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






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






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






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






5. A firm whose price decisions are tacitly accepted and followed by others in the industry






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






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






8. 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






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






10. 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






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






12. 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






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






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






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






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






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






18. 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)






19. Rules - strategies - payoffs - outcomes






20. (1) Economies of Scale; (2) Economies of Scope; (3) Cost Complementarity; and (4)Patents & Other Legal Barriers






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






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






23. 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






24. The practice of charging different prices to consumers for the same good or service






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






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






27. Actions taken by a firm to achieve a goal - such as maximizing profits






28. An equilibrium in a game in which players do not cooperate but pursue their own self-interest






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






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. 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






32. 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






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






34. All firms and individuals willing and able to buy or sell a particular product






35. 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






36. A situation in which a change in price strategy by one firm affects sales and profits of another






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






38. Toothpaste - shampoo - restaurants - banks






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






40. Variations on one good so that a firm can increase market sharea






41. An attempt by a firm to convince buyers that its product is different from the products of other firms in the industry






42. Produce identical products






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






44. Takes Place inside the Mind of the consumer






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






46. A table showing - for every possible combination of decisions players can make - the outcomes or "payoffs" for each of the players in each decision combination






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






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






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






50. 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