Let’s say that a seller has a house she wants to sell for $150,000. She asks...

Let’s say that a seller has a house she wants to sell for $150,000. She asks the real estate agent to list it for sale at $160,000, but tells the agent not to entertain any bid below $140,000. An interested buyer, who can afford a mortgage at current rates if the total price is below $145,000 (his limit), looks at the house and likes it enough to put in an offer of $138,000. This situation could be characterized as:

Group of answer choices

e) An opportunity for the agent to renegotiate her fee with the seller.

c) A bad BATNA for the buyer

a) A positive ZOPA

b) A negative ZOPA

d) A bad BATNA for the seller

Expert Solution

Answer – A bad BATNA for the seller

BATNA refers to Best Alternative To Negotiated Alternative. Seller has specifically asked to not entertain any bid below $1,40,000. So, buyers bid of $1,38,000 is bad alternative for the seller as the seller wants to sell it for at least $1,50,000.

keosha answered 2 years ago

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