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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. Toothpaste - shampoo - restaurants - banks






2. 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






3. 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






4. Price Sensitive






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






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






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






8. Both players have dominant strategies and play them






9. 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






10. 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)






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






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






13. When a manager makes a noncooperative decision






14. Revenue-Costs






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






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






17. When an upstream divisions leverages "monopoly like" power to charge higher marginal cost to a downstream division - resulting in failure of the firm to optimize profits based on the wrong quantity decision at the firms level






18. 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






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






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






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






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






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






24. An agreement among firms in a market about quantities to produce or prices to charge in attempts to limit competition






25. 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)






26. Simultaneous move game that is not repeated






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






28. 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






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






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






31. 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






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






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






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






35. The price that is low enough to deter entry






36. 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






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






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






39. The derivative of total revenue






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






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






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






43. 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






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






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






46. 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)






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






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






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






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