IPN Test1 Part-B (open book/notes; do not consult peers)
44 Points 1. You own a 2001 Ford Focus that has close to 100,000 miles. You think your
car is in an excellent condition. You research Kelly’s Blue Book and discover
the following: Trade-In Value
BLUE BOOK® TRADE-IN VALUE Close Kelley Blue Book Trade-In Value is the amount consumers can
expect to receive from a dealer for a trade-in vehicle,
assuming an accurate appraisal of the vehicle’s condition,
mileage and features. This value will likely be less than the
Private Party Value because the reselling dealer incurs the cost
of safety inspections, reconditioning and other costs of doing
business. More Photos Condition Value Excellent $2,100 Good $1,850 Fair $1,425 Suggested Retail Value
Kelley Blue Book Suggested Retail Value is representative of dealers’ asking prices
BLUE BOOK SUGGESTED RETAIL VALUE
for a used car, and the starting point for negotiation between a consumer and a
® Close dealer. This Suggested Retail Value assumes that the vehicle has been fully
reconditioned and has a clean title history, but has not been certified in accordance
with any Certified Pre-Owned (CPO) program the automaker may offer (for which it
may or may not qualify, according to factors such as vehicle age and mileage). This
value also takes into account the dealers’ profit, costs for advertising, sales
commissions and other costs of doing business. The final sale price will likely be less
depending on the vehicle’s actual condition, popularity, type of warranty offered and
local market conditions. More Photos Condition
Excellent Value
$4,430 Suggested Retail Value Assumes Excellent Condition More BLUE BOOK® PRIVATE PARTY VALUE Private Party Value
Kelley Blue Book Private Party Value is the amount a buyer can
expect to pay when buying a used car from a private party.
The Private Party Value assumes the vehicle is sold "As Is" and
carries no warranty (other than any remaining factory
warranty). The final sale price may vary depending on the
vehicle’s actual condition and local market conditions. This
value may also be used to derive Fair Market Value for
insurance and vehicle donation purposes. Close More Photos Condition Value Excellent $3,280 Good $2,980 Fair $2,430 Further, you also found that there were many similar cars for sale in or around the
Wayne area:
For Sale Near Wayne
2001 Ford Focus
Total Listings Near Wayne: 29 Below Blue
Book® Value*: 7 Assume the role of the seller and arrive at the following (you have to
provide clear reasons to back your numbers):
a. Were you to advertise this car for sale, say in Craigslist, how much will you
advertise it for? Why? (I don’t have a magic number that I want you to
come up with; I am interested in knowing how you think, as students of
Negotiation, when you come up with this price). (5 points) (160 words
max)
b. What is your BATNA? Why? (5 points) (160 words max)
c. What is your ZOPA? Why? (5 points) (160 words max)
d. What is your reservation price? Name 2 factors that may influence this? (5
points) (160 words max) e. What anchor will you want to open with? Why? (5 points) (160 words max)
2. In the BD Vaccutainer case discussions, what were the three elements of the bargaining mix? (6
points)
Mix1:
Mix2:
Mix3: 3. Choose one from the above and argue both for and against (e.g. no pvt. Label vs. agree to
private label); give your rationale (6 points) ((160 words max)
4. What do you think your negotiating style is? Explain what might have shaped it? (7 points)
((160 words max)
