Sales Negotiation 4

Question 1

What psychological principle explains why people are more motivated to avoid losses than to acquire equivalent gains?

Accepted Answer

Loss aversion

Answer

Loss aversion (Kahneman & Tversky) shows losses feel roughly twice as painful as equivalent gains feel good.

Question 2

A prospect demands a 20% discount but gives no justification. What is the most effective counter?

Accepted Answer

Ask 'Help me understand what's driving that number' before responding

Answer

Asking for justification reveals whether the discount demand is based on a real constraint or is simply an opening position.

Question 3

Which of the following is an example of using 'social proof' as a negotiation tool?

Accepted Answer

Mentioning that 50 similar companies use your product at full price

Answer

Social proof reduces perceived risk and justifies pricing by demonstrating that peers have already validated the value.

Question 4

In the 'good cop/bad cop' tactic, what is the best counter-strategy?

Accepted Answer

Name the tactic and redirect to objective criteria

Answer

Naming the tactic ('It seems like you two are playing different roles here') neutralizes it without damaging the relationship.

Question 5

What is 'expanding the pie' in a negotiation context?

Accepted Answer

Creating additional value so both parties gain more than they expected

Answer

Expanding the pie involves identifying new tradeable issues that let both parties leave the table better off.

Sales Practice Test