IIA CIA Exam Part Three: Business Knowledge for Internal Auditing IIA-CIA-Part3-3P Question # 16 Topic 2 Discussion

IIA CIA Exam Part Three: Business Knowledge for Internal Auditing IIA-CIA-Part3-3P Question # 16 Topic 2 Discussion

IIA-CIA-Part3-3P Exam Topic 2 Question 16 Discussion:
Question #: 16
Topic #: 2

A retail organization is considering acquiring a composite textile company. The retailer's due diligence team determined the value of the textile company to be $50 million. The financial experts forecasted net present value of future cash flows to be $60 million. Experts at the textile company determined their company's market value to be $55 million if purchased by another entity. However, the textile company could earn more than $70 million from the retail organization due to synergies. Therefore, the textile company is motivated to make the negotiation successful. Which of the following approaches is most likely to result in a successful negotiation?


A.

Develop a bargaining zone that lies between $50 million and $70 million and create sets of outcomes between $50 million and $70 million.


B.

Adopt an added-value negotiating strategy, develop a bargaining zone between $50 million and $70 million, and create sets of outcomes between $50 million and $70 million.


C.

Involve a mediator as a neutral party who can work with the textile company's management to determine a bargaining zone.


D.

Develop a bargaining zone that lies between $55 million and $60 million and create sets of outcomes between $55 million and $60 million.


Get Premium IIA-CIA-Part3-3P Questions

Contribute your Thoughts:


Chosen Answer:
This is a voting comment (?). It is better to Upvote an existing comment if you don't have anything to add.