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






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






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






4. 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)






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






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






7. 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






8. Demand line is above ATC curve






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






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






11. Pricing strategy in which a firm intentionally varies its price in an attempt to "hide" price information from consumers and rivals






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






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






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






15. 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






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






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






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






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






20. A measure of the difference between price and marginal cost as a fraction of the product's price. L=(P-MC)/P - refactoring gives: P=MC(1/(1-L)) - which gives us the "1/(1-L)" markup factor






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






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






23. A condition describing a set of strategies that constitutes a Nash equilibrium and allows no player to improve their own payoff at any stage of the game by changing strategies






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






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






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






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






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






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






30. 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






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






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






33. 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






34. 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






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






36. A product's ability to satisfy a large number of consumers at the same time






37. Pricing strategy in which identical products are packaged together in order to enhance profits by forcing customers to make an all-or-none decision to purchase






38. 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






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






40. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






41. 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






42. Identical or substitutable






43. 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






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






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






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






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






48. Revenue-Costs






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






50. When a manager makes a noncooperative decision