Negotiations TEST JAMIE GOAT one Chapters 3/4
Negotiators often use two types of rationales when discussing the value of an item or service. One of these is called a constraint rationale and is best exemplified/demonstrated by the following statement:
"I can't pay more than $35,000 for this car—that's all the budget I have!"
Left to their own devices, negotiators fail to ask diagnostic questions of the counterparty—in fact, only about ________ of negotiators seek information about the other party's preferences during negotiation.
7%
The first offer that falls within the bargaining zone acts as a powerful anchor in negotiations and has a strong effect on the counterparty's counteroffer. Indeed, first offers are so powerful that they correlate at least ________ with the final outcome of the negotiation.
85%
By signaling their willingness to share information about their interests, but not their BATNA, a negotiator can capitalize on the powerful principle of reciprocity. Which of the following situations best illustrates the reciprocity principle?
A car salesman shares information about the town where he grew up, and his customer shares that he also grew up near that town
Sometimes, negotiations break down because negotiators have different beliefs, views, or forecasts that cannot be resolved. Why type of strategy may be useful for leveraging these differences and crafting deals in these types of situations?
A contract in which the outcomes depend on the realization of some future event
Banishing the fixed-pie perception from a negotiation is difficult. Which of the following situations would pose the greatest risk for a negotiator to harbor a fixed-pie perception?
A negotiator who is held responsible for their negotiated outcome when negotiating with an in-group member
In a situation in which you have good information about the negotiation object or service and your counterparty is believed to also have done their research and is knowledgeable about the negotiation, what is recommended as the best, next action to take in the negotiation? Select one: A.Make the opening offer B.Wait or allow the counterparty to make the first offer C.Make your first offer your final offer D.Do more research and improve your knowledge of the counterparty
A. Make the opening offer
When negotiators make proposals that the other party considers extreme, this may cause the chilling effect. For example, if the counterparty opens with an "outrageous" offer, the negotiator should: Select one: A.appeal to norms of fairness B.immediately re-anchor C.reveal his/her reservation price D.lower his/her aspirations
B. immediately re-anchor
Many negotiators prepare for a negotiation by setting goals for their negotiated outcomes. When setting goals, each of the following statements are true possibilities for their negotiation, EXCEPT:
B. negotiators who set nonspecific goals tend to lead to better optimized, win-win agreements than those negotiators who set very specific goals
According to a research study examining post-negotiation satisfaction, negotiators who focus on their ideal outcomes do NOT feel as satisfied as negotiators who focus on their:
BATNA
Sometimes negotiators state a range as an offer rather than a specific number, also known as a point offer. Which of the following types of range offers has the highest success in anchoring the counterparty closest to a negotiator's reservation price?
Bolstering-range
Prior to beginning negotiations, parties are advised to really assess their BATNAs. What is the best way for parties to leverage the power of their BATNAs?
By privately unpacking their multiple alternatives, negotiators can make more aggressive opening offers, and ultimately achieve better outcomes
In negotiation, contingency contracts need to be carefully crafted so as to prevent misunderstanding. This involves several considerations including: enforceability, clarity, ability to be readily evaluated, and: Select one: A.relational accommodation B.ambiguity C.measurability D.the ability for side-deals to be made
C. measurability
Concerning the multiple methods of fair resource division, which of the following statements is TRUE regarding the equity rule?
Distribution should be proportional to a person's contribution
Most negotiators approach negotiations by attempting to negotiate each issue on the table one by one. What is a disadvantage of such single-issue negotiations?
Does not allow negotiators to make tradeoffs between issues
Even though negotiators may make concession in a back-and-forth method, this exchange does not always go smoothly or lead to equal concessions. One method that helps parties avoid escalating conflict to reach mutual settlement within the bargaining zone is the ________ which is based on the reciprocity principle, calls for one party to make a concession and invites the other party to reciprocate by making a concession.
Graduated reduction in tension (GRIT) model
The magnitude of a negotiator's concessions is a powerful communication device. What advice is considered best when making concessions with a counterparty?
Match but don't exceed the concession magnitude of the counterparty
The post-settlement strategy is a method for improving the current negotiation agreement. How does a post-settlement settlement strategy work?
Negotiators agree to keep current agreement, but explore other options with the goal of finding another option that both prefer more than the current one
Unfortunately, many negotiators hold faulty assumptions that prevent the discovery and creation of integrative, win-win agreements. Which of the following strategies are useful in helping negotiators avoid lose-lose agreements?
Negotiators should develop an accurate understanding of the other party's interests
When making multiple equivalent simultaneous offers, which increases the likelihood of all parties discovering integrative solutions, what one rule should the offerer of the MESO make clear to the counterparty?
No cherry-picking terms from each option that best suits the counterparty
Pre-settlement settlements (PreSS) occur in advance of the parties undertaking full-scale negotiations and are designed to be replaced by a long-term agreement. Which of the following is a key characteristic of PreSS?
PreSS are formal and binding
Because negotiations are costly to prolong, it is in both parties' interests to determine whether a positive bargaining zone is possible. If the negotiators discover that no positive bargaining zone exists, what is the recommended action they should take?
Stop negotiations and pursue other alternatives
Skilled negotiators know how to recognize six key types of information during negotiations and know what information is safe to reveal to reach win-win outcomes. Which of the following information types is the most dominantly used distributive tactic for claiming value in a negotiation but their use often does NOT increase the likelihood of a win-win agreement?
Substantiation
Regarding effective strategies for a successful negotiation outcome, why should a negotiator be wary of the even-split ploy?
The pattern of concessions is not always fair and the pattern of offers is not always equal
Resource assessment involves the identification of the bargaining issues and alternatives. What is meant by the "issue mix" of a negotiation?
The union of both parties' issues
When negotiators' reservation points overlap, mutual settlement can be profitable for both parties. However, if a negotiator desires to maximize their outcomes in a positive bargaining zone, which of the following best describes the challenges a negotiator has when approaching the negotiation?
To reach a settlement that is most favorable to oneself and does not give up too much of the bargaining zone
Once a negotiator puts an offer on the table, it is time for the counterparty to respond to the offer, however some negotiators make premature concessions. What is meant by a premature concession in negotiation?
When a negotiator makes multiple concessions before the other party responds
Many negotiators do not think about their BATNA before negotiating. No other thing can help a negotiator get a bigger slice of the negotiation pie than:
a great BATNA
The strategy of making multiple equivalent simultaneous offers (MESO's) can be effective even with the most uncooperative of negotiators. The MESO strategy is best described as:
a negotiator presenting the other party with at least two or more proposals of equal value
In a positive bargaining zone, negotiators' reservation points overlap. If the parties fail to reach an agreement when a positive bargaining zone exists, the outcome is ________ because ________.
a suboptimal impasse; the negotiators left money on the table
In every negotiation, there are a number of resources on the table and those resources are yours to keep provided you and the other party can agree on how to divide them. Truly integrative negotiations are ones in which the outcome is pareto-optimal which means:
all opportunities are leveraged so that no resources are left on the table
A key benefit of post-settlement settlements in negotiation is that they:
allow both parties to reveal their preferences without fear of exploitation
Your aspiration point defines the upper limit on what you can get in a negotiation. Because you will usually never get more than your first offer, your first offer represents ________ in the negotiation.
an important anchor point
Concession aversion refers to the tendency for some negotiators to be disinclined to make concessions. Negotiators show stronger concession aversion and ultimately claim more value when negotiation proposals:
are framed to highlight their own resources
By taking the perspective of the other party, negotiators attempt to see the world through the counterparty's eyes. Negotiators who are high in perspective-taking ability or consider the perspective of the counterparty often:
avoid impasses and engage in successful logrolling
The ________ is the amount of overlap between parties' reservation points and a measure of the value that a negotiated agreement offers to both parties over the value of not reaching a settlement.
bargaining surplus
Even though many negotiators provide information during a negotiation, the counterparty may not necessarily understand the information. In negotiation, the illusion of transparency is best described as occurring when negotiators:
believe they are revealing more than they actually are
When making a precise offer, it is important to consider how precision affects the proposer as well as the recipient of the offer. Greater offer precision works when the recipient is an amateur, but can backfire when the recipient is an expert, unless the negotiator:
can provide the expert a legitimate rationale for their offer precision
Some negotiators make extreme offers. The result of this strategy often means the counterparty may be offended and walk away from the table. This is known as the:
chilling effect
Most negotiators make the mistake of negotiating each issue independently of others. Single-issue offers lure negotiators into ________ and are usually not the best approach for win-win negotiation.
compromise agreements
Once the first offers are on the table, the negotiation is not done. Ideally, negotiators need to not become stubborn and eterm-9ntrenched about what they want and instead begin a series of reductive counteroffers known as:
concessions
Concession reciprocity refers to the tendency of negotiators to reciprocate concessions. Unilateral concessions refer to ________; bilateral concessions refer to ________.
concessions made by one party ; concessions made by both sides of the negotiation
Negotiators not only often have differences in interests and preferences, they can also view the world differently. The enlightened negotiator knows that ________ have more potential to create greater value than ________.
differences; commonalities
Win-win negotiation does NOT pertain to how resources are ________ but rather, to how resources are ________ by negotiators.
divided; created
With regard to claiming value, negotiators should be willing to settle for outcomes that ________ their reservation point and ________ offers that are less than their reservation point.
exceed; reject
In negotiation sometimes parties' interests are compatible on some of the negotiations issues. However, even when some interests are compatible, ________ occurs when people believe that their interests are incompatible with the other party's interests.
false conflict
A ________ is a single salient coordinating concept, shared by negotiators. Conversely, a ________ is a departure that takes place during the course of negotiation, when the trajectory seems to change. In the case of contentious negotiations that may be headed for impasse, a ________ might allow negotiators to reach mutual agreement by changing the course of negotiation.
focal point; turning point; turning point
Negotiators who express interest in the counterparty's viewpoints are more willing to engage in future interactions with the counterparty and are more receptive. Negotiators who are ________ are more likely to reach higher joint outcomes because they ask more questions that benefit both parties.
high in epistemic motivation
When parties are considering potential trade-offs among valuations, forecasts, risks, time preferences, and capabilities, parties should focus on issues that are of ________ to one party and of ________ for the other party to provide.
higher value; low cost
Negotiators who desire to increase their share of the bargaining zone are best advised to:
improve their BATNA
When a negotiator draws conclusions about the counterparty's true interests from their responses to packages of different offers, the negotiator can discover opportunities for joint gains through the process of:
inductive reasoning
Negotiated outcomes will fall somewhere in the bargaining zone. The best possible economic outcome for the negotiator is one that ________, thereby inducing the other party to ________, but allows the focal negotiator to ________.
just meets the counterparty's reservation point; agree; reap as much gain as possible
Some negotiations involve the exchange of pleasantries and other conversation before offers are tendered, in other negotiations, people immediately initiate a volley of offers. In most situations, ________ first offers are more likely to lead to agreements that meet parties' interests as compared to ________ first offers, even when controlling for the overall duration of the negotiation.
late; early
Negotiators have different strengths of preference for each issue on the bargaining table. In negotiation, the strategy of making concessions on low-priority issues in exchange for gains on high-priority issues is known as:
logrolling
Be careful when the counterparty discloses their BATNA at the outset of the negotiation. When the counterparty discloses his or her BATNA at the outset of the negotiation, negotiators often respond with all of the following actions, EXCEPT:
make more extreme demands for money and time
The Boulwarism strategy, named after a former CEO, often engenders hostility from the counterparty because it prescribes that negotiators should:
make their first offer their final offer
Rarely are negotiations purely competitive situations. Rather, most negotiations are ________ in nature, meaning that parties' interests are imperfectly correlated with one another.
mixed-motive
In some negotiations, the parties agree on the probability of future events but feel differently about taking risks. As compared to negotiators who focus on minimizing costs (loss-frame), negotiators who focus on maximizing gains are:
more likely to logroll or trade off issues in a win-win fashion
Sometimes a negotiator will possess information about the counterparty that are non-diagnostic to the negotiation. It is important to ask the right questions in a negotiation and this extra knowledge can affect the negotiation in all of the following ways EXCEPT:
more likely to rashly leave the negotiation
The bargaining zone, or zone of possible agreements (ZOPA), is the range:
of overlap between negotiators' reservation points
When a negotiator has reliable, thorough information about the negotiation object or service, they are in a good position to:
open with an assertive aspiration point to anchor their offer early in the negotiation
A steak house and their steak purveyor are in negotiations about product delivery. The parties reach an agreement, but then agree to explore other options with the goal of finding another option that both parties prefer more than the current agreement. This situation is an example of a:
post-settlement settlement
Most negotiations begin as single-issue negotiations but it is usually possible to identify more than one issue for negotiations. The probability that negotiators will have identical preferences across all issues is small and it is differences in ________ that may be profitably traded off to create joint gain.
preferences, beliefs and capacities
There are many other ways to demonstrate trust and build a relationship, short of revealing your BATNA. Revealing information about a BATNA or a reservation point:
reduces a negotiator's power in a negotiation
All of the following strategies can help negotiators expand the pie of resources and create win-win agreements EXCEPT:
separating opportunities from costs
Agent Scott Boras, who represents many of the highest-paid baseball players in MLB, brings an encyclopedic-sized binder with the accomplishment details of everyone of his clients, and when negotiating for a client's contract with a team, he includes obscure charts of the players' potential impact on that team's bottom line. By bringing this binder to a negotiation, Mr. Boras is engaging in offer:
substantiation
When formulating counteroffers and concessions, negotiators need to consider four things:
the concession reciprocity, as well as the pattern, the magnitude, and the timing of concessions
It is not sufficient for a negotiator to have lots of experience negotiating to be excellent at creating win-win agreements. The biggest roadblock to the attainment of integrative agreements is:
the faulty assumptions they make about the counterparty and the negotiation situation
When both parties to a negotiation have the same interests, but still fail because of false conflict to capitalize on their compatible interests, this situation is best termed:
the lose-lose effect
Some negotiators reveal their reservation point to demonstrate good faith. If you reveal your reservation point during the course of negotiation:
the other party has little or no incentive to offer you any more
In the bargaining zone, the negotiator's surplus is the positive difference between:
the settlement outcome and the negotiator's reservation point
When a negotiator has their first offer immediately accepted by the counterparty, this signals that the negotiator did not set their aspirations high enough. This situation is known as:
the winner's curse
In some negotiations, the bargaining zone may be nonexistent or even negative. A negative bargaining zone indicates that:
there is no positive overlap between the parties' reservation points
If the counterparty presents the opening offer, you are now in the position of responding with a counteroffer. Counteroffers accomplish two things; first they signal your willingness to negotiate, and second:
they diminish the prominence of the counterparty's initial offer as an anchor point
Certain information can be beneficial in the search for integrative negotiation agreements. The types of helpful information that negotiators should share are their ________ and ________.
underlying interests; priorities
Integrative negotiations are also known as:
win-win negotiations
