Chapter 12 Formal Negotiating Answer Key
True / False Questions
1.
In win-lose negotiating, the negotiator attempts to secure an agreement that satisfies both
parties.
2.
The two radically different negotiation philosophies are win-lose and lose-win
negotiating.
3.
Negotiations differ from regular sales calls in that they involve less intensive planning and
a smaller number of people from the selling firm.
4.
Formal negotiations generally take place only for very large or important prospective
buyers.
5.
Successful salespeople always make great negotiators.
6.
Experienced negotiators find weekends best for negotiations.
7.
In negotiations, those who are the first to offer a concession often find the other party
giving a similar one in return, regardless of the power in the relationship.
8.
The best negotiation situation is when there is a distinct difference in power.
9.
When developing objectives, negotiators need to sort out all issues that could arise in the
meeting, prioritizing them by importance to the selling firm.
objectives?
10.
To allow for concessions, the target position should reflect higher expectations than the
opening position.
11.
The less information collected about what a buyer hopes to accomplish, the better
negotiators will be able to arrive at a win-win decision.
12.
A company’s sales representative who develops three alternative strategies to secure a
premium shelf position engages in adaptive planning.
13.
The less the participants, the more the time required to reach an agreement in a
negotiation.
14.
In general, in a negotiation meeting, the size of the seller’s team should be more than the
size of the buyer’s team.
15.
In a negotiation, individuals in the accommodating mode are the exact opposite of
competing people.
16.
While negotiating, a compromiser gives up less than a competing person but more than an
accommodating person.
17.
Ambush negotiation occurs when either party begins to negotiate with a win-lose strategy
when the other party does not expect it.
18.
Putting the key issues at the beginning in an agenda is advantageous.
19.
An agenda sets boundaries and helps keep parties in the negotiation on track.
20.
The technique of lowballing subdues the importance of getting signatures on contracts
and agreements as soon as possible.
21.
An effective defense against the good guy-bad guy routine is for the selling team to know
its position clearly and to not let the buyer’s negotiating tactic weaken it.
22.
A seller who negotiates a higher price after the price has been agreed upon engages in
lowballing.
23.
The selling team should always refuse nibbling requests from the buyer after a contract
has been signed.
24.
The best defense against budget limitations is to do your homework before going into a
negotiation session.
25.
After being accused of overcharging, Brian steps back and redirects the negotiation back
to the issues that were initially being discussed. Brian is engaging in negotiation jujitsu.
26.
Red herring is a win-win tactic that involves bringing up a major point first to distract the
other side from considering minor issues.
27.
All concessions in a negotiation are tentative until the final agreement is reached and
signed.
28.
To develop long-term partnerships, sellers should try to get every concession possible out
of their buyers.
29.
In win-win not yet negotiating, the buying team achieves its goals while the selling team
doesn’t.
30.
Generally, the goal of negotiation is to develop a short-term partnership with a buyer.
Multiple Choice Questions
31.
Which of the following refers to the bargaining process through which buyers and sellers
resolve areas of conflict and arrive at agreements?
32.
How do negotiations differ from regular sales calls?
33.
Sazaki Motors Company and its dealer Best Automobiles wanted to conduct a two-day
workshop for dealers at their own premises. After negotiations, it was decided that the
first day of the workshop would be arranged in the company’s auditorium, while the
second day of the workshop would be arranged at the dealer’s premises. Identify the
negotiation accepted in this scenario.
34.
Sarah is the lead negotiator for her company, which wants to sell its products to Cible
Department Store. Sarah explains to the managers at Cible how both her company and
Cible can improve their profits. Which of the following philosophies of negotiation is Sarah
exemplifying?
35.
Which of the following statements is true about negotiations?
36.
A manufacturer of lawn furniture wants to sell its furniture to a large chain of resorts. The
buyer and seller prepare for the negotiations. Which of the following items are likely to be
covered during the negotiations?
37.
While holding formal negotiations with Cible Department Store, Croustilles-Lay
representatives can negotiate:
38.
A manufacturer of cast iron frying pans wants to place its frying pans for sale in a major
retail store. Which of the following would be a negotiable item?
39.
Which of the following is a desirable trait for a negotiator?
40.
Why is it necessary for a good negotiator to have a willingness to take risks and an ability
to tolerate ambiguity in a business negotiation?
41.
Which of the following statements is true about planning for a negotiation session?
42.
Typically, the best place to hold a negotiation is at:
43.
Which of the following is the best time preferred by an experienced negotiator to begin
negotiations?
44.
The selling team from A. C. Doyle Food Service is planning a negotiation session with New
Bedford College. The team is hoping to acquire the contract to supply food for the college
in the next academic year for $1.4 million. At the beginning of the session, Doyle’s chief
negotiator plans to quote $1.65 million, but later decides that they would accept the
contract at any amount above $1.3 million. Considering the chief negotiator’s decision,
$1.4 million is Doyle’s:
45.
Jack is the house manager for Beta Theta Pi, a social fraternity. He is negotiating with
Jackson Hauling for trash pickup services at the fraternity house. He prefers a three-days–
per-week trash pickup schedule, but he is also willing to accept a two-days-per-week
arrangement. While negotiating with the company, he asks for daily trash pickup service.
The three-day trash pickup schedule is Jack’s:
46.
Mac is the house manager for Sigma Chi, a social fraternity. He is negotiating with
Hemphill Hauling for trash pickup services at the fraternity house. He prefers a three-
days-per-week trash pickup schedule, but he is also willing to accept a two-days-per-
week arrangement. While negotiating with the company, he asks for daily trash pickup
service. The two-day trash pickup schedule is Mac’s:
47.
Annette is representing Jackson Hauling, a new commercial trash collection service, in a
negotiation with the house manager of one of the local university’s social fraternities.
Annette first plans to suggest that her company can place a larger dumpster behind the
fraternity house than the current dumpster the other collection service company provides.
She then plans to propose that the group’s trash be picked up twice a month. She hopes
the frat will accept a once-a-week pickup given the larger size dumpster provided, and she
knows that because Jackson is a “small-time” startup company with only a limited number
of trucks, the most she can offer is twice weekly pickup. Twice monthly pickup is
Annette’s _____ position.
48.
The selling team from A. C. Doyle Food Service is planning a negotiation session with New
Bedford College. The team is hoping to acquire the contract to supply food to the college
for the next academic year for $1.4 million. At the beginning of the session, Doyle’s chief
negotiator plans to quote $1.65 million, but later decides that they would accept the
contract for any amount above $1.3 million. Considering the chief negotiator’s decision,
$1.65 million is Doyle’s:
49.
In a negotiation, to allow for concessions, the expectations expressed in the seller team’s
opening position should be:
50.
Ernie wanted Harry’s pickup truck for a weekend as he was planning to go on a solo trip to
California. He offered Harry a rent of $50 for two days. He also considered different
strategy revisions if Harry disagreed to this original plan. These strategy revisions included
an offer to clean Harry’s garage for 2 weeks and an offer to assist Harry in his garage for a
week. Identify the method used by Ernie in this scenario.
51.
Jane, the owner of Best Bakes, introduced chili-flavored cookies into the market. As an
introductory offer, she is willing to give 5 percent price discount for retailers who sell her
products. If this does not work, she is willing to give them a credit term of 7/10, n/45. If
this offer fails to make any impact on the retailers, she is ready to bear end–to-end
transportation costs. Identify the prenegotiation method used by Jane in this scenario.
52.
Which of the following statements is true about negotiation teams?
53.
Which of the following statements is FALSE about negotiation teams?
54.
Which of the following is NOT a conflict-handling mode?
55.
Roy is power oriented. He does not tolerate people on his negotiating team who do not go
along with his ideas. Roy’s resolves conflict in the _____ mode.
56.
Highly cooperative and unassertive people resolve conflict in the _____ mode.
57.
Negotiators in the accommodating mode are usually _____.
58.
Vince, a part-time caterer, negotiates a catering contract with Kevin for an annual
corporate Memorial Day picnic. Vince does not want to concede to Kevin’s demands for
unlimited seconds on fried chicken without any increase in what he is paid. However, he
accepts the contract without any counterbalancing concession from Kevin. Vince resolves
the conflict in the negotiation in the _____ mode.