CBN CBN Value Creation & Claiming 4 — Questions and Answers
Question 1: In negotiation theory, 'expanding the pie' refers to which primary concept?
- Increasing the total value available for both parties through creative problem-solving (Correct answer)
- Demanding a larger share of existing resources
- Adding more agenda items to prolong discussions
- Hiring additional negotiators to cover more ground
Correct answer: Increasing the total value available for both parties through creative problem-solving
Expanding the pie means creating additional value so both sides can gain more than the fixed-sum assumption allows.
Question 2: A negotiator discovers that her counterpart values delivery speed far more than price discounts. The best value-creation move is to:
- Offer faster delivery in exchange for a higher price (Correct answer)
- Insist on the original price without adjustment
- Reduce price to match the counterpart's expectations
- Delay delivery to test the counterpart's patience
Correct answer: Offer faster delivery in exchange for a higher price
Trading on differing priorities—speed for price—is a classic integrative move that creates mutual gain.
Question 3: Which of the following best describes a 'contingent contract' as a value-creation tool?
- A deal whose terms vary based on a future event or performance outcome (Correct answer)
- A contract signed only after full payment is received
- An agreement that automatically renews each year
- A clause that voids the deal if either party defaults
Correct answer: A deal whose terms vary based on a future event or performance outcome
Contingent contracts resolve differing forecasts by tying deal terms to how uncertain future events actually unfold.
Question 4: When negotiators make 'package' offers rather than single-issue proposals, the primary benefit is:
- Revealing relative priorities and enabling trade-offs across issues (Correct answer)
- Confusing the counterpart with complex terms
- Locking in a position before the counterpart can respond
- Reducing the number of negotiation sessions needed
Correct answer: Revealing relative priorities and enabling trade-offs across issues
Package offers expose how each party values different issues, creating room for integrative trade-offs.
Question 5: Post-settlement settlements (PSS) are used to:
- Improve upon an already-reached agreement by searching for mutually superior options (Correct answer)
- Renegotiate deals that fell through at the last minute
- Enforce penalties when one party breaches the contract
- Document final terms before signing the main agreement
Correct answer: Improve upon an already-reached agreement by searching for mutually superior options
PSS involves both parties agreeing to explore whether a better deal exists after reaching an initial agreement, with the original as a fallback.
Question 6: Which claiming strategy is most effective when a negotiator has strong, verifiable alternatives (high BATNA)?
- Anchor aggressively and hold firm, knowing the BATNA provides leverage (Correct answer)
- Make early concessions to build goodwill and close quickly
- Avoid revealing the BATNA to prevent the counterpart from matching it
- Focus exclusively on value creation before any claiming discussion
Correct answer: Anchor aggressively and hold firm, knowing the BATNA provides leverage
A strong BATNA gives real leverage; using it to anchor high and concede slowly maximizes the claimed share.
Question 7: In a distributive negotiation, 'the zone of possible agreement' (ZOPA) exists when:
- The seller's reservation price is below the buyer's reservation price (Correct answer)
- Both parties have identical BATNAs
- The opening anchors of both sides are equal
- Neither party has disclosed their true interests
Correct answer: The seller's reservation price is below the buyer's reservation price
ZOPA exists when the maximum a buyer will pay exceeds the minimum a seller will accept, creating an overlap where deals are possible.
CBN CBN Value Creation & Claiming 4
In negotiation theory, 'expanding the pie' refers to which primary concept?