Collaboration, Conflict & Negotiation MGMT-GB.2159.B30 (MSOMS)

Midterm Exam

SUMMER 2025

This take-home exam is designed to take about 75 minutes to complete. You must take the exam.

By that time you must submit it via the Assignments tab on Brightspace.

Use this format for the document name: CCNSU25[Firstname]Exam.docx.

So for example:

•   CCNSU25MohammadExam.docx

•   CCNSU25WancheeExam.docx

•   CCNSU25BillExam.docx

If you submit the exam after the deadline, we will deduct a point for each minute it is late.

The questions are worth a total of 100 points.

Please type your answers in 12 point type on a separate Word document with the pages numbered. Do not use pdf format. (It makes it hard to give feedback.)

You do not need to send me back this question sheet. Begin the Word  document in exam form like so:

To: Prof. Seth Freeman via Brightspace

From: [your name]

email: [your email address]

Date:

Re: Collaboration, Conflict & Negotiation Final Exam Answers

Your do not need to copy or restate the question on your answer document.  You may answer the questions in any order you like; just make sure it's clear which question you are answering.  If you have a question about a part of the exam, please note the question in your answer and state your assumptions.  Then answer the question with that assumption in mind.

By taking this exam, you agree to follow the spirit and letter of the NYU Code of Conduct.  While you may refer to any notes or materials you'd like, you may not discuss the exam with anyone during the exam period or trade information about it. You may not include any other work besides your own.

1. Distributive Bargaining. (25 points.) Excellon   Truck Manufacturing Corp.  has asked your established, well-respected firm, Humbert Engines,    Inc., about supplying several hundred engines for its trucks. You are under pressure to get a high price to maintain profit margins in a competitive industry. While there is some chance you would be able to get some repeat business from Excellon, it is not clear when or how much. Excellon's executives tend to focus closely on price and don't want to hear about other options. Your firm can barely justify a  price of $2,000 per engine; a lower price would mean it's more profitable to make tractor engines. According to well-respected industry trade journals, your competitors rarely get more than  $2,400 for similar engines. Well-connected industry colleagues confirm this and add that sometimes your competitors get as little as    $1,600.  Excellon, a  reliable,  profitable firm,  probably wants a   low price-  the buyer has strongly hinted she wants $1,400.  Please answer each of the following questions.

(a) What is the top target price you will seek? Just state the number.  You do not need to explain the answer.

(b) What is your walkaway price? Just state the number.  You do not need to explain the answer.

(c) Assume you must make the first offer. What offer will you make, and why? Please state the offer and then briefly explain, as you would to a confidente, why you chose that offer.

(d) Now assume your boss is not pressing you to get a high price to maintain profit margins. Name one of the several alternative goals we said in a key course video that a negotiator might elect instead of seeking an ambitious outcome, give a plausible $ price you might seek if you elected to go with that goal here, and then, in a sentence, explain what the term means and why a negotiator might consider using it.  If you name more than one, we will grade your first answer.

2. Basic Measures of Success. (30 points) Your boss tells you she wants you to fly to San Francisco, stay three nights, make a Monday morning meeting, stay in a presentable hotel of three stars or more, stay no more than 30 minutes away from the Transamerica Tower (so you can hold a secure video conference with her at the hotel’s video facility from 8:00-8:25 and still make a 9:00 meeting at the Tower,) and keep costs as low as reasonably possible. Imagine you get three nights (Sunday through Tuesday  night)  at  the  Four  Seasons,  a  four-star  hotel  that  is  normally  30-40  minutes  from Transamerica Tower.  The hotel originally offers you a king-sized bed and no special amenities for $250/night; after negotiations they offer you a double bed for $180 with an extra-large TV, museum passes, and a living room area. As a courtesy to guests this season because road construction near the hotel may cause occasional traffic delays, the hotel also gives you a 50% off coupon for dinner at the hotel's excellent restaurant.   You  know  that  other four-stars hotels typically offer  secure video conference facilities 24 hours a day for a nominal charge. The Four  Seasons has  an excellent reputation with a four-star rating from several respected industry guides, and you had very positive dealings by phone with the reservation staff and the concierge.

(a) Please state the basic measure(s) of success a trained negotiator should use, stating each in a sentence. I am not asking for a single word for a given measure of success (e.g. “Is it good existentially?”) but a sentence that makes it clear what the test consists of (eg “Existential– is the offer philosophically  capable  of addressing man’s  search for meaning and man’s need for agency?”).

(b) Would you agree to such a deal? Yes or no?

(c (i)) Then please tell me if you succeeded by the measure(s) you’ve stated, or, if you need more information, what specific fact(s) you would need to know. (E.g. “The offer does not succeed.”)

(c (ii)) Then give one or two sentence answers for each portion of each measure of success. (E.g., “The offer partly fails and partly succeeds at meeting the existential test. It fails to address man’s search for meaning because…The offer does meet man’s need for agency because…”) Keep in mind that the question is testing your understanding of the measure(s) of success in negotiation and not your knowledge of a hotel market.

3. Packaging (20 points). Schoal Marketing, a printing, warehousing, and distributing firm, has offered to print catalogs for you at $0.20/cents per copy for 500,000 copies, payable in 15 days, and to package and ship parcels at $2.00/parcel payable in 15 days, if your firm, Bountiful Table, will post $2,000 upfront. Your research tells you that there are several comparable firms that are quite negotiable and that will print catalogs for prices ranging from $0.15 to $0.25 per copy for 500,000 copies, payable from 15 to 90 days, and package and ship parcels for prices ranging from $1.75- $2.25/parcel payable in 15 to 90 days, with deposits of $0 to $2,000.

Payment terms are most important to you.

Prices, while important, are a bit less so.

Other issues are substantially less important to you.

(a) Please first craft a statement up to three sentences long introducing a package you wish to present to your counterpart- a statement that helps you signal and set a tone  that will help you move the negotiation toward a 'good for them, very good for us' outcome.

(b) Then please craft a package counteroffer that’s competitively and collaboratively wise.

In crafting the statement and the offer, please intentionally use the Win Warmly Recipe Card we developed in class. Present it in term sheet format like so:

[Topic W]:      adsf34etwggg

[Topic X]:       xcvxcvbxcvb

[Topic Y]:       asdfasdfasdf

[Topic Z]:       fghjfghjfghj

4. Getting to Wise Yes/Wise No (25 points). You and your spouse own and operate a small restaurant that sells hot dogs from a large franchise corporation called Fine Franks™ . You’ve worked hard for several years, which has made you one of the most successful fast food restaurants in the region. But you’re tired, and the doctor says your spouse needs full, immediate rest and a year-long vacation or your spouse will be in serious medical trouble.You must begin the trip within two months, she says. So, you have decided to sell, buy a mobile home, and travel the country. A survey in a major trade publication tells you that less successful restaurants in the region have recently sold for between $150,000 and $200,000. You’ve decided you deserve and need a minimum of $225,000. You’ll need $100,000 for the mobile home, $50,000 for travel expenses, and $75,000 for a nest egg to live on the following year while you look for work. You have one other offer: SizzlinSteaks™ has offered you $175,000. So you’re quite interested to see what Fine Franks™ will offer you. You are about to meet with a Fine Franks™ executive, who will give you a specific proposal. You don’t know much about Fine Franks™, but you are very well-connected and respected by fellow fast food restaurant owners, who tell you Fine Franks™ is in the middle of an acquisition program and is looking to buy several good fast food restaurants in the region. Here is the offer from Fine Franks™ representative:

Well it’s a pleasure to meet you. We know your reputation, and your success running the restaurant. We’ve looked at our budget carefully and we would like to make an offer to purchase your restaurant.

We can offer you a package worth a total of $240,000. The package would include a $170,000 note payable over 18 months, plus a nearly new Ford delivery van deliverable when we close worth $70,000. (Federal law says the van cannot be sold or traded again for seven years, but it’s a classic in very good condition.)

In return, we’d purchase the restaurant and ask for your commitment to work with us on site to keep it running during a four-month transition period. Also, as a show of good faith, we’d ask that you back the restaurant’s performance for the first year after the sale, so that if sales fall below your previous results we’d receive back a $25,000 repayment.

We can close seven weeks after we shake hands. If you’d first like to make a change in the deal terms, we’d just have to run the change by the board which will take two to four weeks. Alas, the board can’t increase the note’s value or the station’s overall price, but it may be open to one or two other change(s).

So to sum up, our basic offer is for a total of $240,000 in exchange for the restaurant plus a bit of support in the transition.

Which of the following four choices will you choose? Please pick just one answer.

a) Accept the offer as is? (if so, put “I will accept the offer as is.” Do not elaborate and do not write about other choices.)

b) Reject the offer? (if so, put “I will reject the offer.” Do not elaborate and do not write about other choices.)

c) Accept the offer with one change other than price? (if so, put, “I accept the offer with one change other than price:” then briefly specify without explanation and do not write about other choices.)

d) Accept the offer with two changes other than price?  (if so, put, “I accept the offer with two  change other than price:” then briefly specify without explanation and do not write about other choices.)