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Test your basic knowledge |
Business Competition
Start Test
Study First
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. Competition based on factors that are not related to price - such as product quality - service and financing - business location - and reputation
Merger
Horizontal Merger/Integration
Strategy
Nonprime competition
2. 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
Duopoly
Mutual interdependence
Trigger strategy
The Threat from Potential Entrants Firms
3. Takes Place inside the Mind of the consumer
Monopoly (characteristics)
Product Differentiation
Perfect Competitor Characteristics
Unbalanced Oligopoly
4. Ignoring the effects of their actions on each others' profits
Secure strategy
Homogenous oligopoly
Non-cooperative behavior
Tacit collusion
5. The derivative of total revenue
Profit
Marginal Revenue
Kinked demand curve model
Follower
6. A trigger strategy that punishes after an episode of cheating and returns to cooperation if cheating ends
Tit-for-tat strategy
Nash equilibrium
Fair return price
Mixed (randomized) strategy
7. In game theory - game where parties make their moves in turn - one party making the first move followed by the other
Sequential game
Rent-seeking behavior
Present Value (PV)
One-shot game
8. Steel - autos - colas - airlines
Business strategy
Examples of Oligopoly
Mixed (randomized) strategy
Tacit collusion
9. A situation in which neither firm has incentive to change its output given the other firm's output
Stackelberg oligopoly
The Threat from Potential Entrants Firms
Cournot equilibrium
Tacit collusion
10. 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
Common knowledge
Nonprime competition
Fair return price
Kinked-demand curve
11. 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
Socially optimal price
Kinked demand curve model
Contestable market
Rent-seeking behavior
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
Empty threat
Covert Collusion
Fair return price
Block pricing
13. The reward received by a player in a game - such as the profit earned by an oligopolist
Equilibrium
Payoff
Inter-industry competition
Fair return price
14. The practice of bundling several different products together and selling them at a single "bundle" price
Payoff table
Payoff
Commodity bundling
Socially optimal price
15. Where a firm can charge different groups of consumers different prices for the same product. Example: student or senior discounts
Third-degree price discrimination
Business strategy
The Threat from Potential Entrants Firms
Examples of Oligopoly
16. When managers are able to charge each consumer their reservation price. Examples are car and home sales
Monopoly (characteristics)
What is game?
Second-Degree Price Discrimination
First-Degree Price Discrimination (Perfect)
17. An oligopoly in which the firms produce a differentiated product
Perfect Competition Barriers to Entry
Dominant firm oligopoly
Differentiated oligopoly
Covert Collusion
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
Undifferentiated
Nonprime competition
Socially optimal price
Perfect Competition Short Run Supply
19. An equilibrium in a game in which players do not cooperate but pursue their own self-interest
Monopoly (characteristics)
No cooperative equilibrium
Dominant firm oligopoly
Cheating
20. Identical or substitutable
Undifferentiated
Import competition
Monopolistic Characteristics:
Dominant strategy
21. An oligopoly in which the sales of the leading (top four) firms are distributed unevenly among them
Unbalanced Oligopoly
Commodity bundling
Equilibrium
Stackelberg oligopoly
22. 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
Subgame perfect equilibrium
Collusion
Primary Sources of Monopolistic Power
Non-cooperative equilibrium
23. 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
Bertrand oligopoly
Kinked demand curve model
Non-rivalrous consumption
Second-Degree Price Discrimination
24. An oligopoly in which the firms produce a standardized product
Oligopoly
Network effects
Inefficiency
Homogenous oligopoly
25. In game theory - a statement of harmful intent by one party that the other party views as believable-- "if you do this - we will do that"
Block pricing
Tacit collusion
The Threat from Potential Entrants Firms
Credible threat
26. A merger between firms who have a buyer/supplier relationship. Example: BF Goodrich merging with rubber plantations
Extensive-form game
Vertical Merger
Follower
Minimum efficient scale (full capacity)
27. 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
Bargaining Power of Suppliers
Equilibrium
Natural Monopoly (local phone or electric company)
Perfect Competition Long Run Supply
28. In game theory - benefit obtained by party that moves first in a sequential game
Cheating
First-mover advantage
Tacit collusion
Non-price competition
29. Single firm is sole producer of a product for which there are no close substitutes
Bargaining Power of Suppliers
Third-Degree Price Discrimination
Payoff matrix
Pure monopoly
30. When firms limit production and raise prices in a way that raises each others' profits - even though they have not made any formal agreement
Equilibrium
Tacit collusion
Unbalanced Oligopoly
Limit price
31. If production of a good requires a particular input - then control of that input can be a barrier to entry
Trigger strategy
Payoff matrix
Ownership of a Key Input
Sweezy oligopoly
32. A merger between two firms in the same industry. Example: 2004 K-Mart merged with Sears
Price war
Perfect Competition Short Run Supply
Horizontal Merger/Integration
Tit-for-tat strategy
33. Revenue-Costs
Strategic behavior
Socially optimal price
Profit
First-Degree Price Discrimination (Perfect)
34. Specific assets - Economies of scale - Excess capacity - Reputation effects
Implicit Collusion
Perfect Competition Barriers to Entry
Undifferentiated
Commodity bundling
35. 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
Payoff
Normal-form game
Four-firm concentration ratio
Oligopoly
36. Sellers can identify different types of customers and offer each a different price. Examples are special prices for students or the elderly
Product differentiation
Third-Degree Price Discrimination
Pure monopoly
Cooperative equilibrium
37. A measure of market power - the percentage of all sales that is accounted for by the four or eight largest firms in the market
Concentration Ratio
Product Differentiation
Non-rivalrous consumption
Two-part pricing
38. All firms and individuals willing and able to buy or sell a particular product
Horizontal Merger/Integration
Market
Non-price competition
Merger
39. Price of a product that enables its producer to obtain a normal profit & that is equal to the ATC of producing it
Cutthroat Competition
Rent-seeking behavior
Fair return price
Strategic behavior
40. The physical characteristics of the market within which firms interact
Cournot oligopoly
Dominant firm oligopoly
Transfer pricing
Market Structure
41. A condition describing a set of strategies in which no player can improve their payoff by unilaterally changing their own strategy given the other player's strategy
Price war
Nash equilibrium
Dansby-Willig performance index
Covert Collusion
42. Operates like the alleged Mafia. Region division of the market among the firms in the industry
Open Collusion
Indefinitely repeated game
Dominant strategy equilibrium
Perfect Competition Barriers to Entry
43. The actions by persons - firms - or unions to gain special benefits from government at taxpayer's or someone else's expense
Rent-seeking behavior
Monopolistic Competition
Monopolistic Characteristics:
Brand Multiplication
44. A combination of two or more companies into one company
Natural Monopoly (local phone or electric company)
Simultaneous-move game
Horizontal Merger/Integration
Merger
45. Intense competition in which competitors cut retail prices to gain business--oligopolistic competition
Tacit collusion
Price war
Socially optimal price
Barrier to entry
46. A game that is played over and over again forever and in which players receive payoffs during each play of the game
Import competition
Monopolistic Characteristics:
Indefinitely repeated game
First-Degree Price Discrimination (Perfect)
47. A situation in which competing firms must make their individual decisions without knowing the decisions of their rivals
Nash equilibrium
Simultaneous decision games
Transfer pricing
Fair return price
48. A strategy or action that always provides the best outcome no matter what decisions rivals make
Perfect Competition Long Run Supply
Price discrimination
Dominant strategy
Undifferentiated
49. Ranks industries according to how much social welfare would improve if the output in an industry were increased by a small amount
Rent-seeking behavior
Business strategy
Dansby-Willig performance index
Normal-form game
50. Game in which one player makes a move after observing the other player's move
Open Collusion
Sequential-move game
Non-cooperative behavior
Competitive market