Question 1

What is the primary use of a best alternative to the negotiated agreement (BANTA)?

Accepted Answer

The answer of What is the primary use of a...

Question 2

Say a seller has a target price of $550,000 and a reservation price of $500,000, and a buyer has a target price of $460,000 and a reservation price of $510,000. What is the zone of potential agreement (ZOLA)?

Accepted Answer

The zone of potential agreement (ZPA) or zone of possible agreement (ZOPA) is the range between the seller's lowest acceptable price (reservation price) and the buyer's highest acceptable price (reservation price). In this case, the seller's reservation price is $500,000 and the buyer's reservation price is $510,000, making the ZOPA $500,000 - $510,000.

Question 3

Using a pattern of slowly decreasing concessions can be used to signal a seller's reservation price.

Accepted Answer

This negotiation tactic involves making progressively smaller concessions, which can indicate to the buyer the point at which the seller is no longer willing to lower their price, effectively signaling the seller's reservation price.

Quiz 6: The Social Psychology of Negotiation

What is the primary use of a best alternative to the negotiated agreement (BANTA) ?

Say a seller has a target price of $550,000 and a reservation price of $500,000, and a buyer has a target price of $460,000 and a reservation price of $510,000. What is the zone of potential agreement (ZOLA) ?

Using a pattern of slowly decreasing concessions can be used to signal a seller's reservation price.