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






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






3. 1/(1+i)n






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






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






6. The exclusive right to a product for a period of 20 years from the date the product is invented






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






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






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






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






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






12. Involves price-fixing






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






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






15. 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






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






17. Revenue-Costs






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






19. Toothpaste - shampoo - restaurants - banks






20. 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






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






22. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






23. Variations on one good so that a firm can increase market sharea






24. 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






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






26. Produce identical products






27. Identical or substitutable






28. In game theory - benefit obtained by party that moves first in a sequential game






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






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






31. The competition that domestic firms encounter from the products and services of foreign producers






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






33. The price that is low enough to deter entry






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






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






37. 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






38. 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.)






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






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






41. The situation when a firm's long-run average costs fall as it increases output






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






43. 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






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






45. 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






46. Both players have dominant strategies and play them






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






48. When a manager makes a noncooperative decision






49. 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






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