Meet Bluey, your cute blue study buddy. Bluey is here to help you review the biggest ideas from Chapter 6, including Moore’s Law, price/performance trends, multicore chips, cloud computing, latency, bandwidth, e-waste, and Disney’s MagicBand.
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Technology keeps getting cheaper and more powerful, which changes what businesses can build and what customers expect.
Hardware design matters strategically because speed, compatibility, switching costs, and cloud access can shape competition.
Managers also have to think about environmental impact, project coordination, infrastructure limits, and long-term disruption.
The widely used managerial interpretation of Moore’s Law says that for the same money, computer chips will be about twice as fast or store about twice as much data in roughly eighteen months, or chips with the same performance will cost about half as much.
Why it matters: Managers should expect rapid improvement in cost and performance when planning products, investments, and timing decisions.
A price/performance trend means that technology keeps improving so users can get more computing power, storage, or transmission speed for the same price over time.
Demand for computing is highly elastic because when computing becomes cheaper, people buy more of it and create new uses for it, which can lead to entirely new products and markets.
A semiconductor is a material that conducts electricity under some conditions and blocks it under others, making it the foundation of modern computer chips.
A transistor is a tiny electronic switch that can turn on or off to represent binary data and perform calculations inside a chip.
A bit is a binary digit, either 0 or 1, and it is the smallest unit used to represent data in a computer.
A byte is a unit of storage equal to 8 bits and is often used to measure files and storage capacity.
A multicore processor places two or more processing cores on the same chip so tasks can be handled more efficiently, often with less heat and lower power use than a single very fast core.
Parallel processing solves a problem by dividing it into smaller parts that multiple processors can work on at the same time.
Grid computing uses existing computers connected through software to work together like a much larger computing system.
Cluster computing links multiple servers together through software and networks so they function as one computing resource.
Cloud computing lets organizations rent computing power, storage, and related services over the internet instead of buying and maintaining all hardware themselves.
Latency is the delay between sending a request and getting a response back, so it measures how quickly data starts moving or returns from another system.
Bandwidth is the amount of data that can be moved over a connection in a given amount of time.
E-waste is discarded electronic technology that may contain harmful materials and can create environmental damage if it is not recycled or disposed of responsibly.
Which concept BEST explains why this startup idea may become practical over time?
Correct answer: B
Explanation: This scenario is about computing becoming cheaper and more capable over time, which is the key managerial meaning of Moore’s Law and related fast/cheap technology trends. That is exactly why an idea that once seemed too expensive can become realistic later. A is wrong because switching costs describe how hard it is to move from one system to another. C is wrong because the issue is not customer preference for a brand. D is wrong because the startup is not solving its problem by owning more of the production chain.
Which factor is MOST important for the club to prioritize?
Correct answer: A
Explanation: Online gaming depends heavily on low latency because players need actions to register almost instantly. The scenario says the biggest problem is the delay between action and response, which points directly to latency rather than total data volume. B is wrong because storage capacity does not solve live gameplay delay. C is wrong because byte size is a storage measure, not the key issue here. D is wrong because switching costs describe lock-in, not network responsiveness.
Which barrier to entry is MOST significant in this scenario?
Correct answer: C
Explanation: The scenario focuses on the massive upfront investment needed to build and operate a fab, which is a classic example of capital intensity. When entering a market requires enormous spending on facilities and infrastructure, new firms face a major entry barrier. A is wrong because network effects depend on user growth making a product more valuable. B is wrong because no lock-in based on stored data is described. D is wrong because elasticity is about demand changing with price, not entry cost.
Why might the new laptop fail to deliver the full performance gain the student expected?
Correct answer: B
Explanation: Multicore chips work best when software is written or adapted so separate parts of a task can run in parallel. The scenario directly states that her biggest gains depend on dividing work across multiple cores, so B is the best answer. A is wrong because bits and bytes are units of data, not the reason multicore performance is limited. C is wrong because multicore processors can often run older software, just not always with full advantage. D is wrong because switching costs have nothing to do with processor speed.
Which interpretation BEST explains why this wearable creates business value?
Correct answer: D
Explanation: The wearable creates value because it connects guest actions to a larger information system that collects data, coordinates services, and improves decisions. The scenario highlights system integration, analytics, staffing, and wait-time reduction, which all depend on powerful back-end support. A is wrong because the chapter emphasizes that projects like this require extensive back-end systems. B is wrong because novelty alone does not explain the operational gains. C is wrong because the device supports business processes rather than replacing them.
Primary Textbook: Gallaugher, John. Information Systems: A Manager's Guide to Harnessing Technology (with SmartGrader for Excel), v10.1.4.
Course Materials: University of Texas at Austin, MIS 301 course slide deck (Chapter 6: Moore’s Law & Hardware).