Computer applications for business management Ch-1

CHAPTER – 1

INTRODUCTION

Definition of a Computer

Definition 1:
Computer is an Electronic data processing device which is capable of performing Arithmetic and
Logical operations. More than that a computer can choose, copy, move, position and perform other non-
arithmetic operations on the many alphabetic, numeric and other symbols that humans use to represent
things.

Arithmetic operations are:

Addition, Subtraction, Multiplication, Division, etc.

Logical operations are:

And, or, Not, Compare, etc.

Definition 2:
An electronic symbol manipulating system that’s designed and organized to automatically accept
and store input data, process them and produce the output, that results under the direction of a detailed
step-by-step stored program.

Definition 3: Artificial Intelligence the fast growing computer research division defines the same computer
as
“Computer is similar to human being but, without thinking power ".
That means computer can think equivalent to human being in certain aspects, the major difference
between computer and human being is thinking power, by giving this power as set of instructions to
computer, called ARTIFICIAL INTELLIGENCE, human can find solution to any of his problems.

Computers Vs. Human beings

Humans have rather poor memory; he needs certain support apart from his abilities and capacities.
Because of poor memory and mental tiredness humans lack in accuracy, speed, and reliability, that is why,
human needs computer as their additional support.

Differences between Human Attitude and computer Attitudes

Human Computer
Can Think Cannot think by itself
Gets Mental Tiredness Never gets Tiredness
May do mistake Can’t do mistake by itself
Has limited speed Very High Speed
Has limited Memory More Amount of memory
Accuracy may be missing Never missing
“Ability of a Human to do anything a computer can do but a computer cannot do everything a human
can do” is a true statement based on the following table.

Computer Science Department Admas University

 Computer applications for business management Ch-1

Operations Performed Corresponding Actions Performed by

by a Computer a Human
Hold instruction in internal storage Remember a set of instructions
Read data in machine readable form Read data in written or printed form
and memorize it or file it.
Perform arithmetic Computations Can perform arithmetic operations
Make comparisons Can make comparisons
Retrieve any data from internal memory Remember data or retrieve data from
or secondary storage file
Output the results on an output device Speak or Write the result on paper

Characteristics of computer

• High Speed: Computer is a very fast device. It is capable of performing calculation of very large
amount of data. The computer has units of speed in microsecond, nanosecond, and even the
picosecond. It can perform millions of calculations in a few seconds as compared to man who
will spend many months for doing the same task.
• Accuracy: In addition to being very fast, computers are very accurate. The calculations are 100%
error free. Computers perform all jobs with 100% accuracy provided that correct input has been
given.
• Storage Capability: Memory is a very important characteristic of computers. A computer has
much more storage capacity than human beings. It can store large amount of data. It can store
any type of data such as images, videos, text, audio and many others.
• Diligence: Unlike human beings, a computer is free from monotony, tiredness and lack of
concentration. It can work continuously without any error and boredom. It can do repeated work
with same speed and accuracy.
• Versatility: A computer is a very versatile machine. A computer is very flexible in performing the
jobs to be done. This machine can be used to solve the problems related to various fields. At
one instance, it may be solving a complex scientific problem and the very next moment it may
be playing a card game.
• Reliability: A computer is a reliable machine. Modern electronic components have long lives.
Computers are designed to make maintenance easy. Automation Computer is an automatic
machine.
• Automation: means ability to perform the given task automatically. Once a program is
given to computer i.e., stored in computer memory, the program and instruction can
control the program execution without human interaction.
• Reduction in Paper Work: The use of computers for data processing in an organization leads to
reduction in paper work and results in speeding up a process. As data in electronic files can be
retrieved as and when required, the problem of maintenance of large number of paper files gets
reduced.
• Reduction in Cost: Though the initial investment for installing a computer is high but it
substantially reduces the cost of each of its transaction.

Computer Science Department Admas University

 Computer applications for business management Ch-1

Limitations of computer
• No I.Q: A computer is a machine that has no intelligence to perform any task. Each instruction
has to be given to computer. A computer cannot take any decision on its own.
• Dependency: It functions as per a user’s instruction, so it is fully dependent on human being
Environment The operating environment of computer should be dust free and suitable.
• No Feeling: Computers have no feelings or emotions. It cannot make judgment based on feeling,
taste, experience, and knowledge unlike a human being.

Types of computers
There are different types of Computers. Their difference is depending on different grouping categories.
Classification by the method of operation (processing)

Based On Data Processing They are classified into three:

1. Analog
Analog computers operate by measuring. They deal with continues variables; they don’t compete directly
with numbers, rather, they operate by measuring physical magnitude such as pressure, temperature,
voltage, current etc.
Example:
✓ Thermometer, Voltmeter, Speedometer, and Gasoline pomp – Contains an analog Computer that
converts the flow of pumped fuel into two measurements the price of the delivered gas and the
quantity of pumped fuel. They are special purpose computers. Analog computers have limited
accuracy

2. Digital Computers
Digital computers deal with discrete variables; they operate by counting rather than measuring. They
operate directly up on numbers (or digits) that represent numbers, letters, or other special symbols.
Examples:
✓ Abacus
✓ Desk & pocket computers
✓ The general purpose computers

Digital computers have higher accuracy and speed than the analog ones.
3. Hybrid Computers
The best features of analog and digital computers can be combined into a single device to form a hybrid
computer. A hybrid computer process the information by collecting input data with analog method,
convert it into digital quantities, processes the digital values and convert the output from digital to
analog form.
Example:
✓ In hospital insensitive-care unit analog devices may measure a patient’s heart function,

Computer Science Department Admas University

 Computer applications for business management Ch-1

temperature and other vital signs. These measurements may then be converted into numbers and
supplied to a digital component in the system. This component is used to monitor the patient’s
vital signs and to send an immediate signal to the nurse’s station, if any abnormal readings are
detected.

Classification by purpose or application

Computers can be applied or used for different purposes. Based upon their application, they are
classified as special purpose and general-purpose computers.
1. Specific purpose computers
They are designed to solve a single type of problem, that is their components and function are uniquely
adapted to a specific situation involving specific application.
Example:
✓ The public telephone box
✓ Traffic control system
✓ Ticket machines (used in grocery, super market etc.)
✓ Pocket calculators etc.
Most analog computers are special purpose computers.

2. General-purpose computers
They are designed to solve variety of problems through the use of “store program concept”. A program
or set of instructions designed to solve a problem is read and stored into the memory and then executed
by the computer one by one. The same computer can be applied to solve another set of problem using
different program. General purpose computers are more flexible and versatile.
Examples
✓ Microcomputers, Mini computers, Super computers etc.

3. Classification by physical size, price, capacity and performance

At this stage, by a computer, we mean a general-purpose digital computer. There is a wide variety of
general-purpose digital computers on the market place today, in terms of physical size, price, capacity,
and performance. They are then classified as follows by their capacity and size:

Super computers: - are the fastest, largest and most potential types of computer. They have speed of
hundreds of millions of operation per second, a primary memory capacity of about 80 million characters,
a secondary memory of capacity of about 20 times its primary memory. They are multi-user systems in
intercontinental range. They can carry out enormously complex scientific calculations. They are used to
process huge amount of data and are commonly used in space technology centers, meteorology stations,
and astronomical observatories, inter-continental communications, airline organizations.
Mainframe computers: - Smaller than in size and capacity, lower in speed & memory capacity than the
Computer Science Department Admas University
 Computer applications for business management Ch-1

super computers. However they are multi-user systems and handle hundreds of users, usually used in
large organizations.
Mini computers: - have relatively lower speed, can handle multi-users, are smaller in size than the
mainframe computers. They use terminals for inputs and output. Mini computers are used in small
organizations.
Micro-computers:-Micro-computer (personal or desktop computer) is a computer whose CPU is
microprocessor. Microprocessor is a processor all of whose components are on a single integrated-circuit
chip. Since its CPU is integrated in a single circuit, it can serve only a single user at a time. Most of home
and personal office computers are microcomputers. The relative performance and usage of personal
computer is relatively increased with a very high rate.
Application of computers
Learning Aids:
Examples:
✓ Learning toys, programs range from simple arithmetic to calculus, from English grammar to
creative writing and foreign language, and from basic graphics to engineering design models.
Entertainment:
Examples:
✓ Games
Commercial or business applications
Computers are needed to perform business operations that require handling large amounts of data. Several
computer applications are available to assist business in working with large volumes of data.
Examples:
✓ Text processing, Accounting and Finance management, Inventory control, Database
management and Statistical analysis
Scientific – engineering and research applications
Computers are used for scientific research, complex mathematical calculations, design work, and analysis
and control of physical systems.
Examples:
✓ Space technology, Meteorological observatory systems, Astronomical investigations, Design of
machines and Control of manufacturing process

Computer Science Department Admas University

 Computer applications for business management Ch-1

Information Utilities
Information utilities companies use large computers that store huge amount of information about many
different subjects. These computer systems and their vast amount of data are available for personal use.
For example: information utilities can allow a computer user to read the daily news , research published
works, send a letter to a friend, play games, make airline reservations, obtain the latest stock market
quotations, and perform many other activities.
Example:
✓ Internet.
Ethiopian airline is a member of World-Wide reservation system called Gabriel system.
✓ The main database is located at Atlanta, Georgia
✓ More than 48 airlines including EAL share /extract/transmit information using Gabriel
Facilities included:
✓ Booking of passengers on Domestic and International flight on EAL or Other carrier (EX.
Lufthansa).
✓ Making hotel reservation for the travelers (i.e. the system is connected with major hotels &
travel agents)
✓ Massage correspondence with all stations which are members of Gabriel (i.e. reconfirmation
space availability, etc)
Elements involved in the reservation system are:
✓ Computer Network, Computer terminal, Communication Channels ( telephone lines, satellite,
etc), Modems and Electronic Banking and Service:
Example: Teller Machine (customers are issued cards that permit them to use other banks teller machine’s),
Online banking (A bank customer can use his/ her computer to check account balances, transfer funds,
pay bills)
Shopping from Home (E-commerce)
Individual may now shop by computer in the comfort of their home.
Household Control
A growing number of the newer houses hold devices are computers controlled. For example: Security
systems, refrigerators, microwave ovens, washers, stereos, and televisions. This computer controlled home
security system monitors movements, broken glass, unlawful entry without a security code, and so on, and
alerts the local police department.
Weather and Environment
Computer equipment may show temperature ranges, precipitation levels and wind flow and can used in
weather forecasting. Computer can also help in overcoming environmental hazards.
Computer Science Department Admas University
 Computer applications for business management Ch-1

Transportation
Computers have affected almost every kind of transportation. Many aircraft can fly under the control of
the computer; in this situation, the captain simply serves as a manger by telling the computer what to
do. In Cars, computers have provided functional controls such as spark and fuel control.
Medical and Health Care
Computers have long been used by hospitals for routine record keeping. Today, however, many people
owe their lives to the computer. Computers are used in hospitals as sensors (device that detect changes
in blood pressure, heart rate, temperature), testing (scan the body and provide 3-D figure), patient
treatment.
Routine and Dangerous Tasks
Computers are used in routine tasks. And they can perform task in environments to dangerous for
human workers.
Consultant (Expert system)
An Expert system is a computer program, which can solve problems from a specific knowledge base.
These systems don't replace expert humans because the knowledge base of expert system is given from
the skilled specialist.
Example:
✓ Mycin (a medical diagnostic program by using sophisticated decision making process).

Data representation inside a computer

Units of Data Representation

When data is stored, processed, or communicated within the computer system, it is “packed” in units.
Arranged from the smallest to the largest, the units are called bits, bytes, & words.
Bits: is abbreviated for binary digit, the smallest unit of information that can be stored and manipulated
by a computer. A bit is represented by the numbers 1, & 0, which correspond to the states on & off, true
& false, or yes & no.
Bytes: is the collection of 8 bit.
- Is the basic unit of information in a computer’s memory.
- 1 bit has 2 states, there are 8 bits in a byte. The possible combination is 256(28). These
combination can provides enough possible patterns to represent the entire alphabet(A-Z/a-z),
numeric digits(0,1,2,…,9), special characters(!, ?, *, …)
- Bytes are calculated by raising the number 2 to various power.
For Example
210 is 1024 1000(or 1KB)
- 1KB(Kilo bytes)-1024 bytes-can store 1,000 characters.
- 1MB = 220 bytes 106 bytes- can store 1 Million characters
- 1GB = 230 bytes  109 bytes – can store 1 Billion characters.
- 1TB= 240 bytes  1012bytes- can store 1 Trillion characters.

Computer Science Department Admas University

 Computer applications for business management Ch-1

 A computer having 256MB of memory is capable of storing

256 * 1048576(220Mega) bytes.
 A floppy disk holds 1.44 MB of data  1, 400, 000 characters.
 A single floppy disk can hold a document  700 pages long, with 2000 characters per page.
Words
- Bytes are combined into groups of 1 to 8 bytes called words.
- Words refer to the number of bits that a computer process at once.
- Typically word lengths are 8 bits, 16 bits, 32 bits & 64 bits.

1.2 Number system, operations and codes

 A number system is a set of symbols used to represent values derived from a common base or
radix.
 As far as computers are concerned, number systems can be classified into two major categories:

 decimal number system

 binary number system
 octal number system
 hexadecimal number system

1.2.1 Decimal number system

 The term decimal is derived from a Latin prefix deci, which means ten. Decimal number
system has ten digits ranging from 0-9. Because this system has ten digits, it is also called a
base ten number system or denary number system.
 A decimal number should always be written with a subscript 10 e.g. X10
 But since this is the most widely used number system in the world, the subscript is usually
understood and ignored in written work. However, when many number systems are
considered together, the subscript must always be put so as to differentiate the number
systems.
 The magnitude of a number can be considered using these parameters.

 The absolute value is the magnitude of a digit in a number. For example, the digit 5 in
7458 has an absolute value of 5 according to its value in the number line. As
7*103+4*102+5*101+6*100
 The place value of a digit in a number refers to the position of the digit in that number
i.e. whether; tens, hundreds, thousands etc.
 The total value of a number is the sum of the place value of each digit making the
number.
 The base value of a number also k known as the radix, depends on the type of the
number systems that is being used. The value of any number depends on the radix. for
example, the number 10010 is not equivalent to 1002.

1.2.2 Binary numbering system

Computer Science Department Admas University
 Computer applications for business management Ch-1

It uses two digits namely, 1 and 0 to represent numbers. Unlike in decimal numbers where the
place value goes up in factors of ten, in binary system, the place values increase by the factor of 2.
Binary numbers are written as X2. Consider a binary number such as 10112.The right most digit
has a place value of 1×20 while the left most has a place value of 1×23.

1.2.3 Octal number system

Consists of eight digits ranging from 0-7.the place value of octal numbers goes up in factors of
eight from right to left.

1.2.4 Hexadecimal number system

This is a base 16 number system that consists of sixteen digits ranging from 0-9 and letters A-F
where A is equivalent to 10, B to 11 up to F which is equivalent to 15 in base ten system. The
place value of hexadecimal numbers goes up in factors of sixteen.

1.3 Conversion of number system

1. Decimal to binary
Example 1. Convert 147 10 to base two using the division-remainder method.
2|147 1
2| 73 1
2|36 0 so the answer is 100100112
2|18 0
2|9 1
2|4 0
2|2 0
2|1 1
0

Example 2. Convert 0.3437510 to binary with 4 bits to the right of the binary point.
Reading from top to bottom, 0.3437510 = 0.010112 to four binary places. We simply
discard (or truncate) our answer when the desired accuracy has been achieved

0.34375
X2 1
0.68750
X2 1 the answer is 0.010112
1.37500
X2 1
0.75000
X2 1
1.50000
X2 1
1.000000
Example 3 Convert 0.37510 into binary form
0.375×2=0.750
Computer Science Department Admas University
 Computer applications for business management Ch-1

0.750×2=1.500
0.500×2=1.000 (fraction becomes zero)
Therefore 0.37510=0.0112

2. Binary to decimal

Example 1. Convert 1011012 to

base 10(or decimal) number
N10= (1*25) +(0*24) +(1*23) +(1*22) +(0*21) +(1*20)

N10=32+0+8+4+0+1

=4510
Place value 25 24 23 22 21 20
Binary digits 1 0 1 1 0 1

Multiply each digit by its place value

Example 2. Convert 11.0112 to a decimal number.

Solution
Convert the integral and the fractional parts separately then add them up.
1×21= 2.000
1×20= +1.000 Weight 21 20 . 2-1 2-2 2-3
3.000 10 Binary digit 1 1 .0 1 1
then convert the fraction part Values in base 10 2 1 . 0 0.25 0.125

0.011

=0*2-1+1*2-2+1*2-3 =0+1*1/22+1*1/23
=0+1*0.25+1*0.125
=0.25+0.125
=0.37510
Therefore, answer is 3.37510
3. octal number to binary or Vice Versa
Example 1. Convert octal number 3218 to its binary equivalent

 Solution
 Working from right to the left, each octal number is represented using three digits and then
combined we get the final binary equivalent. Therefore:

 3=0112 3 2 1
 2=0102
011 010 001
 1=0012
• Combining the three from left to right
3218 =0110100012
Computer Science Department Admas University
 Computer applications for business management Ch-1

Example 2. Convert 001011110000 to octal

Group the bits into three bits from right to left and change them to octal
So 001-> 1
011->3
110->6
000->0
(1360)8

4. Hexadecimal number to binary or vice versa

Example 1. Convert Hexadecimal number 32A16 to its binary equivalent

 Solution
 Working from right to the left, each Hexa number is represented using four digits and then
combined we get the final binary equivalent. Therefore:

 3=00112 3 2 1
 2=00102
011 010 001
 A=10102
• Combining the three from left to right
3218 =0011001010102

Example 2. Convert 001011110000 to Hexadecimal

Group the bits into three bits from right to left and change them to octal
So 001-> 1
011->3
110->6
000->0
(1360)8

 Convert 1100100111012 to octal and hexadecimal.

110 010 011 1012 = 62358 Separate into groups of 3 for octal conversion
1100 1001 11012 = C9D16 Separate into groups of 4 for octal conversion

1.4 Decimal to hexadecimal vice versa

Decimal to hexadecimal conversion can be achieved by applying the repeated division and remainder algorithm.
Simply put, the decimal number is repeatedly divided by the radix 16. In between these divisions, the
remainders give the hex equivalent in reverse order.
Here is how to convert decimal to hex step by step:
Step 1: If the given decimal number is less than 16, the hex equivalent is the same. Remembering that the letters
A, B, C, D, E and F are used for the values 10, 11, 12, 13, 14 and 15, convert accordingly. For example, the
decimal number 15 will be F in hex.
Step 2: If the given decimal number is 16 or greater, divide the number by 16.
Step 3: Write down the remainder.
Computer Science Department Admas University
 Computer applications for business management Ch-1

Step 4: Divide the part before the decimal point of your quotient by 16 again. Write down the remainder.
Step 5: Continue this process of dividing by 16 and noting the remainders until the last decimal digit you are left
with is less than 16.
Step 6: When the last decimal digit is less than 16, the quotient will be less than 0 and the remainder will be the
digit itself.
Step 7: The last remainder you get will be the most significant digit of your hex value while the first
remainder from Step 3 is the least significant digit. Therefore, when you write the remainders in reverse
order - starting at the bottom with the most significant digit and going to the top- you will reach the hex
value of the given decimal number.

4253 ÷ 16 = 265.8125
0.8125 * 16 = 13 (Remainder 13, equivalent to D in hexadecimal)
265 ÷ 16 = 16.5625
0.5625 * 16 = 9 (Remainder 9)
16 ÷ 16 = 1 (Remainder 0)
1 ÷ 16 = 0.0625
0.00625 * 16: 1 (Remainder 1)

Read the remainders from the most significant to the least - from bottom to top: 109D.
109D the hex equivalent of (4253)10

Example 2 Convert (109D) 16 to decimal

130291D0 =1*163+0*162+9*161+13*160=4096+144+13 =4253

1.5 Decimal to Octal vice versa

Decimal to octal conversion can be achieved by applying the repeated division and remainder
algorithm. Simply put, the decimal number is repeatedly divided by the radix 8. In between these
divisions, the remainders give the octal equivalent in reverse order.
Here is how to convert decimal to octal step by step:
▪ Step 1: If the given decimal number is less than 8, the octal equivalent is the same. If the given
number is greater than 7, divide the number by 8.
▪ Step 2: Write down the remainder.
▪ Step 3: Divide the part before the decimal point of your quotient by 8 again.
▪ Step 4: Write down the remainder.
▪ Step 5: Continue this process of dividing by 8 and noting the remainders until the last decimal digit
you are left with is less than eight.
▪ Step 6: When the last decimal digit is less than eight, the quotient will be less than 0 and the
remainder will be the digit itself.
Computer Science Department Admas University
 Computer applications for business management Ch-1

▪ Step 7: The last remainder you get will be the most significant digit of your octal value while the first
remainder from Step 3 is the least significant digit. Therefore, when you write the remainders in
reverse order - starting at the bottom with the most significant digit and going to the top- you will
reach the octal value of the given decimal number.
Example 1: (1465)10 = (2671)8

1465 ÷ 8 = 183.125
0.125 * 8 = 1 (Remainder: 1)
183 ÷ 8 = 22.875
0.875 * 8 = 7 (Remainder 7)
22 ÷ 8 = 2.75
0.75 * 8 = 6 (Remainder 6)
2 ÷ 8 = 0.25
0.25 *8 = 2 (Remainder 2)
Read the remainder from the most significant to the least - from bottom to top: 2671.
This is the octal equivalent of (1465)10

Computer Science Department Admas University