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






2. 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






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






4. 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






5. 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






6. 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






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






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






9. The situation that exists when two or more groups need each other and must depend on each other to accomplish a goal that is important to each of them






10. The derivative of total revenue






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






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






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






14. Demand line is above ATC curve






15. In game theory - benefit obtained by party that moves first in a sequential game






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






17. 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






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






19. 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






20. Produce differentiated products. Make a profit or take a lost in the short run - in the long run the firm will break even. (MOST number of firms.)






21. Involves price-fixing






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






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






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






25. 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






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






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






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






29. The price that is low enough to deter entry






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






31. 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






32. 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






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






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






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






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






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






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






39. A table that shows the payoffs that each firm earns from every combination of strategies by the firms






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






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






42. 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)






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






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






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






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






47. Long-run marginal cost curve above long-run average cost






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






49. 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






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