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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 competition for sales between the products of one industry and the products of another industry






2. 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






3. 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






4. 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






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






6. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






7. Involves price-fixing






8. When a manager makes a noncooperative decision






9. Produce identical products






10. Price of a product that enables its producer to obtain a normal profit & that is equal to the ATC of producing it






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






12. 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






13. When firms make decisions that make every firm better off than in a noncooperative Nash equilibrium






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






15. 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






16. A business arrangement in which two or more firms undertake a specific economic activity together. Once the activity is over - the firms go their own way






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






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






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






20. Maximize economic profit by producing the quantity at which MC=MR






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






22. In game theory - a decision rule that describes the actions a player will take at each decision point






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






24. Revenue-Costs






25. A situation in which neither firm has incentive to change its output given the other firm's output






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






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






28. 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






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






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






31. The price that is low enough to deter entry






32. A simpler way to operationalize first-degree price discrimination






33. Identical or substitutable






34. A table that shows the payoffs that each firm earns from every combination of strategies by the firms






35. Anything that keeps new firms from entering an industry in which firms are earning economic profits (e.g. Ownership of a Key Input - Capital - Patents - Economies of scale)






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






37. In game theory - a statement of harmful intent easily dismissed by recipient because threat not considered believable






38. Multiple firms make the same pricing decisions even though they have not explicitly consulted with each other






39. The maximum price that a buyer is willing to pay for a good - or the minimum price that a seller will accept






40. Single seller in an industry - Strong barriers to entry - Profit maximization - faces market demand and sets MR=MC - Unexploited gains from trade






41. Both players have dominant strategies and play them






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






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






44. A combination of two or more companies into one company






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






46. Industry where (1) there are few firms serving many customers; (2) firms produce either differentiated or homogenous products; (3) each form believes rivals will hold their output constant if it changes its output; and (4) barriers to entry exist. Fi






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






48. 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






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






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