During a negotiation, the supplier requests for payment term shortened to 45 days from 60 days. Seeing that this proposal lies within the concession plan, the procurement manager asks for 5% discount in return. Is that right thing to do?

• A. Yes, the procurement manager should keep that 5% for himself because that amount is a fair compensation for his effort
• B. No, procurement should insist the payment term remains 60 days
• C. Yes, since procurement manager has his own cost savings target to achieve and he should make use of supplier's financial status
• D. No, it is unethical to exploit the weakness of the other party

The sourcing manager has decided to adopt an adversarial style of negotiation to take advantage of the buyer' s greater bargaining power over the suppliers. In what other circumstances should an adversarial relationship be used?

• A. When the issues concerned are non-negotiable, for example, health and safety commitments
• B. In all forms of negotiation as each party is always trying to gain advantage over the other
• C. In a monopoly market as the supplier will respond by conceding quantity discounts
• D. When the supplier is likely to respond with further concessions to maintain a long-term relationship

Which of the following is most likely a consequence of falling interest rate?

• A. Increase savings
• B. Decrease investment
• C. Increase aggregate demand
• D. Decrease consumption

Fast & Easy Limited, a global fast food retailer, is in a negotiation with its major meat supplier. The supplier is asking for a 2% price increase, which Fast & Easy is strongly resisting. The supplier justifies this increase by stating that currency fluctuations, an unstable economic climate, and rising transport costs have necessitated this increase. Which influencing tactic is the supplier using?

• A. Inspirational appeal
• B. Rational persuasion
• C. Personal appeal
• D. Coalition