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






2. 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






3. A condition describing a set of strategies in which no player can improve their payoff by unilaterally changing their own strategy given the other player's strategy






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






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






6. 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)






7. Produce identical products






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






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






10. When firms make decisions that make every firm better off than in a noncooperative Nash equilibrium






11. 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






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






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






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






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






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






17. 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)






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






19. 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)






20. 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






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






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






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






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






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






26. Ignoring the effects of their actions on each others' profits






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






28. The price that is low enough to deter entry






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






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






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






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






33. 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






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






35. The actions by persons - firms - or unions to gain special benefits from government at taxpayer's or someone else's expense






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






37. 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






38. 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






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






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






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






42. 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






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






44. 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






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






46. 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






47. 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






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






49. 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






50. Involves price-fixing







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