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. Involves price-fixing






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






3. 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






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






5. A merger between firms who have a buyer/supplier relationship. Example: BF Goodrich merging with rubber plantations






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






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






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






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






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






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






12. Pricing strategy in which higher prices are charged during peak hours than during off-peak hours






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






14. 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






15. 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






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






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






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






19. Produce identical products






20. 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






21. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






22. Long-run marginal cost curve above long-run average cost






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






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






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






26. Both players have dominant strategies and play them






27. In game theory - a statement of harmful intent easily dismissed by recipient because threat not considered believable






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






29. Rival who sets its output after the leader (Stackelberg's model)






30. When a manager makes a noncooperative decision






31. Price Sensitive






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






33. 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






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






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






37. The price that is low enough to deter entry






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






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






40. 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






41. 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

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


42. Rules - strategies - payoffs - outcomes






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






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






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






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






47. 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






48. 1/(1+i)n






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






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