Person A wants to buy a car. He/she spots a high-quality used car on a dealer’s lot over the weekend. Although it is a great deal, he/she does not have quite
enough money to purchase. He decides to try a trade-in. The dealer will only give him $1,200 for his current vehicle. As mentioned, this a good deal, and
Person A knows the vehicle won’t sit on the lot for long. Person A decides to sell his/her vehicle on their own for around $2,000. The car is in good condition
with the exception of a few minor dents in the fender. The radio has also been cutting in and out, but still works for the most part.
Person A tells his/her co-worker (Person B) about his predicament. Person B actually is in the market for a used vehicle, as his/her daughter turns 16 next
week and needs a car fairly quickly. Person B offers to buy Person A’s vehicle for $1,700, accounting for the dents and stereo issues. The vehicle’s bluebook
price is $1,950, and its wholesale price is $1,200.
What power does Person A have?
What power does Person B have?
Describe the importance of time to both Person A and Person B.
What are some possible points of compromise?
Sample Solution
Person A has the power to set the price for the vehicle and negotiate a better price with Person B.
Person B has the power to purchase Person A’s vehicle, or walk away if he/she deems it too expensive.
Time is of great importance to both Person A and Person B. Person A needs to sell their car quickly in order to take advantage of the dealer’s offer on another car, while Person B needs a vehicle relatively soon due to his/her daughter’s upcoming 16th birthday.
The two could compromise by agreeing on a middle ground between $1,700 and $1,950 – perhaps somewhere in the range of $1,800-$1,850 – taking into account that there are minor issues with the car.
Sample Solution
Person A has the power to set the price for the vehicle and negotiate a better price with Person B.
Person B has the power to purchase Person A’s vehicle, or walk away if he/she deems it too expensive.
Time is of great importance to both Person A and Person B. Person A needs to sell their car quickly in order to take advantage of the dealer’s offer on another car, while Person B needs a vehicle relatively soon due to his/her daughter’s upcoming 16th birthday.
The two could compromise by agreeing on a middle ground between $1,700 and $1,950 – perhaps somewhere in the range of $1,800-$1,850 – taking into account that there are minor issues with the car.