Question 1

The largest demand for smart cards continues to come from

Accepted Answer

The Asia-Pacific region has the largest demand for smart cards, primarily due to its large population, rapid urbanization, and increasing adoption of smart technologies in countries like China and India.

Question 2

Which of the following is an example of a charge card?

Accepted Answer

Diner's Club card is a type of charge card, which requires the full balance to be paid each month and does not have a credit limit. MasterCard, EuroPay, and Visa are examples of credit cards, which allow for a balance to be carried from month to month and have a credit limit.

Question 3

An electronic card containing an embedded microchip that enables predefined operations or the addition,deletion,or manipulation of information on the card best defines

Accepted Answer

The description given in the question best defines a smart card. A smart card contains an embedded microchip which can be programmed to carry out various functions or store and manipulate information. This makes them useful for secure authentication and transactions. The other options - pocket card, EPROM card, and secure card - are not as commonly used or defined in the same way as smart cards.

Question 4

________ are used for applications in which the data must be processed very quickly (e.g.,mass-transit applications,such as paying bus or train fares)or when contact is difficult (e.g.,security-entering mechanisms to buildings).

Accepted Answer

Contactless cards are used for applications in which the data must be processed very quickly or when contact is difficult. They work by using radio frequency technology to communicate with a reader, eliminating the need for physical contact. This makes them ideal for situations like mass-transit applications and security-entering mechanisms to buildings.

Question 5

Which of the following activates and reads the contents of the chip on a smart card,usually passing the information on to a host system?

Accepted Answer

A smart card reader activates and reads the contents of the chip on a smart card and passes the information on to a host system. Cloud reader, transmit reader, and cube reader are not commonly used terms in relation to smart card technology.

Question 6

A(n)________ has two separate chips embedded in the card (contact and contactless),which eliminates the need to carry multiple cards to support the various smart card readers and applications.

Accepted Answer

The answer of A(n)________ has two separate chips embedded in...

Question 7

Forms of payment cards include each of the following except

Accepted Answer

All of the options listed are forms of payment cards except for purchase cards, which are typically used by businesses for purchasing goods and services.

Question 8

________ offer Internet Merchant Accounts,which are special accounts for credit card authorization and payment processing.

Accepted Answer

Acquiring banks are financial institutions that offer merchant accounts for businesses to accept credit card payments. These accounts are authorized to process transactions and transfer funds from the customer's bank account to the merchant's account.

Question 9

Which of the following is an online fraud detection tool that matches a customer's transaction against a file containing customer information that is flagged if the customer is a known problem?

Accepted Answer

A negative list is a file containing customer information that is flagged if the customer is a known problem. It is commonly used in online fraud detection tools to match a customer's transaction against the negative list, and flag any potential fraudulent activity. Profile list and boycott list are not commonly used terms in fraud detection, while compliance list typically refers to a list of regulatory requirements that a company must adhere to.

Question 10

In 2010,the median number of fraud detection tools used by merchants was

Accepted Answer

The median number of fraud detection tools used by merchants in 2010 was 4.6.

Question 11

Which of the following participants in the online card payment process is the data center that processes card transactions and settles funds to merchants?

Accepted Answer

The processor is the data center that processes card transactions and settles funds to merchants.

Question 12

Approximately 80 percent of merchants use the Address Verification System,which results in a number of ________,meaning that the merchant may reject a valid order.

Accepted Answer

The Address Verification System (AVS) rejecting a valid order is an example of a false positive, where a legitimate action is incorrectly identified as fraudulent or suspicious.

Question 13

Smart cards that have erasable memory and are modifiable best describe

Accepted Answer

EEPROM (Electrically Erasable Programmable Read-Only Memory) cards have erasable memory and their contents can be modified, making them the best fit for the description given. Contact cards (A) require physical contact with the reader and do not necessarily have erasable memory. Contactless cards (B) do not require physical contact but may not have erasable memory. EPROM cards (C) have erasable memory but may not be modifiable.

Question 14

A special system that handles file management,security,input/output,and command execution and provides an application programming interface for a smart card best defines

Accepted Answer

A smart card operating system provides a special system that manages the functions of a smart card, including file management, security, input/output, and command execution. It provides an application programming interface that allows developers to write applications for the smart card. Networking operating systems and mobile operating systems are designed for networked devices and mobile devices respectively and do not necessarily have built-in support for smart card functionality. The BIOS is a basic input/output system that initializes hardware components during the boot process of a computer.

Question 15

Which of the following participants in the online card payment process is the financial institution that provides card services to banks?

Accepted Answer

Credit card associations, such as Visa and MasterCard, are organizations that provide card services to banks and govern the terms of card transactions, but they are not the financial institutions that directly issue cards to consumers or directly handle consumer bank accounts. The issuing bank is the correct answer as it is the financial institution that provides card services directly to consumers.

Question 16

If someone steals a smart card,the thief is usually out of luck,with the major exception of ________ used for retail purchases.

Accepted Answer

Contactless cards can be vulnerable to theft through electronic pickpocketing or skimming, where the thief uses a device to read the card's information from a distance. This can enable them to make unauthorized retail purchases. Contact cards, EPROM cards, and EEPROM cards are not susceptible to this type of theft as they require physical contact or have limited memory capacity.

Question 17

A(n)________ is a third-party service connecting a merchant's EC system to the appropriate acquiring bank or financial institution.

Accepted Answer

A payment service provider (PSP) acts as a link between the merchant's eCommerce system and the acquiring bank or financial institution to process the payment transactions. They provide secure payment processing, fraud detection, and payment gateway integration services to merchants. ISPs are responsible for providing access to the internet, ASPs provide software applications over the internet, and CSPs deal with extending credit to customers.

Question 18

Basic configurations for processing online payments include each of the following except

Accepted Answer

The other options listed (A, B and C) all involve some form of direct payment processing, either through a physical point-of-sale system or through software owned by the merchant. Option D, however, involves contracting with a separate company to check the validity of cash payments made online, which is not a basic configuration for processing online payments.

Question 19

According to a CyberSource survey,online revenue losses due to fraud in 2010 were

Accepted Answer

The CyberSource survey reported that online revenue losses due to fraud in 2010 were $2.7 billion.

Question 20

Key tools used in combating online fraud include

Accepted Answer

Combating online fraud requires a range of tools to ensure the security of online transactions. Negative lists are useful to help identify counterfeit websites, phishing scams, or fraudulent activities. Manual reviews help detect suspicious behavior and verify identity. Address verification is essential for ensuring the accuracy of customer information and prevent fraud. All of these tools are crucial for effective fraud prevention, making option D the correct answer.

Quiz 10: Electronic Commerce Payment Systems