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






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






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






4. A pricing strategy in which profits gained from the sale of one product are used to subsidize sales of a related product






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






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






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






8. A business arrangement in which two or more firms undertake a specific economic activity together. Once the activity is over - the firms go their own way






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






10. 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






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






12. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






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






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






15. The percentage of the total industry sales accounted for by the four largest firms in the industry. OUTPUT of 4 largest firms over TOTAL output in industry. C4=(S1+...+S4)/St or (w1+...+w4)






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






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






18. 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






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






20. Revenue-Costs






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






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






23. Both players have dominant strategies and play them






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






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






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






27. 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






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






29. A situation in which competing firms must make their individual decisions without knowing the decisions of their rivals






30. The derivative of total revenue






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






32. Involves price-fixing






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






34. 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






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






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






37. Simultaneous move game that is not repeated






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






39. 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






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






41. Steel - autos - colas - airlines






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






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






44. Keeps the price just where it is to maximize profit






45. 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






46. Produce differentiated products. Make a profit or take a lost in the short run - in the long run the firm will break even. (MOST number of firms.)






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






48. The situation when a firm's long-run average costs fall as it increases output






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






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