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






2. 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






3. 1/(1+i)n






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






5. Physical differences - Convenience - Ambience - Reputations - Appeals to vanity - Unconscious fears and desires - Snob appeal - Customized products






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






7. Where a firm can charge different groups of consumers different prices for the same product. Example: student or senior discounts






8. 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)






9. First firm to set its output (Stackelberg's model)






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






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






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






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






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






15. A strategy whereby a player randomizes over two or more available actions in order to keep rivals from being able to predict his action






16. 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






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






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






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






20. A representation of a game that summarizes the players - the information available to them at each stage - the strategies available to them - the sequence of moves - and the payoffs resulting from alternative strategies






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






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






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






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






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






27. 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






28. Using advertising and other means to try to increase a firm's sales






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






30. A strategy in which a firm advertises a price and a promise to match any lower prices offered by a competitor






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






32. 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






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






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






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






36. 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






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






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






39. Involves price-fixing






40. 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






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






42. When the decisions of two or more firms significantly affect each others' profits






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






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






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






46. An agreement among firms in a market about quantities to produce or prices to charge in attempts to limit competition






47. 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






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






49. 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)






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







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