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






2. A representation of a game indicating the players - their possible strategies - and the payoffs resulting from alternative strategies






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






4. When a manager makes a noncooperative decision






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






6. The rules describe the setting of the game - the actions the players may take - and the consequences of those actions; -Advertising and R&D are also prisoners' dilemmas

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7. The price that is low enough to deter entry






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






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






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






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






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






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






14. 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






15. 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.)






16. A strategy or action that always provides the best outcome no matter what decisions rivals make






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






18. An oligopoly in which the sales of the leading (top four) firms are distributed unevenly among them






19. 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






20. 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)






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






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






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






24. Pricing strategy in which a firm optimally sets the internal price at which an upstream division wells an input to a downstream division






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






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






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






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






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






30. An index of market concentration. Sum of squared market shares of all the firms in the industry times 10K HHI=10 - 000Σwi2






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. 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)






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






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






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






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






37. 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






38. 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






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






40. If production of a good requires a particular input - then control of that input can be a barrier to entry






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






42. Sets the price at the highest level that is consistent with keeping the potential entrant out. -The strategy of reducing the price to deter entry






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






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






45. 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






46. Price Sensitive






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






48. 1/(1+i)n






49. 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

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