Test your basic knowledge |

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. The practice of charging different prices to consumers for the same good or service






2. Rules - strategies - payoffs - outcomes






3. 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






4. A situation in which competing firms must make their individual decisions without knowing the decisions of their rivals






5. When managers are able to charge each consumer their reservation price. Examples are car and home sales






6. A measure of market power - the percentage of all sales that is accounted for by the four or eight largest firms in the market






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






8. The price that is low enough to deter entry






9. Game in which one player makes a move after observing the other player's move






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






11. The competition for sales between the products of one industry and the products of another industry






12. Sellers can identify different types of customers and offer each a different price. Examples are special prices for students or the elderly






13. Actions taken by a firm to achieve a goal - such as maximizing profits






14. A merger between firms who have a buyer/supplier relationship. Example: BF Goodrich merging with rubber plantations






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






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






17. Where a firm can charge different groups of consumers different prices for the same product. Example: student or senior discounts






18. 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






19. Simultaneous move game that is not repeated






20. A trigger strategy that punishes after an episode of cheating and returns to cooperation if cheating ends






21. The percentage of the total industry sales accounted for by the four largest firms in the industry. OUTPUT of 4 largest firms over TOTAL output in industry. C4=(S1+...+S4)/St or (w1+...+w4)






22. First firm to set its output (Stackelberg's model)






23. Face competition from companies that currently are not in the market but might enter






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






25. An equilibrium in a game in which players do not cooperate but pursue their own self-interest






26. Variations on one good so that a firm can increase market sharea






27. 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






28. Steel - autos - colas - airlines






29. Specific assets - Economies of scale - Excess capacity - Reputation effects






30. Operates like the alleged Mafia. Region division of the market among the firms in the industry






31. When firms limit production and raise prices in a way that raises each others' profits - even though they have not made any formal agreement






32. All firms and individuals willing and able to buy or sell a particular product






33. The competition that domestic firms encounter from the products and services of foreign producers






34. Each seller can sell all he wants to sell at the going price - Buyers and sellers are price takers - The goods offered by the different sellers are largely the same - The actions of any single buyer or seller will have a negligible impact on the m






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






36. A representation of a game that summarizes the players - the information available to them at each stage - the strategies available to them - the sequence of moves - and the payoffs resulting from alternative strategies






37. An oligopoly in which the firms produce a standardized product






38. The derivative of total revenue






39. An establishment firm commits to setting price below the profit-maximizing level to prevent entry






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






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






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






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






45. If buyers have enough bargaining power - they can insist on lower prices - higher-quality products - or additional services






46. Cooperation among firms that does not involve an explicit agreement






47. Long-run marginal cost curve above long-run average cost






48. The physical characteristics of the market within which firms interact






49. Demand line is above ATC curve






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