Norwest Corporation and Subsidiaries - Page 5

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          Executable code is composed of sequences of binary digits (zeros            
          and ones).  Each digit is called a “bit”, and eight-bit sequences           
          are called “bytes”.3  A computer program can be written onto a              
          magnetic disk or tape by encoding its particular executable code            
          on the surface of the disk or tape.4  That magnetic recording               
          allows the computer processor to read the executable code and to            
          perform the specific tasks directed by the code.                            
               Generally, the cost of a blank tape, similar to one upon               
          which the computer programs acquired by petitioner were placed,             
          was less than $25 during the years in issue.  An encoded computer           
          program can easily be transferred or copied onto additional blank           
          tapes and disks, resulting in identical reproductions of the                
          program.  A computer program can also reside on media other than            
          magnetic tapes and disks, such as punch cards and CD-ROMs                   




          3    For example, in the American Standard Code for Information             
          Interchange (ASCII), the binary representation for the letter “A”           
          is 01000001, and the binary representation for the letter “Z” is            
          01011010.                                                                   
          4    The surface of the computer disk or tape is magnetically               
          encoded with the executable code by magnetizing the crystals or             
          particles in the recording medium corresponding to the sequence             
          of zeros and ones making up the binary system of executable code.           
          For example, under the “nonreturn to zero inverted” (NRZI)                  
          encoding method, every zero is represented on the disk or tape by           
          a magnet pointing in a certain direction, and every one by a                
          magnet pointing in the opposite direction.  The amount of                   
          information contained on a disk or tape is a function of the                
          magnetic recording density of the disk or tape.  The information            
          on the disk or tape is interpreted by the computer when the                 
          magnetic bits are converted into electrical signals.                        




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Last modified: May 25, 2011