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






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






3. 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






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






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






6. In game theory - a statement of harmful intent by one party that the other party views as believable-- "if you do this - we will do that"






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






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






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






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






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






14. Rules - strategies - payoffs - outcomes






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






16. 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






17. Simultaneous move game that is not repeated






18. 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






19. Produce identical products






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






21. The price of a product that results in the most efficient allocation of an economy's resources and that is equal to the marginal cost of the product






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






23. An equilibrium in a game in which players do not cooperate but pursue their own self-interest






24. 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






25. When a manager makes a noncooperative decision






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






27. A trigger strategy that punishes after an episode of cheating and returns to cooperation if cheating ends






28. 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






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






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






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






32. If many firms can supply an input and the input is not specialized - the suppliers are unlikely to have the bargaining power to limit a firm's profits






33. Takes Place inside the Mind of the consumer






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






35. All firms and individuals willing and able to buy or sell a particular product






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






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






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






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






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






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






42. The rules describe the setting of the game - the actions the players may take - and the consequences of those actions; -Advertising and R&D are also prisoners' dilemmas

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






44. Involves price-fixing






45. 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






46. In game theory - a decision rule that describes the actions a player will take at each decision point






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






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






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






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







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