END OF CHAPTER MATERIAL

CONCEPT CHECK

1. 1. Which of the following best describes the relationship between data and information?
   1. Data are interpreted information.
   2. Information is interpreted data.
   3. Data are more useful than information in decision making.
   4. Data and information are not related.
2. 2. A character is to a field as
   1. water is to a pool
   2. a pool is to a swimmer
   3. a pool is to water
   4. a glass is to water
3. 3. Magnetic tape is a form of
   1. direct access media
   2. random access media
   3. sequential access media
   4. alphabetical access media
4. 4. Which of the following is not an advantage of using real-time data processing?
   1. Quick response time to support timely record keeping and customer satisfaction
   2. Efficiency for use with large volumes of data
   3. Provides for random access of data
   4. Improved accuracy due to the immediate recording of transactions
5. 5. If a company stores data in separate files in its different departmental locations and is able to update all files simultaneously, it would not have problems with
   1. attributes
   2. data redundancy
   3. industrial espionage
   4. concurrency
6. 6. When the data contained in a database are stored in large, two-dimensional tables, the database is referred to as a
   1. flat file database
   2. hierarchical database
   3. network database
   4. relational database
7. 7. Database management systems are categorized by the data structures they support. In which type of database management system is the data arranged in a series of tables?
   1. Network
   2. Hierarchical
   3. Relational
   4. Sequential
8. 8. A company's database contains three types of records: vendors, parts, and purchasing. The vendor records include the vendor number, name, address, and terms. The parts records include part numbers, name, description, and warehouse location. Purchasing records include purchase numbers, vendor numbers (which reference the vendor record), part numbers (which reference the parts record), and quantity. What structure of database is being used?
   1. Network
   2. Hierarchical
   3. Relational
   4. Sequential
9. 9. Which of the following statements is not true with regard to a relational database?
   1. It is flexible and useful for unplanned, ad hoc queries.
   2. It stores data in tables.
   3. It stores data in a tree formation.
   4. It is maintained on direct access devices.
10. 10. A collection of several years' nonvolatile data used to support strategic decision-making is a(n)
    1. operational database
    2. data warehouse
    3. data mine
    4. what-if simulation
11. 11. Data mining would be useful in all of the following situations except
    1. identifying hidden patterns in customers' buying habits
    2. assessing customer reactions to new products
    3. determining customers' behavior patterns
    4. accessing customers' payment histories
12. 12. A set of small databases where data are collected, processed, and stored on multiple computers within a network is a
    1. centralized database
    2. distributed database
    3. flat file database
    4. high-impact process
13. 13. Each of the following is an online privacy practice recommended by the AICPA Trust Services Principles Privacy Framework except
    1. Redundant data should be eliminated from the database.
    2. Notification of privacy policies should be given to customers.
    3. Private information should not be given to third parties without the customer's consent.
    4. All of the above.

DISCUSSION QUESTIONS

1. 14. (SO 1) How does data differ from information?
2. 15. (SO 1) Why is it important for companies to store transaction data?
3. 16. (SO 2) Which type of data storage medium is most appropriate when a single record of data must be accessed frequently and quickly?
4. 17. (SO 3) Identify one type of business that would likely use real-time data processing rather than batch processing. Describe the advantages of real-time processing to this type of business.
5. 18. (SO 4) Differentiate between data redundancy and concurrency.
6. 19. (SO 4) What is the term for the software program(s) that monitors and organizes the database and controls access and use of data? Describe how this software controls shared access.
7. 20. (SO 4) Describe the trade-offs of using the hierarchical model of database storage.
8. 21. (SO 4) Describe the organization of a flat file database.
9. 22. (SO 4) What four conditions are required for all types of databases?
10. 23. (SO 4) Within a hierarchical database, what is the name for the built-in linkages in data tables? Which data relationships can be contained in a hierarchical database?
11. 24. (SO 4) Which database models are built on the inverted tree structure? What are the disadvantages of using the inverted tree structure for a database?
12. 25. (SO 4) Which database model is used most frequently in the modern business world? Why do you believe it is frequently used?
13. 26. (SO 5) How is the primary key used in a relational database?
14. 27. (SO 5) What language is used to access data from a relational database? Why is the language advantageous when accessing data?
15. 28. (SO 5) Which type of database model has the most flexibility for querying? How does this flexibility assist management?
16. 29. (SO 5) What are the first three rules of normalization? What is meant by the statement that the rules of normalization are additive?
17. 30. (SO 6) Differentiate between a data warehouse and an operational database.
18. 31. (SO 7) How is data mining different from data warehousing?
19. 32. (SO 7) How has Anheuser-Busch used data warehousing and data mining successfully?
20. 33. (SO 7) Identify and describe the analytical tools in OLAP.
21. 34. (SO 8) Differentiate between centralized data processing and distributed data processing.
22. 35. (SO 9) Why would a small company with 400 employees find it advantageous to use a cloud database (DaaS)?
23. 36. (SO 10) Why is control over unauthorized access so important in a database environment?
24. 37. (SO 10) What are some internal control measures that could prevent a hacker from altering data in your company's database?
25. 38. (SO 10) Why are data considered a valuable resource worthy of extensive protection?

BRIEF EXERCISES

1. 39. (SO 2) Arrange the following data storage concepts in order from smallest to largest, in terms of their size: file, record, database, character, and field.
2. 40. (SO 2) Think of a database that would be needed at a professional service firm to maintain the contact list of clients/patients at the office of a CPA, attorney, or medical doctor. Identify the fields likely to be used in this database. If you were constructing this database, how many spaces would you allow for each field?
3. 41. (SO 3) Suppose that a large company uses batch processing for recording its inventory purchases. Other than its slow response time, what would be the most significant problem with using a batch processing system for recording inventory purchases?
4. 42. (SO 4) Arrange the following database models in order from earliest development to most recent: network databases, hierarchical databases, flat file databases, and relational databases.
5. 43. (SO 4) Categorize each of the following as one-to-one, one-to-many, or many-to-many:
   • Subsidiary ledgers and general ledgers
   • Transactions and special journal
   • General ledgers and trial balances
6. 44. (SO 6) How might a company use both an operational database and a data warehouse in the preparation of its annual report?
7. 45. (SO 7) Using Anheuser-Busch's BudNet example presented in this chapter, think about the queries that might be valuable if a company like Gap, Inc., used data mining to monitor its customers' buying behavior.

PROBLEMS

1. 46. (SO 3) Differentiate between batch processing and real-time processing. What are the advantages and disadvantages of each form of data processing? Which form is more likely to be used by a doctor's office in preparing the monthly patient bills?
2. 47. (SO 4) Abylli Company does not use a database system; rather, it maintains separate data files in each of its departments. Accordingly, when a sale occurs, the transaction is initially recorded in the sales department. Next, documentation is forwarded from the sales department to the accounting department so that the transaction can be recorded there. Finally, the customer service group is notified so that its records can be updated. Describe the data redundancy and concurrency issues that are likely to arise under this scenario at Abylli.
3. 48. (SO 6) List and describe the steps involved in building a data warehouse.
4. 49. (SO 8) Describe the advantages and disadvantages of using a distributed database and distributed data processing. Do you think the advantages are worthwhile? Explain your answer.
5. 50. (SO 6) Read the online article at http://www.xconomy.com/boston/2010/09/20/netezza-sold-to-ibm-for-1-7b-will-help-big-blue-tackle-big-data/. Describe the services that Netezza offered and why IBM desired to purchase this company.
6. 51. (SO 11) Describe the ethical obligations of companies to their online customers.
7. 52. (SO 9) Read the article at http://www.eweek.com/cla/Enterprise-Networking/IBM-moves-customers-to-SmartCloud-for-Collaboration-147563/. Explain how the IBM customers mentioned in the article are using IBM's Smart Cloud.
8. 53. (SO 8) Oracle Corp. is the world's largest enterprise software company. Its business is based on information—helping people use it, share it, manage it, and protect it. Using a Internet search engine, search using the terms Google and “distributed database.” Describe how and why Google uses a distributed database. What problems is Google encountering related to its distributed database?
9. 54. (SO 10) List and describe the ten privacy practices recommended by the AICPA Trust Services Principles Privacy Framework. If you have ever made a purchase online, you have likely seen these practices in use. Provide any examples from your own personal experience.

CASES

1. 55. The screen capture that follows shows the relationships in a Microsoft Access database. For each relationship, explain the following:
   1. The type of parent-child relationship it represents
   2. Which attributes in the table are used to link the relationship
   3. The purpose of the relationship
2. 56. Shuttle-Eze operates airport shuttle vans in 12 large cities: Los Angeles, San Diego, San Francisco, Phoenix, Las Vegas, Houston, Dallas, Chicago, New York City, Washington DC, Miami, and Orlando. Shuttle-Eze operates passenger vans to shuttle travelers to and from the airports for a $25 fee per person.

   

   Required:

   1. Design the tables that the company would need in its database to operate these shuttles. Remember that they must collect, record, and track information about customers, payments, flights, gates, vans, drivers, and pick-up and delivery addresses. You may wish to add other types of data. The tables you design should have attributes (columns) for each critical piece of data. See Exhibit 13-4 for the concept of the table layouts. Your tables should meet the first three rules of data normalization.
   2. Describe the advantages and disadvantages for Shuttle-Eze of using a centralized database as opposed to a separate database for each location.
3. 57. Kroger Co., a large, nationwide grocery chain, maintains a customer reward system titled the “Kroger Plus Shopper's Card.” Customers who enroll in this system are entitled to discounts on products at Kroger stores and on Kroger gasoline. To earn discounts and other rewards, the shopper must use the “Kroger Plus” card at the time of checkout. The card has a bar code that identifies the customer. For Kroger, the system allows the opportunity to determine customer buying patterns and to use these data for data mining.

   Required:

   Using a Web search engine, search for “data mining” and “grocery.” Describe what types of information grocery stores collect that they can use for data mining purposes. Also, describe how grocery chains use data mining to improve performance.

   CONTINUING CASE: ROBATELLI'S PIZZERIA

   Refer to the Robatelli's Pizzeria case at the end of Chapter 1. In addition, read the article Elaine Black mentioned regarding Anheuser-Busch at http://www.cnn.com/2004/TECH/ptech/02/25/bus2.feat.beer.network/index.html. Use this article regarding the sales and inventory management systems in place at Anheuser-Busch, and

   1. Describe the purpose of a data warehouse and describe how Anheuser Busch uses data warehousing.
   2. Describe the purpose and use of data mining and describe how Anheuser-Busch uses data mining.
   3. Describe how data warehousing and data mining can facilitate reporting and analysis at Robatelli's.

   SOLUTIONS TO CONCEPT CHECK

   1. (SO 1) The following statement best describes the relationship between data and information: b. Information is interpreted data. Information is useful for decision making, whereas data typically require processing before they become practical for use in a decision-making process.
   2. (SO 2) A character is to a field as a. water is to a pool. In data storage terminology, characters are contained within a field.
   3. (SO 2) Magnetic tape is a form of c. sequential access media. Magnetic tape must be accessed in the order it was recorded.
   4. (SO 3) The following is not an advantage of using real-time data processing: b. efficiency for use with large volumes of data. This is a characteristic of batch processing rather than real-time processing.
   5. (SO 4) If a company stores data in separate files in its different departmental locations and is able to update all files simultaneously, it would not have problems with d. concurrency. Concurrency problems arise when a company has difficulty updating data at its various locations at the same time.
   6. (SO 4) When the data contained in a database are stored in large, two-dimensional tables, the database is referred to as a a. flat file database. The two dimensions for a flat file database are rows and columns.
   7. (CIA Adapted) (SO 4) Database management systems are categorized by the data structures they support. In a c. relational database management system, the data are arranged in a series of tables.
   8. (CIA Adapted) (SO 4) A company's database contains three types of records: vendors, parts, and purchasing. The vendor records include the vendor number, name, address, and terms. The parts records include part numbers, name, description, and warehouse location. Purchasing records include purchase numbers, vendor numbers (which reference the vendor record), part numbers (which reference the parts record), and quantity. The structure of the database being used is c. relational, since the links are contained within the data records themselves. Answers a. and b. are incorrect because these structures would have directional pointers or trees, respectively, rather than explicit data values. Answer d. is incorrect because it is an access method rather than a database structure.
   9. (CIA Adapted) (SO 4,5) The following statement is not true with regard to a relational database: c. It stores data in a tree formation. This response is characteristic of a hierarchical database.
   10. (SO 6) A collection of several years' nonvolatile data used to support strategic decision making is a b. data warehouse. The data in a data warehouse do not change except for the occasional upload of new data.
   11. (SO 7) Data mining would be useful in all of the following situations except c. assessing customers' payment histories. Assessing customers' payment history would likely require a data warehouse, whereas data mining is focused on behavioral patterns.
   12. (SO 8) A set of small databases where data are collected, processed, and stored on multiple computers within a network is a b. distributed database.
   13. (SO 10) Each of the given statements is an online privacy practice recommended by the AICPA Trust Services Principles Privacy Framework except the following: a. Redundant data should be eliminated from the database. Redundancy is addressed in the rules of data normalization, but not in the AICPA's Privacy Framework.