CPN Negotiation Fundamentals & Strategies 2 — Questions and Answers
Question 1: In a distributive negotiation, what does 'anchoring' refer to?
- Refusing to make concessions
- Setting the first offer to influence the negotiation range (Correct answer)
- Walking away from the table to gain leverage
- Agreeing on a neutral third-party mediator
Correct answer: Setting the first offer to influence the negotiation range
Anchoring is the cognitive bias where the first number introduced in a negotiation heavily influences subsequent offers and counteroffers.
Question 2: What is the primary distinction between interests and positions in negotiation?
- Positions are flexible while interests are fixed
- Interests are the underlying needs; positions are the stated demands (Correct answer)
- Positions are private while interests are public
- Interests apply only to multi-party negotiations
Correct answer: Interests are the underlying needs; positions are the stated demands
Positions are what negotiators say they want, while interests are the underlying motivations, needs, or concerns driving those demands.
Question 3: Which negotiation strategy focuses on expanding the total value available before dividing it?
- Zero-sum bargaining
- Value claiming
- Value creation (Correct answer)
- Positional bargaining
Correct answer: Value creation
Value creation (integrative negotiation) involves identifying trade-offs and compatible interests to enlarge the total pie before splitting it.
Question 4: A negotiator's 'reservation price' is best defined as:
- The opening offer made to start negotiations
- The point at which a negotiator prefers no deal over the proposed deal (Correct answer)
- The target outcome the negotiator hopes to achieve
- The price agreed upon after final concessions
Correct answer: The point at which a negotiator prefers no deal over the proposed deal
The reservation price (or walk-away point) is the least favorable deal a negotiator will accept before breaking off negotiations entirely.
Question 5: When two parties' reservation prices overlap, what is this region called?
- The bargaining chip zone
- The BATNA corridor
- The Zone of Possible Agreement (ZOPA) (Correct answer)
- The anchor gap
Correct answer: The Zone of Possible Agreement (ZOPA)
The Zone of Possible Agreement (ZOPA) is the range between each party's reservation price where a mutually acceptable deal can be struck.
Question 6: Which of the following best characterizes a 'logrolling' tactic in negotiation?
- Delaying concessions to increase perceived value
- Trading concessions on issues of differing priority to each party (Correct answer)
- Publicly disclosing your BATNA to pressure the other side
- Presenting multiple equivalent offers simultaneously
Correct answer: Trading concessions on issues of differing priority to each party
Logrolling involves trading off concessions where each party gives up something of lower value to them in exchange for something of higher value, creating mutual gain.
Question 7: What effect does time pressure typically have on negotiation outcomes?
- It equally benefits both parties by encouraging efficiency
- The party under greater time pressure tends to make larger concessions (Correct answer)
- It eliminates anchoring bias entirely
- It forces negotiators to reveal their reservation prices
Correct answer: The party under greater time pressure tends to make larger concessions
The party with more time pressure is typically at a disadvantage because they are more likely to make concessions to close the deal quickly.
CPN Negotiation Fundamentals & Strategies 2
In a distributive negotiation, what does 'anchoring' refer to?