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CMA Foundation · Fundamentals of Business Economics and Management · Economic and Business Environment

A bank replaces most branch cashier work with mobile banking and chatbots. Which of the following is the most accurate description of a likely impact of this technological change on its environment and operations?

Per-transaction operating costs usually fall with mobile banking and chatbots, but the bank must reskill employees and manage cyber-security risk. Technology does not remove fraud risk, and it affects staff as well as customers, so the balanced statement is the one noting both cost savings and new challenges.

  1. AOperating costs per transaction typically fall, but the bank faces new needs for reskilling staff and for managing cyber-security riskCorrect
  2. BTechnology raises per-transaction costs because digital transactions require more staff than manual ones
  3. CTechnology removes all risks associated with fraud
  4. DTechnology change affects only the bank's customers, not its employees

Explanation

Digitalisation usually lowers the cost per transaction and widens reach, but it changes the skills needed and creates cyber-security and data risks. It does not eliminate fraud risk, does not raise per-transaction cost as a rule, and affects employees as well as customers.

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