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






2. Steel - autos - colas - airlines






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






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






5. 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






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






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






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






9. Price Sensitive






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






11. An oligopoly in which the firms produce a differentiated product






12. A simpler way to operationalize first-degree price discrimination






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






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






15. 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






16. Both players have dominant strategies and play them






17. 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.)






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






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






21. Toothpaste - shampoo - restaurants - banks






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






23. 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






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






25. 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






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






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






28. If production of a good requires a particular input - then control of that input can be a barrier to entry






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






30. 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






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






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






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






34. 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






35. Demand line is above ATC curve






36. 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






37. Takes Place inside the Mind of the consumer






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






39. When a manager makes a noncooperative decision






40. Multiple firms make the same pricing decisions even though they have not explicitly consulted with each other






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






42. 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






43. Involves price-fixing






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






45. 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






46. Nash equilibrium - the result when each player in a game chooses the action that maximizes his or her payoff given the actions of other players - ignoring the effects of his or her action on the payoffs received by those players (when you confess w






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






48. 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)






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






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