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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. 1/(1+i)n






2. The derivative of total revenue






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






4. Simultaneous move game that is not repeated






5. 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






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






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






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






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






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






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






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






13. 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






14. 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






15. Rules - strategies - payoffs - outcomes






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






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






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






19. 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






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






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






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






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






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






25. 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






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






27. 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






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






29. The price that is low enough to deter entry






30. A combination of two or more companies into one company






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






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






33. Toothpaste - shampoo - restaurants - banks






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






35. 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






36. When managers are able to charge each consumer their reservation price. Examples are car and home sales






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






38. In game theory - a decision rule that describes the actions a player will take at each decision point






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






40. 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






41. 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






42. Steel - autos - colas - airlines






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






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






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






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






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






48. 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






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






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