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






2. A merger between two firms in the same industry. Example: 2004 K-Mart merged with Sears






3. 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






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






5. 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






6. The derivative of total revenue






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






8. 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)






9. When each firm has an incentive to cheat - but both are worse off if both cheat -- illustrates why cooperation is difficult to maintain even when it is mutually beneficial to do so

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


10. Increases in the value of a product to each user - including existing users - as the total number of users rises






11. 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"






12. 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






13. An equilibrium in a game in which players cooperate to increase their mutual payoff






14. 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






15. Multiple firms produce similar products - Firms face downward sloping demand curves - Profit maximization occurs where MC=MR - With free entry and exit - firms compete away economic profits






16. Marginal cost curve above average variable cost - P* = SRMC






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






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






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






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






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






22. Different units of a product are sold at different prices. Examples are buying in bulk - or - commodity-bundling






23. 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






24. 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






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






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






27. 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






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






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






30. A situation in which all decision makers know the payoff table - and they believe all other decision makers also know the payoff table






31. 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






32. 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






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






34. In game theory - game where parties make their moves in turn - one party making the first move followed by the other






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






36. The actions by persons - firms - or unions to gain special benefits from government at taxpayer's or someone else's expense






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






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






39. 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






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






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






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






43. Pricing strategy in which consumers are charged a fixed fee for the right to purchase a product - plus a per-unit charge for each unit purchased






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






45. Price Sensitive






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






47. Intense competition in which competitors cut retail prices to gain business--oligopolistic competition






48. 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






49. Toothpaste - shampoo - restaurants - banks






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