Database Processing for BIS Questions and Answers

Q: Business Intelligence (BI) systems do not obtain data from operational databases.

Correct answer: FalseReading operational data is one of the three standard sources for a BI system, alongside extracts from operational databases and data purchased from vendors. What BI systems do not do is process transactions; reading what transactions have already recorded is precisely how they get their raw material.

Q: Data Mining uses simple arithmetic techniques such as sums, averages, and groupings to perform what-if analyses, to make predictions, and to facilitate decision making.

Correct answer: FalseThe description given - sums, averages and groupings - is reporting, not data mining. Data mining applies statistical and mathematical techniques such as regression, clustering, decision trees and neural networks. The line between the two branches of business intelligence is drawn exactly at the sophistication of the technique used.

Q: A data warehouse is a database system that is optimized for operational transaction processing.

Correct answer: FalseA data warehouse is optimised for the opposite of transaction processing. Operational databases are tuned for many small fast writes and are normalised to protect integrity; a warehouse is tuned for large analytical reads, is usually denormalised into star schemas, and is loaded in batches rather than updated continuously.

Q: Business Intelligence (BI) systems fall into two broad categories: reporting and data warehousing.

Correct answer: FalseThe two categories are reporting and data mining. Data warehousing is not a category of BI system at all but the infrastructure that supplies both of them with clean, integrated, appropriately structured data - which is why it is discussed alongside them rather than as one of them.

Q: Most operational databases can be used for many BI applications.

Correct answer: FalseOperational data is generally poorly suited to BI without substantial preparation: it is dirty, has missing values, is spread across non-integrated sources, is too voluminous, and is granular in ways that do not match the analysis. That gap is exactly why data warehouses, with their extraction, cleaning and preparation programs, exist.

Q: Most operational databases can be used for many BI applications.

Correct answer: FalseOperational data is generally poorly suited to BI without substantial preparation: it is dirty, has missing values, is spread across non-integrated sources, is too voluminous, and is granular in ways that do not match the analysis. That gap is exactly why data warehouses, with their extraction, cleaning and preparation programs, exist.

Q: The data warehouse DBMS needs to be the same DBMS used for the operational database.

Correct answer: FalseThere is no such requirement, and in practice the two are often different products chosen for different purposes: the operational DBMS for transaction throughput and integrity, the warehouse DBMS for analytical query performance over large volumes. The extraction and preparation programs bridge whatever difference exists.

Q: RFM analysis is a BI reporting system.

Correct answer: TrueRFM scores customers on recency, frequency and monetary value using nothing more than sorting, grouping and simple arithmetic, which places it in reporting rather than data mining. That is the whole basis of the classification: reporting uses simple operations on existing data, data mining uses statistical and mathematical techniques to predict.

Q: In a common form of RFM analysis, customers are sorted in five groups and given a score of 1 to 5 depending on their group.

Correct answer: TrueThe customer base is divided into fifths on each of the three measures, and a customer receives a score of 1 to 5 on each according to which fifth they fall into, 1 being the best. The three scores together form a code such as 1 1 5 or 5 5 5, and it is that code by which customers are grouped and acted on.

21.

We have done an RFM analysis on our customer data. Mary Jones has a score of "1 1 5". This series means that Mary ________ .

A.Has ordered recently, orders frequently, and places a large order when she orders.
B.Hasn't ordered recently, orders infrequently, but places a large order when she orders.
C.Has ordered recently, orders frequently, but doesn't place a large order when she orders
D.Hasn't ordered recently, orders infrequently, and doesn't place a large order when she orders.

Answer: C

Correct answer: Has ordered recently, orders frequently, but doesn't place a large order when she orders

Each digit is a fifth of the customer base, with 1 the best and 5 the worst on that measure. So 1 for recency means she ordered very recently, 1 for frequency means she orders very often, and 5 for monetary value means her orders are among the smallest. A frequent, current, low-value customer - worth keeping but not worth a large sales effort.

Discuss in Forum

22.

Business Intelligence (BI) systems do not obtain data from operational databases.

A.True
B.False

Answer: B

Correct answer: False

Reading operational data is one of the three standard sources for a BI system, alongside extracts from operational databases and data purchased from vendors. What BI systems do not do is process transactions; reading what transactions have already recorded is precisely how they get their raw material.

Discuss in Forum

23.

Data Mining uses simple arithmetic techniques such as sums, averages, and groupings to perform what-if analyses, to make predictions, and to facilitate decision making.

A.True
B.False

Answer: B

Correct answer: False

The description given - sums, averages and groupings - is reporting, not data mining. Data mining applies statistical and mathematical techniques such as regression, clustering, decision trees and neural networks. The line between the two branches of business intelligence is drawn exactly at the sophistication of the technique used.

Discuss in Forum

24.

A data warehouse is a database system that is optimized for operational transaction processing.

A.True
B.False

Answer: B

Correct answer: False

A data warehouse is optimised for the opposite of transaction processing. Operational databases are tuned for many small fast writes and are normalised to protect integrity; a warehouse is tuned for large analytical reads, is usually denormalised into star schemas, and is loaded in batches rather than updated continuously.

Discuss in Forum

25.

Business Intelligence (BI) systems fall into two broad categories: reporting and data warehousing.

A.True
B.False

Answer: B

Correct answer: False

The two categories are reporting and data mining. Data warehousing is not a category of BI system at all but the infrastructure that supplies both of them with clean, integrated, appropriately structured data - which is why it is discussed alongside them rather than as one of them.

Discuss in Forum

26.

Most operational databases can be used for many BI applications.

A.True
B.False

Answer: B

Correct answer: False

Operational data is generally poorly suited to BI without substantial preparation: it is dirty, has missing values, is spread across non-integrated sources, is too voluminous, and is granular in ways that do not match the analysis. That gap is exactly why data warehouses, with their extraction, cleaning and preparation programs, exist.

Discuss in Forum

27.

Most operational databases can be used for many BI applications.

A.True
B.False

Answer: B

Correct answer: False

Discuss in Forum

28.

The data warehouse DBMS needs to be the same DBMS used for the operational database.

A.True
B.False

Answer: B

Correct answer: False

There is no such requirement, and in practice the two are often different products chosen for different purposes: the operational DBMS for transaction throughput and integrity, the warehouse DBMS for analytical query performance over large volumes. The extraction and preparation programs bridge whatever difference exists.

Discuss in Forum

29.

RFM analysis is a BI reporting system.

A.True
B.False

Answer: A

Correct answer: True

RFM scores customers on recency, frequency and monetary value using nothing more than sorting, grouping and simple arithmetic, which places it in reporting rather than data mining. That is the whole basis of the classification: reporting uses simple operations on existing data, data mining uses statistical and mathematical techniques to predict.

Discuss in Forum

30.

In a common form of RFM analysis, customers are sorted in five groups and given a score of 1 to 5 depending on their group.

A.True
B.False

Answer: A

Correct answer: True

The customer base is divided into fifths on each of the three measures, and a customer receives a score of 1 to 5 on each according to which fifth they fall into, 1 being the best. The three scores together form a code such as 1 1 5 or 5 5 5, and it is that code by which customers are grouped and acted on.

Discuss in Forum

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