Question Tag: Negotiation

Search 500 + past questions and counting.
Professional Bodies Filter
Program Filters
Subject Filters
More
Tags Filter
More
Check Box – Levels
Series Filter
More
Topics Filter
More
  • 3 Marks

: MA – May 2019 – L2 – Q1c – Transfer Pricing

Discuss the limitations of using negotiated transfer prices within a company.

When negotiated transfer prices are used in the company, the managers who are involved in the proposed transfer within the company meet to discuss the terms and conditions of the transfer. They may decide not to go through with the transfer, but if they do, they must agree to a transfer price.

Required:
Explain THREE (3) limitations of negotiated transfer prices. (3 marks)

Negotiated transfer prices suffer from the following limitations:

  • The transfer price which is the final outcome of negotiations may not be close to the transfer price that would be optimal for the organisation as a whole since it can be dependent on the negotiating skills and bargaining powers of individual managers.
  • They can lead to conflict between divisions which may necessitate the intervention of top management to mediate.
  • The measure of divisional profitability can be dependent on the negotiating skills of managers who may have unequal bargaining power.
  • They can be time-consuming for the managers involved, particularly where large numbers of transactions are involved.

(Any 3 points for 3 marks)

  • 15 Marks

BMIS – May 2016 – L1 – Q3b – Teams

Explain five benefits that may accrue to an individual for joining a formal group in an organization.

One of your colleagues is reluctant in joining a formal group that has been established in your company.
Explain FIVE benefits that may accrue to him/her if he/she joins the group.

i) Security: When he/she joins the group, the level of insecurity that is associated with being alone will be reduced because of the support from group members.

ii) Enhanced Status: If he/she becomes a member, the recognition and respect given to the group members will also be extended to him/her.

iii) Self-Esteem: As a member of a group, he/she will enjoy some sense of self-worth from the group.

iv) Power: There is power in numbers, and what cannot be achieved individually can be achieved by the group.

v) Knowledge Acquisition: When an individual joins a group, he/she will have the benefit of gaining knowledge from the more experienced members of the group.

vi) Enhanced Negotiation Position: The individual, by becoming a member of a group, will enhance his/her negotiation position because the impact of group decisions carries more weight than individual decisions.

vii) Friendship: It is a mechanism for satisfying the individual’s needs for friendship and social intercourse.

viii) Leadership and Identity: Groups serve as an opportunity to find the individual’s identity and provide leadership opportunities.

Take control of your business data with insight and in-depth understanding by taking this course. 

Services

Contact Info

  • +233203701923
    +233543919232
  • info@noohrabusiness.com

Get In Touch

Follow us on our social media and get daily updates.

Facebook-f Twitter Linkedin-in Envelope