Page 212 - Encyclopedia of Business and Finance

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DATABASES their ability to manipulate the data. It is possible to do a

Databases are designed to manipulate large amounts of number of functions with a database that would be more
information by inputting, storing, retrieving, and manag- difficult to do with a spreadsheet. Consider these actions
ing that information. Databases use a table format, with that are possible to do with a database:
Microsoft Access being one of the most widely used.
• Perform a variety of cross-referencing activities
Databases consist of rows and columns. Each piece of
information is entered into a row, which creates a • Complete complicated calculations
“record.” Databases are commonly used when saving
• Bring current records up to date
addresses or other types of long lists of information. Once
the records are created in the database, they can be sorted • Retrieve large amounts of information that match
and manipulated in a variety of ways that are limited pri- certain criteria
marily by the software being used.
The word data is normally defined as facts from RELATIONAL DATABASES
which information can be derived. For example, “Fred Most modern databases are relational, meaning that data
Crouse lives at 2209 Maple Avenue” is a fact. A database are stored in tables, consisting of rows and columns, and
may contain millions of such facts. From these facts the
that data in different tables are related by the meanings of
database management system (DBMS) can derive infor-
certain common columns. (The tables in a database are
mation in the form of answers to questions such as “How
sometimes called files, the rows are called records, and the
many people live on Maple Avenue?” The popularity of
databases in business is a direct result of the power of columns are called fields. Nevertheless, this is an older ter-
DBMSs in deriving valuable business information from minology, left over from the early days of business com-
large collections of data. puter systems.) The following is an example of a simple
Databases are somewhat similar to spreadsheets, but relational database consisting of three tables: one for cus-
databases are more powerful than spreadsheets because of tomers, one for products, and one for sales:

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