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






2. 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






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






4. The rules describe the setting of the game - the actions the players may take - and the consequences of those actions; -Advertising and R&D are also prisoners' dilemmas

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






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






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






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






9. Operates like the alleged Mafia. Region division of the market among the firms in the industry






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






11. All firms and individuals willing and able to buy or sell a particular product






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






13. When a manager makes a noncooperative decision






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






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






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






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






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






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. 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






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






22. A measure of the difference between price and marginal cost as a fraction of the product's price. L=(P-MC)/P - refactoring gives: P=MC(1/(1-L)) - which gives us the "1/(1-L)" markup factor






23. 1/(1+i)n






24. Price of a product that enables its producer to obtain a normal profit & that is equal to the ATC of producing it






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






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






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






28. 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






29. A representation of a game that summarizes the players - the information available to them at each stage - the strategies available to them - the sequence of moves - and the payoffs resulting from alternative strategies






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






31. 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






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






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






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






35. 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






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






37. Price Sensitive






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






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






40. Both players have dominant strategies and play them






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






42. Steel - autos - colas - airlines






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






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






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






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






47. Identical or substitutable






48. A business arrangement in which two or more firms undertake a specific economic activity together. Once the activity is over - the firms go their own way






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






50. 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