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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 - a decision rule that describes the actions a player will take at each decision point






2. 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






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






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






5. 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






6. Steel - autos - colas - airlines






7. Takes Place inside the Mind of the consumer






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






9. Simultaneous move game that is not repeated






10. 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






11. Identical or substitutable






12. Demand line is above ATC curve






13. Physical differences - Convenience - Ambience - Reputations - Appeals to vanity - Unconscious fears and desires - Snob appeal - Customized products






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






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






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






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






19. 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






20. Sets the price at the highest level that is consistent with keeping the potential entrant out. -The strategy of reducing the price to deter entry






21. 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)






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






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






24. A table showing - for every possible combination of decisions players can make - the outcomes or "payoffs" for each of the players in each decision combination






25. 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






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






27. Toothpaste - shampoo - restaurants - banks






28. Where a firm can charge different groups of consumers different prices for the same product. Example: student or senior discounts






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






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






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






32. Revenue-Costs






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






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






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






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






37. Both players have dominant strategies and play them






38. 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.)






39. 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






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






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






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






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






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






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






46. 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






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






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






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






50. When no one firm has a monopoly - but producers nonetheless realize that they can affect market prices. Firms compete but possess market power