Smart Card Overview

Smart cards are used by millions of cardholders worldwide and are at work processing
point-of-sale transactions, managing records, protecting computers, and securing
facilities. With the latest data breaches, smart card technology is becoming more
important than ever. It is also a great technology to increase the security of the Internet
of Things (IoT) on it way to the Internet of Trusted Things (IoT2).

Click here for more about smart card technology.

Smart Card Evolution
Information technology is evolving at an amazing pace. Personal computers, fax
machines, pagers, PDAs, and cell phones are in the hands of millions of people
worldwide.

Smart card history reaches back to the last millennium. In the 1990s demand in this
technology soared to secure offline credit card transactions. Since then the number and
variety of smart card-based applications have increased around the world.
Some factors driving the growing interest in smart cards include the declining cost of
smart cards and the growing concern that magnetic stripe cards cannot provide the
protections necessary to thwart fraud and security breaches. The security issue alone
may propel smart card technology to the forefront of business transactions.

Types of Smart Cards

The term “smart card” is loosely used to describe any card that is capable of relating
information to a particular application such as magnetic stripe cards, optical cards,
memory cards, and microprocessor cards. It is correct, however, to refer to memory and
microprocessor cards as smart cards.

 Magnetic stripe cards. A magnetic stripe card has a strip of magnetic tape
material attached to its surface. This is the standard technology used for bank
cards and can only store data which cannot be updated.
 Optical cards. Optical cards use some form of laser to read and write to the
card.
 Memory cards. Memory cards can store a variety of data, including financial,
personal, and specialized information, but cannot process information.
 Microprocessor cards. Smart cards with microprocessors look like standard
plastic cards, but are equipped with an embedded Integrated Circuit (IC) chip
and card OS. They can store information, carry out local processing on the data
stored, and perform complex calculations. These cards take the form of either
“contact” cards (which require a card reader) or “contactless” cards (which use
radio frequency signals to operate).
The Microprocessor Smart Card
The microprocessor smart card is defined as an IC chip contact card with a
microprocessor and memory. The size of a credit card, this smart card contains a dime-
sized microchip that can process and store thousands of bits of electronic data. Unlike
passive devices (such as a memory card or magnetic stripe card) that can only store
information, the microprocessor smart card is active and able to process data in
reaction to a given situation.

This capability to record and modify information in its own non-volatile, physically
protected memory makes the smart card a powerful and practical tool – smart cards are
small and portable, they can interact with computers and other automated systems, and
the data they carry can be updated instantaneously.

Applications
First introduced in Europe nearly three decades ago, smart cards debuted as a stored value tool for
payphones to reduce theft. As smart cards and other chip-based cards advanced, people found new
ways to use them, including charge cards for credit purchases and for record keeping in place of
paper.

In the U.S., consumers have been using chip cards for everything from visiting libraries to buying
groceries to attending movies, firmly integrating them into our everyday lives. Several U.S. states
have chip card programs in progress for government applications ranging from the Department of
Motor Vehicles to Electronic Benefit Transfers (EBTs). Many industries have implemented the power
of smart cards in their products, such as the GSMdigital cellular phones as well as TV-satellite
decoders.

Why Smart Cards

Smart cards improve the convenience and security of any transaction. They provide tamper-proof
storage of user and account identity. Smart card systems have proven to be more reliable than other
machine-readable cards, like magnetic stripe and barcode, with many studies showing card read life
and reader life improvements demonstrating much lower cost of system maintenance. Smart cards
also provide vital components of system security for the exchange of data throughout virtually any
type of network. They protect against a full range of security threats, from careless storage of user
passwords to sophisticated system hacks. The costs to manage password resets for an organization
or enterprise are very high, thus making smart cards a cost-effective solution in these
environments. Multifunction cards can also be used to manage network system access and store
value and other data. Worldwide, people are now using smart cards for a wide variety of daily tasks,
which include:

Electronic Data Interchange

Electronic data interchange (EDI) is defined as the inter-process communication (computer application to
computer application) of business information in a standardized electronic form. In short, EDI
communicates information for business transactions between the computer systems of companies,
government organizations, small businesses, and banks.
Using EDI, trading partners establish computer-to-computer links that enable them to exchange
information electronically. This allows businesses to better cope with a growing avalanche (too many) of
paperwork: purchase orders, invoices, confirmation notices, shipping receipts, and other documents. With
the aid of EDI, all these documents are in electronic form, which aliases more work automation to occur
and even alters the way business is done.
The primary benefit of EDI to business is a considerable reduction in transaction costs, by improving the
speed and efficiency of filling orders. Studies show that it takes up to five times as long to process a
purchase order manually as it does electronically.

EDI Layered Architecture

Electronic data interchange architecture specifies four layers: the semantic (or application) layer,
the standards translation layer, the packing (or transport) layer, and the physical network
infrastructure layer as shown in figure below.

fig: Layered Architecture of EDI

The EDI semantic layer

It describes the business application that is driving EDI. For a procurement application, this
translates into requests for quotes, price quotes, purchase orders, acknowledgments, and
invoices. This layer is specific to a company and the software it uses. In other words, the user
interface is customized to local environments.

EDI Standard Layer

The information seen at the EDI semantic layer must be translated from a company-specific form
to a more generic or universal form so that it can be sent to various trading partners, who could
be using a variety of software applications at their end. To achieve this, companies must adopt
universal EDI standards that lay out the acceptable fields of business forms. What complicates
matters is the presence of two competing standards that define the content and structure of EDI
forms: the X12 standard, developed by the American National Standards Institute (ANSI), and
EDIFACT, developed by United Nations Economic Commission for Europe (UN /ECE).

EDI Transport Layer

When the trading partner sends a document, the EDI translation software converts the proprietary
format into a standard mutually agreed on by the processing systems. When a company receives
the document, their EDI translation software automatically changes the standard format into the
proprietary format of their document processing software so that the company can manipulate
the information in whatever way it chooses to.

Physical Layer
Dial-up lines, Internet, value added network, etc.

EDI Envelope: Digital Information Package

EDI Envelope serves to deliver electronic transactions to a receiving company’s business system. EDI
Envelope can include multiple business transaction sets in the same way multiple paper purchase
order documents can be physically grouped, stuffed, and mailed together to a receiver. EDI Envelope
is the digital package that contains EDI documentation to be sent to trading partners. EDI Envelope is
presented in three different types representing different levels of digital packaging. These include
transaction set, group, and interchange envelopes, the last of which is the largest envelope comprised
of the smaller groups of transaction sets.

Sometimes when we want to imaging the structure of an EDI document we can think about common
paper documents that are packed in an envelope. The upper envelope (ISA/IEA Envelope) contains
one or more envelopes (GS/GE Envelopes) in which documents are placed. Each document is in a
separate EDI Envelope (ST/SE Envelopes).

The addresses of sender and receiver are “written” on ISA/IEA envelopes.

The type of documents “packed” are “depicted” on EDI Envelope GS/GE. This envelope contains only
the documents of similar type – Purchase Orders, Invoices etc. Also it can be “written” on an envelope
to which company-receiver division these documents refer. The last envelope contains the end-
documents, e.g. Purchase Orders 000000123 and 000000124.
Some advantages of doing business online or on the
internet.
1. It’s not expensive to start an online business.
If you start an offline business, then you need to invest, normally, a lot of money, but
when starting an online business you do not need to make a big investment. It is
possible to even start your online business with absolutely no investment at all! All you
need are, hosting and a domain name, you can get these things for free here.
So, you can start your own online business without spending a single penny. This
means that you can have success without dealing with all the financial hurdles and risks
that are often associated with running a business the traditional offline route.

2. Marketing is also Free.

This is another important benefit of doing business online. For an offline business, you
may have to pay a lot of money in order to promote your product, placing adverts in the
press, etc. You can promote your online business without any cost, with good search
engine optimization, businesses can quickly be found by customers searching for their
products and services. You can also use social media websites (facebook, twitter) and
other websites in your niche to promote your products for free.
3. You can sell while you sleep.
This is perhaps the biggest advantage of doing business online, your website is not only
available 24 hours per day, but also available to everyone 365 days a year. When doing
business online, there are no time restraints. A website never closes, you will be getting
online orders even when you are sleeping.

4.There are no borders to online business.

Selling online allows your business to reach a wider audience. Any person with an
internet connection can access to your website. The globe is your limit.

5.Online business is also environment-friendly.

You can also prove yourself a nature lover by doing online business. Working online
from your own home means less petrol usage and less paperwork (better for the
environment). This is another benefit of doing business online.

6. It’s easy to track what works and what doesn’t.

Unlike traditional publicity campaigns, you can get very accurate reports to see how
customers found you and what pages they look at on your website. You can also collect
contact information that helps you target new business.

7.It’s cheap and easy to keep in touch with customers.

You can use newsletters and email marketing to communicate with your existing
customers and potential new customers who have given you their email address. This is
cheaper than traditional advertising mediums and also, as they know your name your
message will be noticed in their inbox.
On your site, you can provide additional forms of communication like live chat, forums or
a question form. This leads to better customer service and also increased efficiency.

The social media channels, like Twitter and Facebook, also provide another way of
keeping in contact with your clients.

8.Manage your business from anywhere in the world.

You can access to your business from any corner of the world, you’re not tied to your
office location to manage your business.

9.Financial transactions are much easier and faster.

Transferring money can be managed from any mobile device. Services like PayPal can
transfer money to nearly anyone we choose in the world. Using different currencies isn’t
a problem, these services can convert different currencies into the currency of your
choice.

So, we can see from the businesses point of view there are numerous advantages of
doing business online.

Some disadvantages of doing business online or on

the internet:
1.Potentially Lower Profit Margins
The internet has upped the market for many different types of businesses. Although this has made it
easier for customers to access your products and services, the internet has also made it easy for
customers to access the products and services of your competitors, as well. To be at the forefront of
customers' minds, businesses have resorted to slashing prices drastically, which has also drastically
reduced profit margins. If you conduct your business on the internet, prepare to lose sales if
customers can find the same product on the market at a lower cost.

2.Reduced Physical Interactions

Some of the most creative ideas are borne out of the face-to-face interactions that people have with
one another. While the internet has succeeded in connecting people to one another in a superficial
way, it cannot adequately replicate the human interactions of interacting face-to-face with colleagues
and customers.

3.Negative Reviews
People now take to social media to voice their concerns and their viewpoints about a business.
People are more likely to complain than they are to compliment a business, and this can damage the
reputation of a company. Plenty of examples can be found of complaints that have gone ‘viral’ and
that have forced businesses to change their strategies or change their products, resulting in a loss of
revenue.

The internet is a powerful tool not only for businesses but also for consumers. Handle it with care
and in accordance with the needs and model of your business, so that the advantages are
maximized and that the disadvantages can be mitigated.

Scope Of E - Commerce In The World Of Today!

World is remarkably advancing n technology and it is expected that within
couple of more years, technology will be calculating on our entire life. World
Wide Web and other numerous computer networks are also the outcomes of
this proceeding global knowledge.

E-commerce Solutions are magnifying our range of shopping experiences.

Predominantly, it is engaging people to get everything through online access
without any fatigue of taking out time from the busy routines and visiting the
stores. The biggest advantage of E-commerce solutions, due to the Internet
service which is the most captivating tool for reaching the markets working
throughout the globe is facilitating beyond the geographical premises.

Due to the electronic conduction of trade has tremendously resulted in more

widespread business. E-commerce is a great opportunity for the coming across
new things and services. There are so many options to choose from which help customer to experiment more things.
Alternative of everything is available in the world of E-commerce solutions. The diverse profile of E-commerce
solutions encompasses every type of service and commodity. At your place, you can easily search for any
information related to the queries you got.

As per from its business point of view, E-commerce Solutions offers a well-established access to the core
customers within low investment amount for selling and purchasing purposes. By utilizing the source of email
addresses and numerous online advertising strait, E-commerce helps you to gain a stable marketing position to
influence people.

With the growing popularity of internet, E-commerce is also holding its firm position among the customers. As a
method of marketing, E-commerce Solutions is a great invitation for the people who love shopping. As per
abbreviation, E-commerce stands for Electronic Commerce which actually means marketing through digital media. E-
commerce solutions is carried out through various channels such as online catalog, fax, file transfer protocol,
shopping carts, email, electronic data exchange and web services. Using electronic networks, the processes of E-
commerce are done. As per round-the-clock services, consumers and marketers are mutually benefitted.

Internet provides accessibility to people from all around the world which infers in being profitable for the business.
Success of e-commerce solutions lies within the versatility it holds in its offers. Agencies opportune the clients
companies to get an outclass position among its competitors. Largely due to the eminent distribution and less
resource input in case of services and commodities, help purchasers to enjoy incredible shopping experience.

What is Trust And Its Role in eCommerce?

Understanding the nature of Trust is important. The problem with common words like
‘trust’ is that we all believe we understand it. ‘Trust’ in at least that sense, is taken for
granted. That makes it all the more critical to establish a meaning that we understand
the same way – a common frame of reference, if you will.

Mayer et al (1995) explains trust this way:

The willingness of a party to be vulnerable to the actions of another party based on the
expectation that the other will perform a particular action important to the trustor,
irrespective of the ability to monitor or control that other party.

As an emotion, trust has various other aspects – social, psychological, economical,

philosophical – as detailed upon by Wikipedia.

Three factors contribute to the state of trust: the chance for gain, chance for a loss and
an uncertainty regarding the matter.

Let me bring this blog article itself into context. The expected gain from this article is
deriving actionable knowledge about how to improve the trust factor on your
eCommerce website. The potential loss is of time that could be used doing something
else. The uncertainty is if the article will provide the value or not.
 So if you are still reading this article, it means that you perceive that the probability of
gain (knowledge, insights) is more than the probability of loss (time, opportunity cost)
even though you really can’t be certain. Thanks for trusting us, we won’t disappoint.

It’s important to understand that trust is not a choice, but an underlying psychological
state that can be influenced.
In the context of eCommerce, trust is as big a factor as anything. The reason a user
decides to visit your page is because of trust. Every conversion that occurs on an
eCommerce page is a result of trust. Conversion Rate Optimization experts concern
themselves with these problems:

 Increasing motivation
 Reducing anxiety
 Reducing friction
Improving the trust factor of your website helps with each of these endeavors.

Ways to Improve Customer

Trust on Ecommerce Sites

1. Make It Easy For Customers

You have to prove that your product or service is incredible if you
want to build a base of loyal customers. But to prove that, you
need them to take a chance on your product in the first place.

So, make it easy for them.

The best brands make it very easy to buy one thing. They have
what’s called a “hero product.” For example, Allbirds started out
with one very basic sneaker. It came in a handful of colors, and
customers simply chose a color and proceeded to checkout.
It’s really important not to overwhelm people with choice when
starting a new company, because that causes confusion. People
don’t know what to buy. Instead of taking a chance on you, they
revert to what they know.

2. Focus On Simplicity
Simplicity isn’t just a good strategy for getting people to buy your
initial offerings, it’s also a smart tactic to use when advertising to
them.

Keep your ads simple. Use the same messaging over and over in
slightly different ways. People don’t respond to an ad the very first
time they see it or hear it. It takes repetition to build interest.

So, use the same tagline over and over. Figure out how to say what
differentiates you in just a few sentences, and keep driving that
home. Don’t get bored with those core differentiators, because the
repetition will pay off down the road.

3. Find A Niche
Early on at ThirdLove, we realized that our core demographic
listened to certain podcasts. So, we got into that space and created
a buzz, reaching our customers through influencers in a
community that they trusted.

At that time, podcasts weren’t a widely recognized channel for

advertising. But our core demographic was listening to them, and
it ended up being the perfect niche for us. We were able to reach
our customers in a really unique way, speaking directly to them
through the podcast hosts.
But remember, you have to be ready to do more than just buy ads.
You have to establish a sense of trust to go along with the buzz you
create.

4. Establish Trust
A couple years ago, we were working with one of these podcast
agencies and advertising on a show. Actress Heather McDonald,
the voice of the podcast, was recording an ad for our bras. But
during the recording, the owner of the agency was sexually
harassing her — and it was all caught on tape.

She ended up quitting, and the story started to blow up online. We

walked into work the next day and discovered that ThirdLove was
caught up in the middle of this controversy. So, naturally, we
pulled our advertising from the agency. But we also went on
Twitter to support this woman and voice our opinion about what
had happened.

This is a perfect example of why, and how, you can develop trust as
a brand. If you are putting yourself in a certain community, you
have to take a certain amount of responsibility. You have to show
you care about your customers and that community. Loyalty and
trust go both ways.

5. Build A Strong Customer Service Team

Customers don’t return to a company that breaks promises. Show
your customers you really mean what you say in your ads. The best
way to do that?

Build a customer service team that can truly take care of your
customers.
Unhappy customers can still become loyal ones if you address
their needs. Find them the right size. Make exchanges easy.
Communicate quickly and professionally. People just want to see
you keep promises.

Remember, getting someone to buy from you once doesn’t mean

they’ll be long-term customers. Immediate up-selling, poor
customer service, and broken promises will keep that customer
from coming back, no matter how good your product. So, keep
these strategies in mind while you’re trying to build that base of
loyal customers — and always keep your word.

MCQ OF ECOMMERCE

Set 1

1) Which products are people most likely to be more uncomfortable buying on the Internet?
A. Books
B. Furniture
C. Movies
D. All of the above
2) Encryption can be done
A. only on textual data
B. only on ASCII coded data
C. on any bit string
D. only on mnemonic data
3) Which term represents a count of the number of people who visit one site, click on the ad, and are taken
to the site of the advertiser?
A. Affiliate programs
B. Click-through
C. Spam
D. All of the above

4) EDI standard
A. is not easily available
B. defines several hundred transaction sets for various business forms
C. is not popular
D. defines only a transmission protocol
5) What encourages users of a product or service supplied by a B2C company to ask friends to join in as
well?
A. Spam
B. Viral marketing
C. Affiliate programs
D. None of the above

6) In B2B e-commerce
i) Co-operating Business should give an EDI standard to be used
ii) Programs must be developed to translate EDI forms to a form accepted by application program
iii) Method of transmitting/receiving data should be mutually agreed
iv) It is essential to use internet
A. i and ii
B. i, ii and iii
C. i, ii, iii and iv
D. ii, iii and iv

7) Compared to B2C e-commerce, B2B e-commerce is …….

A. of equal size
B. slightly smaller
C. slightly larger
D. much larger

8) All of the following are techniques B2C e-commerce companies use to attract customers, except
A. Registering with search engines
B. Viral marketing
C. Online Ads
D. Virtual marketing

9) A hashing function for digital signature

i) must give a hashed message which is shorter than the original message
ii) must be hardware implementable
iii) two different messages should not give the same hashed message
iv) is not essential for implementing digital signature
A. i and ii
B. ii and iii
C. i and iii
D. iii and iv

10) In the e-commerce security environment, which of the following constitutes the inner-most layer?
A. people
B. data
C. technology solutions
D. organizational policies and procedures
11) The digital product delivery internet business model
A. concentrates information about products and services from multiple providers at one central point.
B. provides an electronic clearinghouse for products where price and availability are constantly changing,
sometimes in response to customer actions.
C. enables groups of people who want to purchase a particular product to signup and then seek a volume
discount from vendors.
D. sells and delivers software, multimedia, and other digital products over the internet.
12) In Electronic cash payment
A. a debit card payment system is used
B. a customer buys several electronic coins which are digitally signed by coin issuing bank
C. a credit card payment system is used
D. RSA cryptography is used in the transactions

13) All of the following are metrics for e-mail campaigns except…..
A. open rate
B. delivery rate
C. bounce-back rate
D. cart conversion rate

14) All of the following are advantages of using an intranet Except

A. cross-platform capability
B. security restrictions so employees cannot access the company network from home
C. open standards
D. reduced hardware and software costs

15) A person to person payment system

A. supports electronic payment for on-line and physical store purchases of goods or services after the
purchase has takes place.
B. Sends money using the web to individuals who are not setup to accept credit card payments
C. refers to digital currency that can be used for micro-payments
D. provides secure services for credit card payments on the internet

16) What is the name of the card which can be used by the buyers during the time of purchase and in which
the amount will be immediately debited from the buyers account?
A. E-Distributor
B. Debit Card
C. Credit Card
D. Power Card

17) Which of the following is not considered to be a drawback of Internet auctions?

A. market inefficiency
B. trust risks
C. fulfillment costs
D. delayed consumption costs

18) Internet virtual private networks are preferred over extra-nets for all of the following reasons Except.
A. data can be encapsulated
B. communications are kept private
C. good security
D. use of inexpensive leased phone lines

19) Set of independent Electronic Stores can be generally labeled as

A. Electronic Shopping Mall
B. Electronic Wallet
C. Electronic Stores
D. Generalized Stores
20) The two main types of Internet based B2B commerce are……
A. Net marketplaces and private industrial networks
B. EDI and collaborative commerce
C. Net marketplaces and collaborative commerce
D. EDI and private industrial networks

ANSWERS
1) B. Furniture
2) C. on any bit string
3) B. Click-through
4) B. defines several hundred transaction sets for various business forms
5) B. Viral marketing
6) B. i, ii and iii
7) D. much larger
8) D. Virtual marketing
9) C. i and iii
10) B. data
11) D. sells and delivers software, multimedia, and other digital products over the internet.
12) B. a customer buys several electronic coins which are digitally signed by coin issuing bank
13) D. cart conversion rate
14) B. security restrictions so employees cannot access the company network from home
15) B. Sends money using the web to individuals who are not setup to accept credit card payments
16) B. Debit Card
17) A. market inefficiency
18) D. use of inexpensive leased phone lines
19) A. Electronic Shopping Mall
20) D. EDI and private industrial networks

Set 2

1. The term e-commerce includes ……………………….

A) Electronic trading of Physical goods and intangibles such as information.
B) The electronic provision of services such as after sales support or online legal advice
C) All the steps involved in trade, such as on-line marketing ordering payment and support for delivery.
D) All of the above.

2. Which of the following is the largest community in classification of e-commerce?

A) Business to Business (B to B)
B) Business to Consumer (B to C)
C) Business to Government (B to G)
D) Government to Government (G to G)
3. Which of the following is not the example of business to consumer (B to C) e-commerce?
A) Amazon.com
B) e-bay.com
C) dell.com
D) lastminute.com
4. The types of Business to Business e-commerce are …………….
A) Direct selling and support to Business
B) Industry portals
C) Information sites about a industry
D) All of the above

5. Which of the following are the benefits of E-marketing?

i) Speed ii) Reach and Penetration
iii) Ease and Efficiency iv) Low Cost
v) Targeted audience
A) i, ii, iii and iv only
B) ii, iii, iv and v only
C) i, iii, iv and v only
D) All i, ii, iii, iv and v

6. …………………. is the process of recreating a design by analyzing a final product.

A) Forward Engineering
B) Reverse Engineering
C) Backward Engineering
D) None of the above

7. ……………… is simply the use of electronic means to transfer funds directly from one account to another,
rather than by cheque or cash.
A) M-Banking
B) O-Banking
C) E-Banking
D) D-Banking

8. The telephone banking service includes ……………….

i) Automatic balance voice out ii) Inquiry all term deposit account
iii) Direct cash withdraw iv) Utility Bill payments
v) Voice out last five transactions
A) i, ii, iii and v only
B) i, ii, iv and v only
C) ii, iii, iv and v only
D) All i, ii, iii, iv and v

9. Which of the following are the forms of E-banking?

i) Internet Banking ii) Telephone Banking
iii) Electronic Check conversion iv) Electronic Bill Payment
v) Direct Deposit
A) i, ii, iii and iv only
B) ii, iii, iv and v only
C) i, iii, iv and v only
D) All i, ii, iii, iv and v

10. What is the full form of SWIFT?

A) Society for Worldwide Internet Financial Telecommunications.
B) Secret Wide Interbank Financial Telecommunications
C) Society for Worldwide Interbank Financial Telecommunications
D) None of the Above

ANSWERS:
1. D) All of the above.
2. A) Business to Business (B to B)
3. B) e-bay.com
4. D) All of the above
5. D) All i, ii, iii, iv and v
6. B) Reverse Engineering
7. C) E-Banking
8. B) i, ii, iv and v only
9. D) All i, ii, iii, iv and v
10.C) Society for Worldwide Interbank Financial Telecommunications

Set 3

1) Which of the following describes e-commerce?

A. Buying products from each other
B. Buying services from each other
C. Selling service from each other
D. All of the above
2) Which of the following is a graphic display on a web page used for advertising?
A. portal
B. icon
C. banner ad
D. shopping cart

3) Which portal business model best describes Yahoo?

A. general purpose portal
B. affinity group based vertical market
C. focused content based vertical market
D. none of the above

4) Which segment is most of the media’s attention focused on?

A. B2B
B. B2C
C. C2B
D. C2C

5) Private exchanges created by companies are called

A. branded exchanges
B. local exchange
C. horizontal exchange
D. vertical exchange
6) Which of the following is not one of the benefits of e-commerce to sellers?
A. E-commerce offers greater flexibility in meeting customer needs.
B. E-commerce is a powerful tool for customer relationship building
C. E-commerce can help to reduce costs
D. E-commerce increases the net cost per contact

7) The best products to sell in B2C e-commerce are

A. Small products
B. Digital products
C. Specialty products
D. Fresh products

8) Electronic bill payment

A. supports electronic payment for on-line and physical store purchases of goods or services after the
purchase has taken place
B. sends money using the web to individuals who are not set up to accept credit card payments.
C. refers to digital currency that can be used for micro-payments
D. provides secure services for credit card payments on the internet

9) Which of the following is likely to have the lowest cost of entry?

A. an e-retailer
B. a bricks-and-mortar presence
C. a bricks-and-clicks presence
D. a traditional storefront

10) Digital products are best suited for B2C e-commerce because they
A. Are commodity like products
B. Can be mass-customized and personalized
C. Can be delivered at the time of purchase
D. All of the above
11) The type of forms that benefited the most during the consolidation period of e-commerce were ….
A. large, traditional firms
B. first movers
C. pure online companies
D. ISPs
12) A ………. is an essential component of an intranet.
A. CRM
B. LAN with a minimum of ten PCs
C. computer with server software
D. PDA

13) What is an arrangement made between e-commerce sites that direct users from one site to the other?
A. Spam
B. Viral marketing
C. Affiliate programs
D. None of the above

14) All of the following are tools for optimizing a web site’s location in search engine listings except
A. Keywords and page titles
B. identifying market niches
C. buying ads
D. bench-marking

15) A(n) ………. connects many private networks from different companies for communication through a
private inter organizational information system.
A. intranet
B. extra net
C. internet
D. WAN

16) What are materials used in production in a manufacturing company or are placed on the shelf for sale
in a retail environment?
A. Direct materials
B. Indirect materials
C. EDI
D. None of the above

17) Which of the following market entry strategies are the most common for existing firms?
A. first mover
B. fast follower
C. brand extender
D. alliances

18) A company’s e-commerce policies and consumer information privacy should be addressed in a(n)
A. information code of ethics
B. CRM
C. Information firewall
D. VPN

19) The set of marketing tools that the firm uses to pursue its marketing objectives in the target market is
called a(n)
A. Customer mix
B. Competitor mix
C. Marketing mix
D. All of the above

20) The combination of technical and legal means for protecting digital content from unlimited
reproduction without permission is known as ….
A. Digital rights management
B. Digital protection schemes
C. Digital distribution regulation
D. Digital rights protection

ANSWERS
1) D. All of the above
2) C. banner ad
3) A. general purpose portal
4) B. B2C
5) C. horizontal exchange
6) D. E-commerce increases the net cost per contact
7) B. Digital products
8) A. supports electronic payment for on-line and physical store purchases of goods or services
after the purchase has taken place
9) A. an e-retailer
10) B. Can be mass-customized and personalized
11) A. large, traditional firms
12) C. computer with server software
13) C. Affiliate programs
14) D. bench-marking
15) B. extra net
16) A. Direct materials
17) C. brand extender
18) A. information code of ethics
19) C. Marketing mix
20) A. Digital rights management

Set 4

1 By Electronic Commerce we mean:

a. Commerce of electronic goods b. Commerce which depends on electronics c.

Commerce which is based on the use of internet d. Commerce which is based on
transactions using computers connected by telecommunication network

2 For carrying out B2B e-Commerce the following infrastructure is essential: (i) World
Wide Web (ii) Corporate network (iii) Electronic Data Interchange standards (iv) Secure
Payment Services (v)Secure electronic communication link connecting businesses a. i, ii,
iii b. ii, iii, iv c. ii, iii, iv, v d. i, ii, iii, iv, v

3 For carrying out B2C e-Commerce the following infrastructure is essential (i) World
Wide Web (ii) Corporate network (iii) Electronic Data Interchange standards (iv) Secure
Payment Services (v) Secure electronic communication link connecting businesses a. i, iv
b. i, iii, iv c. ii, iii d. i, ii, iii, iv

4 For carrying out C2C e-Commerce the following infrastructure is essential (i) World
Wide Web (ii) Corporate network (iii) Electronic Data Interchange standards V.
Rajaraman/IISc. Bangalore M13/V1/July 04/1 System Analysis and Design/Electronic
Commerce Multiple Choice Questions (iv) Secure Payment Services (v)Secure electronic
communication link connecting businesses a. i and ii b. ii and iv c. i and iii d. i and iv

5 Advantages of B2C commerce are (i) Business gets a wide reach to customers (ii)
Payment for services easy (iii)Shop can be open 24 hours a day seven days a week
(iv)Privacy of transaction always maintained a. i and ii b. ii and iii c. i and iii d. iii and iv
6 B2C commerce a. includes services such as legal advice b. means only shopping for
physical goods c. means only customers should approach customers to sell d. means only
customers should approach business to buy

7 Advantages of B2C commerce to customers are (i)wide variety of goods can be

accessed and comparative prices can be found (ii) shopping can be done at any time
(iii)privacy of transactions can be guaranteed (iv)security of transactions can be
guaranteed a. i and ii b. ii and iii c. iii and iv d. i and iv V. Rajaraman/IISc. Bangalore
M13/V1/July 04/2 System Analysis and Design/Electronic Commerce Multiple Choice
Questions

8 Disadvantages of e-Commerce in India are (i) internet access is not universally

available (ii) Credit card payment security is not yet guaranteed (iii) Transactions are de-
personalized and human contact is missing (iv) Cyberlaws are not in place a. i and ii b. ii
and iii c. i, ii, iii d. i, ii, iii, iv

9 Electronic Data Interchange is necessary in a. B2C e-Commerce b. C2C e-Commerce c.

B2B e-Commerce d. Commerce using internet

10 EDI requires a. representation of common business documents in computer readable

forms b. data entry operators by receivers c. special value added networks d. special
hardware at co-operating Business premises

11 EDI standards are a. not universally available b. essential for B2B commerce c. not
required for B2B commerce d. still being evolved

12 EDIFACT is a standard a. for representing business forms used in e-Commerce b. for

e-mail transaction for e-Commerce c. for ftp in e-Commerce d. protocol used in e-
Commerce

13 EDIFACT standard was developed by a. American National Standard Institute V.

Rajaraman/IISc. Bangalore M13/V1/July 04/3 System Analysis and Design/Electronic
Commerce Multiple Choice Questions b. International Standard Institute c. European
Common Market d. United Nations Economic Commission for Europe

14 ANSI X.12 is a standard developed by a. American National Standard Institute b.

International Standard Institute c. European Common Market d. United Nations
Economic Commission for Europe

15 In B2B e-Commerce (i) Co-operating Business should give an EDI standard to be

used (ii) Programs must be developed to translate EDI forms to a form accepted by
application program (iii) Method of transmitting/receiving data should be mutually
agreed (iv) It is essential to use internet a. i, ii b. i, ii, iii c. i, ii, iii, iv d. ii, iii, iv
 16 EDI use a. requires an extranet b. requires value added network c. can be done on
internet d. requires a corporate intranet

17 EDI over internet uses a. MIME to attach EDI forms to e-mail messages b. FTP to
send business forms c. HTTP to send business forms d. SGML to send business forms

18 For secure EDI transmission on internet a. MIME is used b. S/MIME is used V.

Rajaraman/IISc. Bangalore M13/V1/July 04/4 System Analysis and Design/Electronic
Commerce Multiple Choice Questions c. PGP is used d. TCP/IP is used

19 EDI standard a. is not easily available b. defines several hundred transaction sets for
various business forms c. is not popular d. defines only a transmission protocol

20 By security in e-Commerce we mean (i) Protecting an organization’s data resource

from unauthorized access (ii)Preventing disasters from happening (iii) Authenticating
messages received by an organization (iv) Protecting messages sent on the internet from
being read and understood by unauthorized persons/organizations a. i, ii b. ii, iii c. iii, iv
d. i, iii, iv

Key to Objective Questions

1d 2c 3a 4c 5c 6a 7a 8c 9c 10 a 11 b 12 a
13 d 14a 15 b 16 c 17 a 18 b 19 b 20 d

Set 5

1. The term e-commerce includes ……………………….

A) Electronic trading of Physical goods and intangibles such as information.
B) The electronic provision of services such as after sales support or online legal advice
C) All the steps involved in trade, such as on-line marketing ordering payment and support for delivery.
D) All of the above.

2. Which of the following is the largest community in classification of e-commerce?

A) Business to Business (B to B)
B) Business to Consumer (B to C)
C) Business to Government (B to G)
D) Government to Government (G to G)
3. Which of the following is not the example of business to consumer (B to C) e-commerce?
A) Amazon.com
B) e-bay.com
C) dell.com
D) lastminute.com
4. The types of Business to Business e-commerce are …………….
A) Direct selling and support to Business
B) Industry portals
C) Information sites about a industry
D) All of the above

5. Which of the following are the benefits of E-marketing?

i) Speed ii) Reach and Penetration
iii) Ease and Efficiency iv) Low Cost
v) Targeted audience
A) i, ii, iii and iv only
B) ii, iii, iv and v only
C) i, iii, iv and v only
D) All i, ii, iii, iv and v

6. …………………. is the process of recreating a design by analyzing a final product.

A) Forward Engineering
B) Reverse Engineering
C) Backward Engineering
D) None of the above

7. ……………… is simply the use of electronic means to transfer funds directly from one account to another,
rather than by cheque or cash.
A) M-Banking
B) O-Banking
C) E-Banking
D) D-Banking

8. The telephone banking service includes ……………….

i) Automatic balance voice out ii) Inquiry all term deposit account
iii) Direct cash withdraw iv) Utility Bill payments
v) Voice out last five transactions
A) i, ii, iii and v only
B) i, ii, iv and v only
C) ii, iii, iv and v only
D) All i, ii, iii, iv and v

9. Which of the following are the forms of E-banking?

i) Internet Banking ii) Telephone Banking
iii) Electronic Check conversion iv) Electronic Bill Payment
v) Direct Deposit
A) i, ii, iii and iv only
B) ii, iii, iv and v only
C) i, iii, iv and v only
D) All i, ii, iii, iv and v

10. What is the full form of SWIFT?

A) Society for Worldwide Internet Financial Telecommunications.
B) Secret Wide Interbank Financial Telecommunications
C) Society for Worldwide Interbank Financial Telecommunications
D) None of the Above

ANSWERS:
1. D) All of the above.
2. A) Business to Business (B to B)
3. B) e-bay.com
4. D) All of the above
5. D) All i, ii, iii, iv and v
6. B) Reverse Engineering
7. C) E-Banking
8. B) i, ii, iv and v only
9. D) All i, ii, iii, iv and v
10.C) Society for Worldwide Interbank Financial Telecommunications