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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. The demand curve for a non-collusive oligopolist - which is based on the assumption that rivals will match a price decrease and will ignore a price increase






2. The reward received by a player in a game - such as the profit earned by an oligopolist






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






4. 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






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. In game theory - a game that is played again sometime after the previous game ends






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






8. A pricing strategy in which profits gained from the sale of one product are used to subsidize sales of a related product






9. Toothpaste - shampoo - restaurants - banks






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






11. A situation in which no one wants to change his or her behavior






12. The derivative of total revenue






13. Steel - autos - colas - airlines






14. The situation that exists when two or more groups need each other and must depend on each other to accomplish a goal that is important to each of them






15. A game that is played over and over again forever and in which players receive payoffs during each play of the game






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






17. 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






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






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






20. A few firms produce most market output - Products may or may not be differentiated - Effective entry barriers protect firm profitability - Firm interdependence requires strategic thinking






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






22. 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






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






24. 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






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






26. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






27. A situation where one firm is able to provide a service at a lower cost than could several competing firms






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






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






30. A market in which: (1) all have access to the same technology; (2) consumers respond quickly to price changes; (3) existing firms cannot respond quickly to entry by lowering their prices; and (4) there are no sunk costs






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






32. Produce identical products






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






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






35. 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)






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






38. When no one firm has a monopoly - but producers nonetheless realize that they can affect market prices. Firms compete but possess market power






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






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






41. One large firm that has a significant cost advantage over many other - smaller competing firms; -the large firm operates as a monopoly: setting price and output to maximize profit; -the small firms act as perfect competitors: taking as given the mar






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






43. 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.)






44. Actions taken by firms to plan for and react to competition from rival firms






45. Takes Place inside the Mind of the consumer






46. An agreement among firms in a market about quantities to produce or prices to charge in attempts to limit competition






47. The smallest quantity at which the average cost curve reaches its minimum






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






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






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