Bus640 Managerial Economics
Good Will in Price Bidding
Sometimes, a bidder on a work contract may bid lower than
what would maximize his/her profit from the contract and the reason for that is
to create goodwill (to increase expected future business from the buyer). How
would you value the goodwill that is obtained in this way?
Guided Response:
Think about an example that pertains to you. If there is expected goodwill
would you be prepared to bid lower to get a contract?
Explain your reasons. In
300 words or more, please, provide your response to the above discussion
question.
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