How Can a Cost Leader Use E-Business to Reduce Costs

question 46

Multiple Choice

How can a cost leader use e-business to reduce costs?

• A) It could automate purchasing and payment systems so that customers have detailed status reports.
• B) It could provide rapid online responses to service requests.
• C) It could use Internet-based knowledge systems to shorten customer response times.
• D) It could use Web-based inventory control systems that reduce storage costs.

---

Definitions:

Preferred Stock Conversion

The process by which holders of preferred shares can convert their stocks into a predetermined number of common shares, often under specific conditions.

Dividends in Arrears

Dividends on cumulative preferred stock that have not been declared or paid for the current or previous periods, accumulating until they are paid out.

Cumulative Preferred Stock

A type of preferred stock that entitles its holders to receive dividends that have been missed in previous payments before any dividends can be issued to other types of shareholders.

Participating Preferred Stock

A type of preferred stock that offers dividends that exceed the fixed amount if the company's profits reach predetermined targets.