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Business Competition

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. A situation in which no one wants to change his or her behavior






2. The price of a product that results in the most efficient allocation of an economy's resources and that is equal to the marginal cost of the product






3. Keeps the price just where it is to maximize profit






4. Nash equilibrium - the result when each player in a game chooses the action that maximizes his or her payoff given the actions of other players - ignoring the effects of his or her action on the payoffs received by those players (when you confess w






5. Each firm believes that if it raises its price - its competitors will not follow - but if it lowers its price all of its competitors will follow; -a model in which firms in an oligopoly match price cuts by other firms - but do not match price hike






6. The players end up worse off than they would if they were able to cooperate; -the pursuit of self-interest does not promote the social interest in these games






7. Ranks industries according to how much social welfare would improve if the output in an industry were increased by a small amount






8. A table that shows the payoffs for every possible action by each player for every possible action by the other player






9. Ignoring the effects of their actions on each others' profits






10. Simultaneous move game that is not repeated






11. Sets the price at the highest level that is consistent with keeping the potential entrant out. -The strategy of reducing the price to deter entry






12. Pricing strategy in which identical products are packaged together in order to enhance profits by forcing customers to make an all-or-none decision to purchase






13. The exclusive right to a product for a period of 20 years from the date the product is invented






14. Toothpaste - shampoo - restaurants - banks






15. Pricing strategy in which a firm intentionally varies its price in an attempt to "hide" price information from consumers and rivals






16. Identical or substitutable






17. Demand line is above ATC curve






18. Rival who sets its output after the leader (Stackelberg's model)






19. Produce identical products






20. Produce differentiated products. Make a profit or take a lost in the short run - in the long run the firm will break even. (MOST number of firms.)






21. Set marginal cost for the cartel equal to marginal revenue for the cartel; -cartel's marginal cost curve is the horizontal sum of the MC curves of the two firms; -Marginal revenue curve is like that of a monopoly






22. A merger of firms in unrelated industries. Example: If Purina Dow Chow merged with Pampers Diaper Company






23. Game in which each player makes decisions without knowledge of the other player's decisions






24. Pricing strategy in which higher prices are charged during peak hours than during off-peak hours






25. Industry in which (1) few firms serving many customers; (2) firms produce identical products t constant marginal cost; (3) firms compete in price and react optimally to competitor's prices; (4) consumers have perfect information and here are no trans






26. 1/(1+i)n






27. A situation in which a change in price strategy by one firm affects sales and profits of another






28. An oligopoly in which the firms produce a differentiated product






29. A table showing - for every possible combination of decisions players can make - the outcomes or "payoffs" for each of the players in each decision combination






30. When an upstream divisions leverages "monopoly like" power to charge higher marginal cost to a downstream division - resulting in failure of the firm to optimize profits based on the wrong quantity decision at the firms level






31. Takes Place inside the Mind of the consumer






32. A strategy that guarantees the highest payoff given the worst possible scenario






33. Single firm is sole producer of a product for which there are no close substitutes






34. If many firms can supply an input and the input is not specialized - the suppliers are unlikely to have the bargaining power to limit a firm's profits






35. In game theory - benefit obtained by party that moves first in a sequential game






36. A strategy that is contingent on the past play of a game and ion which some particular past action "triggers" a different action by a player






37. An attempt by a firm to convince buyers that its product is different from the products of other firms in the industry






38. Price Sensitive






39. When something can be consumed without reducing the benefits available for subsequent consumption; can be consumed without supporting rivalry between consumers






40. A condition describing a set of strategies that constitutes a Nash equilibrium and allows no player to improve their own payoff at any stage of the game by changing strategies






41. Many buyers and sellers - product homogeneity - low cost and accurate information - free entry and exit - best regarded as a benchmark






42. Rules - strategies - payoffs - outcomes






43. An oligopoly in which the sales of the leading (top four) firms are distributed unevenly among them






44. The practice of bundling several different products together and selling them at a single "bundle" price






45. Physical differences - Convenience - Ambience - Reputations - Appeals to vanity - Unconscious fears and desires - Snob appeal - Customized products






46. A measure of the sensitivity to price of a product group as a whole relative to the sensitivity of the quantity demanded of a single firm to a change in its price. R=Et/Ef






47. An industry where (1) there are few firms serving many customers; (2) firms produce differentiated products; (3) each firm believes rivals will respond to price reductions but will not follow price increases; and (4) barriers to entry exist






48. Occurs when a firm produces output - whatever its level - at a higher cost than is necessary to produce it






49. The situation when a firm's long-run average costs fall as it increases output






50. Industry in which (1) there are few firms serving many customers; (2) firms produce either differentiated or homogenous products; (3) a single (leader) firm chooses an output quantity before their rivals select their outputs; (4) all other (follower)






Can you answer 50 questions in 15 minutes?



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