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






2. 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






3. 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






4. The physical characteristics of the market within which firms interact






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






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






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






8. Both players have dominant strategies and play them






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






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






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






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






13. Toothpaste - shampoo - restaurants - banks






14. 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






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






16. 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)






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






18. An industry where (1) there are few firms serving many customers; (2) firms produce differentiated products; (3) each firm believes rivals will respond to price reductions but will not follow price increases; and (4) barriers to entry exist






19. 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






20. The demand curve for a non-collusive oligopolist - which is based on the assumption that rivals will match a price decrease and will ignore a price increase






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






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






23. 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






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






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






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






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






28. The price that is low enough to deter entry






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






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






31. Industry in which (1) there are few firms serving many customers; (2) firms produce either differentiated or homogenous products; (3) a single (leader) firm chooses an output quantity before their rivals select their outputs; (4) all other (follower)






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






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






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






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






36. Revenue-Costs






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






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






39. Price Sensitive






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






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






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






43. Identical or substitutable






44. 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






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






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






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






48. Demand line is above ATC curve






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






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