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






2. Single firm is sole producer of a product for which there are no close substitutes






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






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






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






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






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






8. Game in which one player makes a move after observing the other player's move






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






10. When an upstream divisions leverages "monopoly like" power to charge higher marginal cost to a downstream division - resulting in failure of the firm to optimize profits based on the wrong quantity decision at the firms level






11. Competition based on factors that are not related to price - such as product quality - service and financing - business location - and reputation






12. A situation where one firm is able to provide a service at a lower cost than could several competing firms






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






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






16. Produce identical products






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






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






19. 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






20. A merger between two firms in the same industry. Example: 2004 K-Mart merged with Sears






21. Steel - autos - colas - airlines






22. Specific assets - Economies of scale - Excess capacity - Reputation effects






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






24. A merger of firms in unrelated industries. Example: If Purina Dow Chow merged with Pampers Diaper Company






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






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






27. Revenue-Costs






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






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






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






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






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






33. 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






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






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






36. 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






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






39. Intense competition in which competitors cut retail prices to gain business--oligopolistic competition






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






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






42. Where a firm can charge different groups of consumers different prices for the same product. Example: student or senior discounts






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






45. A market in which: (1) all have access to the same technology; (2) consumers respond quickly to price changes; (3) existing firms cannot respond quickly to entry by lowering their prices; and (4) there are no sunk costs






46. Takes Place inside the Mind of the consumer






47. Involves price-fixing






48. 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






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






50. 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