Answer:
Distributive bargaining
Explanation:
Distributive bargaining can be defined as a type of bargaining system/strategy in which one party gains only if the other party loses.
Distributive bargaining is mostly used when there is a negotiation that involves fixed resources e.g; money, assets, etc.
Distributive bargaining as a negotiation strategy does not aim to provide a win-win situation for all parties involved but that one party loses while the other gains considerably.
An example of distributive bargaining is a supermarket having a fixed price for an item. in that situation, you can't bargain and as such you either buy the item or leave the store.
That results in a win for the supermarket and a loss for you the buyer should yo choose to buy the item.
Cheers
Answer:
The answer is $148,000
Explanation:
Goodwill comes into effect or arises when a company acquires another company. Goodwill is an intangible asset. It is difference between the purchase price of a company and the net asset(total assets minus total liability)
Purchase price is $425,000
Fair value of the asset is $365,000
Total liability is $88,000.
Net asset = $365,000 - $88,000
=$277,000
Therefore, goodwill is $425,000 - $277,000
= $148,000
Answer:
The profit expected from the two IPOs is $2887.5
Explanation:
For the overpriced IPO,1100 shares would be received and since the share was overpriced by $6.25, an instant loss of $6,875
($6.25*1100) is recorded.
For the under-priced IPO ,550 shares (1100 shares divided by 2) would be received and the immediate gain recorded is $9,762.5(550 *$17.75)
Overall the two portfolios, when taken together,give an immediate gain of $2,887.50(gain of $9,762.50 less loss of $6,875
)
This is power of portfolio diversification, that managing potential investment losses by spreading one's investment.
