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. 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






2. When a manager makes a noncooperative decision






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






4. 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






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






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






7. 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.)






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






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






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






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






12. Pricing strategy in which a firm optimally sets the internal price at which an upstream division wells an input to a downstream division






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






14. 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

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15. Price Sensitive






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






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






18. 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)






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






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






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






22. 1/(1+i)n






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






24. 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






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






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






27. 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






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






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






30. Toothpaste - shampoo - restaurants - banks






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






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






33. The price that is low enough to deter entry






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






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






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






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






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






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






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






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






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






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






44. When no one firm has a monopoly - but producers nonetheless realize that they can affect market prices. Firms compete but possess market power






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






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






47. Identical or substitutable






48. A few firms produce most market output - Products may or may not be differentiated - Effective entry barriers protect firm profitability - Firm interdependence requires strategic thinking






49. Revenue-Costs






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