CHAPTER 7. AMAZON: AN EMPIRE STRETCHING FROM

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CHAPTER 7. AMAZON: AN EMPIRE STRETCHING FROM

CARDBOARD BOX TO KINDLE TO CLOUD EXAM QUESTIONS

Actual Qs and Ans Expert-Verified Explanation

This Exam contains:

-Guarantee passing score -32 Questions and Answers -format set of multiple-choice -Expert-Verified Explanation Question 1: Firms that cannot generate cash quickly enough are referred to as having

_____.

• stock problems
• high-inventory turns
• stock-outs
• vertical integration problems
• liquidity problems

Answer:

liquidity problems Question 2: Allowing third-party sellers to list their products on Amazon is controversial. Why would Amazon allow products sold by others to appear on its site?

• Amazon's brand is reinforced as a first-choice shopping destination.
• Although products are sold by third parties, Amazon gains valuable data on things such as

customer browsing habits and sales.

• All of the available options are true.
• Selection attracts consumers.
• A network effect competitive advantage is created where more buyers attract more sellers,

which helps Amazon gain an advantage over any rival attempting to create a similar marketplace.

Answer:

• All of the available options are true.

Question 3: Which of the following is true of Amazon's warehousing process?

• When stacking shelves in its warehouses, Amazon ensures that no two similar products sit

next to each other.

• Amazon made its own robots, which are in charge of building an order from a warehouse's

inventory without any human intervention.

• Amazon's items that produce the most sales volume are stocked on shelves, alphabetically, to

speed selection and packing.

• Amazon's systems stamp names and addresses on boxes so they can be filled by pickers

directly from shelves.

• Amazon's items that are heavily discounted and about to be written off as 'unsellable

inventory' are dropped in an area called 'mass land' in one last-ditch effort to move under-performing warehouse stock.

Answer:

When stacking shelves in its warehouses, Amazon ensures that no two similar products sit next to each other.

Question 4: Which statement is true of Amazon?

• Its cloud computing business is one of the largest players in that category.
• Amazon made profits from the first year of its operation.
• Amazon concentrates more on its quarterly results and is inflexible on details about its vision.
• It took 5 years to get out of debt.
• Its profitability has remained constant over the years and analysts continue to predict profits

for the firm's future.

Answer:

cloud computing business is one of the largest players in that category

Question 5: How much human contact does Amazon's order process involve?

• Human workers can complete the entire order process in 3-5 hours.
• The order process involves about one minute of human contact.
• Human workers and robots collaborate to complete an order process in an average of fifteen

minutes.

• None; the process is entirely automated and fulfilled by robots.

Answer:

order process involves about one minute of human contact Question 6: Amazon has combined _____ and _____ to outperform sky-high expectations and become one of the most innovative firms in history.

Answer:

technology and strategy

Question 7: Which of the following is considered one of the three 'pillars' critical to Amazon's business success?

• Long-lasting technology
• Dynamic pricing
• Firm-owned brands
• Niche customers
• Large selection

Answer:

Large selection

Question 8: Which strategy was followed by Amazon's founder?

a) He focused more on Amazon's yearly results.

b) He postponed profit harvesting.

c) He built e-commerce operations only for Amazon's customers in the United States.

d) He reduced warehousing capacity.

e) He consciously ignored cloud computing platforms.

Answer:

b) He postponed profit harvesting.

Question 9: Amazon _____ is Amazon's first consumer-facing brick and mortar facility.

Answer:

Purdue Question 10: Which of the following Amazon products was discontinued in 2019 due to declines in usage and, most likely, the low profit margin it provided?

• Dash
• Alexa
• Echo
• Kindle

Answer:

Dash

Question 11: Identify each statement as true or false concerning reasons that a retailer would consider selling through Amazon using Amazon fulfillment services.

• New customers acquired through Amazon wouldn't have to create additional account

information if they already had an Amazon account

• Amazon will warehouse products
• Products can be searched for and discovered on the Amazon website
• Products will be available for free Prime shipping

Answer:

• New customers acquired through Amazon wouldn't have to create additional account information if

they already had an Amazon account

• Amazon will warehouse products
• Products can be searched for and discovered on the Amazon website
• Products will be available for free Prime shipping

Question 12: Reports suggest that Amazon cargo jets

• are inefficient; packages often have to be rerouted.
• often fly only partially full in an effort to make shipping faster.
• are always fully loaded and use more fuel than average.
• fly full but with lighter loads, cutting fuel costs.

Answer:

fly full, but with lighter loads, cutting fuel costs Question 13: Identify each statement as true or false concerning why Amazon allows third-party firms to offer products through its site.

• It reinforces the appeal of Amazon as a first-choice shopping destination
• It allows Amazon to maintain the customer relationship and acquire data, even if it sells

products from others

• Amazon earns revenue from the sale and fulfillment of third-party products
• It increases the firm's accounts receivable period

Answer:

True- It reinforces the appeal of Amazon as a first-choice shopping destination True - It allows Amazon to maintain the customer relationship and acquire data, even if it sells products from others True - Amazon earns revenue from the sale and fulfillment of third-party products False - It increases the firm's accounts receivable period Question 14: A firm can _____ and _____ to improve its cash conversion cycle in a way that benefits the firm.

Answer:

• lengthen its accounts payable period,
• increase its inventory turns