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






2. Revenue-Costs






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






4. A representation of a game indicating the players - their possible strategies - and the payoffs resulting from alternative strategies






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






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






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






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






9. 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)






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






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






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






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






14. If buyers have enough bargaining power - they can insist on lower prices - higher-quality products - or additional services






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






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






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






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






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






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






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






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






23. Both players have dominant strategies and play them






24. Face competition from companies that currently are not in the market but might enter






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






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






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






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






29. 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






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






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






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






33. 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






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






35. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






36. 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)






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






38. 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






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






40. Ranks industries according to how much social welfare would improve if the output in an industry were increased by a small amount






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






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






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






44. 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






45. Identical or substitutable






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






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






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






49. 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)






50. 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






Can you answer 50 questions in 15 minutes?



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