BUS 485 Study Guide - Final Guide: Best Alternative To A Negotiated Agreement, Zopa, Final Offer

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 485
• Professor: mitra kiamanesh

Document Summary

Negotiations dance: the process of making an opening offer and then reaching a mutually agreeable settlement. Bargaining zone (zone of possible agreements zopa): the range between the negotiators" reservation points. The final settlement of a negotiation will fall somewhere above the seller"s reservation point and below the buyer"s reservation point. Positive: the reservation points overlap; the most the buyer is willing to pay is greater than the least the seller will accept. This means that mutual agreement is better than one"s batna. Negative: when negotiators spend hours trying to reach an agreement; no positive overlap between the parties" reservation points. Bargaining surplus: the amount of overlap between parties" reservation points; the size of the bargaining zone, or otherwise known as the size of the pie that will be sliced. A measure of the value that a negotiated agreement offers to both parties over the value of not reaching settlement.