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IIBM – Management Information Systems Answer sheet

IIBM – Management Information Systems Answer sheet


Section A: Objective Type & Short Questions (30 marks)

I.A person machine system and a highly integrated grouping of information-processing functions designed to provide management with a comprehensive picture of a specific operation is called (1)

  1. d) All the above
  2. Which one of the following is not an important characteristic of useful and effective information? (1)
    a) Accuracy
    b) Timelines
    c) Completeness
    d) Economy

III. The most important reason for failure of MIS is (1)
a) Use of improper tools for design
b) Noninvolvement of end-user
c) Improper specification
d) None of the above

  1. Top-level Managers use (1)
    a) Strategic information
    b) Tactical information
    c) Operational information
    d) None of these

V.System is an important factor of MIS. There are various types of systems. Which one of the following is not a system? (1)
a) Physical system
b) Integrated system
c) Open system
d) Open system

  1. Which one of the following is not an approach for the development of MIS? (1)
  2. a) Hierarchical approach
  3. b) Integrative approach
  4. c) Modular approach
  5. d) Elective approach

VII. Management is linked to information by (1)
a. Decisions
b. Data
c. Both [A] And [B]
d. None Of The Above


VIII. Which pattern reflects a pure executive form of management?
a. Functional
b. Line
c. Line and Staff
d. Committee

  1. The term financial engineering is related to (1)
    a) Cost of production
    b) Financial Restructuring
    c) Product planning
    d) Capital issue
  2. The goal of financial management is to (1)
    a) Maximize the wealth of preference shareholders
    b) Maximize the wealth of debenture holders
    c) Maximize the wealth of equity shareholders
    d) All of the above

Part Two:

  1. What is the purpose of information systems from a business perspective? (5)
  2. What are Enterprise Systems? How do they benefit businesses? (5)
  3. Differentiate DSS from MIS. (5)
  4. What do you mean by Data visualizations? (5)

Section B: Caselets (40 marks)

Caselet -1

A waiter takes an order at a table and then enters it online via one of the six terminals located in the restaurant dining room. The order is routed to a printer in the appropriate preparation area: the cold-item printer if it is a salad, the hot-item printer if it is a hot sandwich, or the bar printer if it is a drink. A customer’s meal check-listing (bill) the items ordered and the respective prices are automatically generated. This ordering system eliminates the old three-carbon-copy guest check system as well as any problems caused by a waiter’s handwriting. When the kitchen runs out of a food item, the cooks send out an ‘out of stock’ message, which will be displayed on the dining room terminals when waiters try to order that item. This gives the waiters faster feedback, enabling them to give better service to the customers. Other system features aid management in the planning and control of their restaurant business. The system provides up-to-the-minute information on the food items ordered and breaks out percentages showing sales of each item versus total sales. This helps management plan menus according to customers’ tastes. The system also compares the weekly sales totals versus food costs, allowing planning for tighter cost controls. In addition, whenever an order is voided, the reasons for the void are keyed in. This may help later in management decisions, especially if the voids are consistently related to food or service. Acceptance of the system by the users is exceptionally high since the waiters and waitresses were involved in the selection and design process. All potential users were asked to give their impressions and ideas about the various systems available before one was chosen.


  1. What would make the system a more complete MIS rather than just doing transaction processing? (10)

  2. Explain the probable effects that making the system more formal would have on the customers and the management. (10)

Caselet 2

The Company is considered to be a leader in the design and production of industrial and commercial air-conditioning equipment. While most of the products were standard items, a considerable number involving large sales volumes were specially designed for installation in big office buildings and factories. Besides being an innovator in product design and having an exceptionally good customer service department, the company is well known for its high-quality products and its ability to satisfy customer requirements promptly.

Because of its rapid growth, the company had to be careful with its cash requirements, especially for accounts receivable and for inventories. For many years, the company had kept inventories under close control at a level equal to 1.7 times the monthly sales, or a turnover of nearly 6 times per year. But, all of a sudden, inventories soared to triple monthly sales, and the company found itself with Rs.30 crores of inventories above a normal level. Calculating the cost of carrying inventory at 30 percent of the value of inventories (including the cost of money, storage and handling, and obsolescence), it was estimated that this excess inventory was costing the company Rs.9 crores per year in profits before taxes. In addition, it forced the to call on its bank for more loans than had company been expected.

Mr. Dcepak Mehra, president of Connair, was understandably worried and incensed when this matter came to his attention. He was told that the primary reasons for this rise in inventory were excessive buying of raw materials in advance because of anticipated shortages and the failure of new computer software, with the result the people in the production and purchasing departments did not have complete information as to what was happening to inventory for several months.

Mr. Mehra, taking the stand that no company should let something like this surplus inventory occur without advance notice and that no manager can be expected to control a business based on history, instructed his vice-president for finance to come up with a program to get better control of inventories in the future.

Questions for Discussion:

  1. What do you find wrong with Connair\’s controls? (10)

2. Difficulty blending multiple personalities into a cohesive and unified team.

3. Failure to develop key competencies and behaviors.

4. Poor communication and feedback.

5. Lack of awareness.

  1. Are there any other techniques or approaches to control that you would suggest? (10)

Section C: Applied Theory (30 marks)

  1. List and describe the information systems serving each of the major functional areas of business. (15)

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