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






2. Increases in the value of a product to each user - including existing users - as the total number of users rises






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






4. Actions taken by a firm to achieve a goal - such as maximizing profits






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






6. Steel - autos - colas - airlines






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






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






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






10. Single seller in an industry - Strong barriers to entry - Profit maximization - faces market demand and sets MR=MC - Unexploited gains from trade






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






12. 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






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






14. 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






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






16. A game that is played over and over again forever and in which players receive payoffs during each play of the game






17. 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






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






19. An equilibrium in a game in which players cooperate to increase their mutual payoff






20. When firms limit production and raise prices in a way that raises each others' profits - even though they have not made any formal agreement






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






22. The price that is low enough to deter entry






23. 1/(1+i)n






24. 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






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






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






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






28. 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






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






30. Demand line is above ATC curve






31. 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






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






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






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






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






36. Price Sensitive






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






38. A situation in which neither firm has incentive to change its output given the other firm's output






39. Revenue-Costs






40. 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






41. 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.)






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






43. Produce identical products






44. 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






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






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






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






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






49. When each firm has an incentive to cheat - but both are worse off if both cheat -- illustrates why cooperation is difficult to maintain even when it is mutually beneficial to do so

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50. A measure of the sensitivity to price of a product group as a whole relative to the sensitivity of the quantity demanded of a single firm to a change in its price. R=Et/Ef