyers is called an exchange.
T/F

4. In one-to-many and many-to-one markets, if one company does all of the selling it is called a
buy-side market.
T/F

5. In company-centric marketplaces, the individual company has very little control over who
participates in selling or buying transactions.
T/F

6. Exchanges are usually owned and run by a third party or by a consortium.

T/F

7. Businesses deal with other businesses for purposes beyond just selling or buying. One
example is that of collaborative commerce, which is communication, design, planning, and
information sharing among business partners.
T/F

8. An online intermediary is an online third party that brokers a transaction online between a
buyer and a seller.
T/F

9. Spot buying refers to the purchase of goods and services according to a schedule, usually at
prevailing market prices that are determined by supply and demand.
T/F

10. Stock exchanges and commodity exchanges are examples of spot buying.
T/F

11. Strategic sourcing refers to purchases involving long-term contracts that usually are based on
private negotiations between sellers and buyers.
T/F
12. Two examples of direct materials for a food processing company are computers and
communication devices.
T/F

13. MRO refers to indirect materials used in activities that support production.
T/F

14. Horizontal marketplaces are markets that concentrate on a service, material, or a product that
is used in all types of industries.
T/F

15. B2B EC can increase the efficiency and effectiveness of supply chains or dramatically
change the supply chain by eliminating one or more intermediaries.
T/F

16. Sell-side is a major type of B2B structural model.

T/F

17. B2C and B2B orders have similar order-fulfillment processes and pricing models.
T/F

18. Maverick buying is the planning, organizing, and coordinating of all the activities pertaining
to the purchasing of the goods and services necessary to accomplish the mission of an
enterprise.
T/F

19. E-procurement methods include bartering, catalogs, and banners.

T/F

20. C-commerce is moving ahead at a very rapid pace.

T/F
Multiple Choice

1. Key business drivers for B2B include each of the following except

A) the availability of a secure broadband Internet platform.

B) numerous private and public B2B e-marketplaces.
C) the willingness of companies to incur higher costs to improve collaboration.
D) the need for collaboration between suppliers and buyers.

2. B2B transactions involving communication, design, planning, information sharing, and

activities beyond financial transactions among business partners describes

A) exchanges.
B) collaborative commerce.
C) trading communities.
D) public marketplaces.

3. ________ is an online third party that brokers B2B transactions between a buyer and seller.

A) Strategic source
B) Horizontal marketplace
C) Vertical marketplace
D) Online intermediary

4. The purchase of goods and services as they are needed, usually at prevailing market prices is
referred to as

A) direct materials.
B) consolidation.
C) spot buying.
D) strategic sourcing.

5. The two types of materials and supplies traded in B2B are

A) digital and physical.

B) direct and indirect.
C) horizontal and vertical.
D) commodities and nonproduction.

6. Nonproduction materials, such as office supplies, that support production are called

A) indirect materials.
B) operational materials.
C) direct materials.
D) virtual materials.
7. Markets that deal with one industry or industry segment are

A) supply chain markets.

B) vertical marketplaces.
C) horizontal marketplaces.
D) production chain marketplaces.

8. Major B2B services include each of the following except

A) travel and hospitality services.

B) financial services.
C) real estate.
D) retail.

9. Which of the following is not one of the major benefits of B2B?

A) expedites processing and reduces cycle time

B) enables customized online catalogs with the same prices for different customers
C) increases production flexibility, permitting just-in-time delivery
D) increases opportunities for collaboration

10. All are benefits of B2B except

A) B2B creates new sales or purchase opportunities.

B) B2B eliminates paper and reduces administrative costs.
C) B2B increases channel conflict.
D) B2B lowers search costs and time for buyers to find products and vendors.

11. ________ occurs when B2B eliminates a distributor or a retailer.

A) Disintermediation
B) Channel conflict
C) Just-in-time delivery
D) Collaboration
12. Each of the following is a major type of B2B structural model except

A) exchanges.
B) collaborative union.
C) sell-side.
D) buy-side.

13. Which of the following is a Web-based marketplace in which one company sells to many
business buyers from e-catalogs or auctions, frequently over an extranet?

A) sell-side e-marketplace
B) buy-side marketplace
C) supermarket
D) social network

14. Companies will usually separate B2C orders from B2B orders because B2C and B2B orders
have different

A) buying and delivery processes.

B) accounting and financial processes.
C) marketing processes.
D) order-fulfillment processes and pricing models.

15. Each of the following is a major marketing method for the B2B one-to-many model except

A) electronic catalogs.
B) forward auctions.
C) one-to-one selling.
D) reverse auctions.

16. Companies use ________ to sell their unneeded assets for quick disposal or to dispose of
excess, obsolete, and returned products.

A) private auctions
B) liquidation
C) reverse auctions
D) forward auctions

17. Benefits of forward auctions to B2B sellers include

A) revenue generation.
B) cost savings.
C) increased stickiness.
D) all of the above.
18. Benefits of using a third-party hosting company for conducting B2B auctions instead of
developing an auction site in-house include each of the following except

A) no hiring costs.
B) no redeployment of corporate resources.
C) reducing time-to-market to several weeks.
D) no additional resources are needed.

19. A corporate-based acquisition site that uses reverse auctions, negotiations, group purchasing,
or any other e-procurement method best defines

A) desktop procurement method.

B) buy-side e-marketplace.
C) intermediary marketplace.
D) aggregated catalog vendor.

20. The aggregated catalogs of all approved suppliers combined into a single internal electronic
catalog describes

A) bartering exchange.
B) buy-side e-marketplace.
C) sell-side e-marketplace.
D) internal procurement marketplace.

21. An example of a successful aggregation of suppliers' catalogs is that of ________, which

aggregates more than 10,000 items from the catalogs of approved suppliers into an internal
electronic catalog.

A) MasterCard International
B) Amazon.com
C) Google
D) Priceline.com

22. The primary purpose of group purchasing is to

A) generate revenues from membership fees.

B) expedite just-in-time delivery.
C) negotiate better prices.
D) acquire exclusive rights to products.

23. Which of the following is a group purchasing model?

A) consortium
B) internal collaboration
C) forward auction
D) internal aggregation
24. With a bartering exchange, a company submits its surplus to the exchange and receives

A) points of credit, which the company can then use to buy items that it needs.
B) an equivalent amount of products or services.
C) interest payments until it buys something from the exchange.
D) cash minus a small commission for services.

25. Each of the following is true about dynamic pricing except

A) anonymity often is a key ingredient.

B) buyers and sellers interact with bids and offers in real time.
C) e-malls are a prime example of this pricing model.
D) a deal is struck when there is an exact match between a buyer and a seller on price,
volume, and other variables, such as location or quality.