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






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






3. 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






4. 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






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






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






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






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






9. 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






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






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






12. 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






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






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






15. 2 firms - simplest case in an oligopoly. Profits higher if limiting their production






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






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






19. Revenue-Costs






20. 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






21. Actions taken by a firm to achieve a goal - such as maximizing profits






22. 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






23. 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






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






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






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






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






28. When a manager makes a noncooperative decision






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






30. 1/(1+i)n






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. 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






33. A measure of the difference between price and marginal cost as a fraction of the product's price. L=(P-MC)/P - refactoring gives: P=MC(1/(1-L)) - which gives us the "1/(1-L)" markup factor






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






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






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






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






38. 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






39. The competition for sales between the products of one industry and the products of another industry






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






41. 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






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






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






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






45. When the decisions of two or more firms significantly affect each others' profits






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






47. 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






48. 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






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






50. Both players have dominant strategies and play them