Week 6 Homework Problems - [WEEK 6 HOMEWORK PROBLEMS JENNA...

This preview shows page 1 - 2 out of 2 pages.

[WEEK 6 HOMEWORK PROBLEMS – JENNA ARMITAGE] 1 15-4 Salary Negotiation The below figure represents the potential outcomes of your first salary negotiation after graduation. Assuming this is a sequential-move game with the employer moving first, indicate the most likely outcome. Does the ability to move first give the employer an advantage? If so, how? As the employee, is there anything you could do to realize a higher payoff? Assuming that this is a sequential-move game with the employer moving first, the most likely outcome will be the employee accepting the low salary offer. The employer moving first does give the employer an advantage because the employer gets to choose which offer to make. Knowing all possible outcomes, regardless of the low or high salary offer, if the employee walks from the offer, both employer and employee do not gain anything. However, with both offer, employer knows that if the employee accepts the offer, employer can gain the best from offering the low salary offer to the employee.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture