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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 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






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






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






4. 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)






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






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






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






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






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






10. 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






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






12. An industry where (1) there are few firms serving many customers; (2) firms produce differentiated products; (3) each firm believes rivals will respond to price reductions but will not follow price increases; and (4) barriers to entry exist






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






14. 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






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






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






17. 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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18. A simpler way to operationalize first-degree price discrimination






19. 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






20. 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






21. Involves price-fixing






22. An oligopoly in which the sales of the leading (top four) firms are distributed unevenly among them






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






24. 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






25. 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






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






27. 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






28. A firm whose price decisions are tacitly accepted and followed by others in the industry






29. 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






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






31. 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






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






33. Rules - strategies - payoffs - outcomes






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






35. 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






36. 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






37. Demand line is above ATC curve






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






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






40. 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






41. A merger between firms who have a buyer/supplier relationship. Example: BF Goodrich merging with rubber plantations






42. Revenue-Costs






43. 1/(1+i)n






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






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






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






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






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






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






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







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Can you answer 50 questions in 15 minutes?


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