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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. Price Sensitive






2. 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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3. 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)






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






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






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






7. Rival who sets its output after the leader (Stackelberg's model)






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






9. 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






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






11. Simultaneous move game that is not repeated






12. Industry in which (1) few firms serving many customers; (2) firms produce identical products t constant marginal cost; (3) firms compete in price and react optimally to competitor's prices; (4) consumers have perfect information and here are no trans






13. The players end up worse off than they would if they were able to cooperate; -the pursuit of self-interest does not promote the social interest in these games






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






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






16. Actions taken by firms to plan for and react to competition from rival firms






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






18. A merger between two firms in the same industry. Example: 2004 K-Mart merged with Sears






19. 1/(1+i)n






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






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






22. The exclusive right to a product for a period of 20 years from the date the product is invented






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






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






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






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






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






28. The maximum price that a buyer is willing to pay for a good - or the minimum price that a seller will accept






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






30. 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






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






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






34. Nash equilibrium - the result when each player in a game chooses the action that maximizes his or her payoff given the actions of other players - ignoring the effects of his or her action on the payoffs received by those players (when you confess w






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






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






37. Set marginal cost for the cartel equal to marginal revenue for the cartel; -cartel's marginal cost curve is the horizontal sum of the MC curves of the two firms; -Marginal revenue curve is like that of a monopoly






38. 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






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






40. 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






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






42. A situation in which all decision makers know the payoff table - and they believe all other decision makers also know the payoff table






43. 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






44. When a manager makes a noncooperative decision






45. A strategy whereby a player randomizes over two or more available actions in order to keep rivals from being able to predict his action






46. 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






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






48. The competition that domestic firms encounter from the products and services of foreign producers






49. Many buyers and sellers - product homogeneity - low cost and accurate information - free entry and exit - best regarded as a benchmark






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