DVD Heaven Sells New and Used DVDs, Particularly to University

question 66

Short Answer

DVD Heaven sells new and used DVDs, particularly to university and college students in large Canadian cities. It plans to expand its business online, hoping to increase sales by offering a more convenient means of ordering for busy college students.
The president of DVD Heaven has been talking to several other business owners, and now expresses some concerns over developing the e-commerce side of the business. The vice president argues that it is essential for continued growth, but the president argues that there are too many consumer concerns. Which of the following statements, if true, would NOT support the argument being made by the president regarding consumer concerns?
Fraudulent businesses are being set up and run on the internet. Many consumers would rather enter a building that houses a business they know really exists.
Identity theft and the theft of credit card numbers can occur when ordering online.
Privacy can be compromised on the internet, and unethical e-businesses can track or sell sensitive information such as buying patterns.
College students are five times more likely to order over the internet than older adults.
Customers like to see and feel products before ordering them.

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Definitions:

Financing Section

This term refers to the part of a financial report or business plan that outlines how a company funds its operations, including debt, equity, and other financing sources.

Treasury Stock

Shares that were once a part of the outstanding shares and have been bought back by the company.

Statement of Cash Flows

A report detailing how variations in balance sheet accounts and income levels influence cash and cash equivalents.

Operating Activities

Activities that are directly related to the running of a business and its day-to-day functions, generating most of its revenue and expenses.