Zone Of Possible Agreement

AAA

DEFINITION of 'Zone Of Possible Agreement'

Not a physical place, the zone of possible agreement is considered an area where two or more negotiating parties may find common ground. It is this area where parties will often compromise and strike a deal.

INVESTOPEDIA EXPLAINS 'Zone Of Possible Agreement'

In order for negotiating parties to find a settlement or reach an agreement they must work towards a common goal and seek an area that incorporates at least some of each party's ideas. This area of compromise is considered the zone of possible agreement.

RELATED TERMS
  1. Acquisition

    A corporate action in which a company buys most, if not all, ...
  2. Merger

    The combining of two or more companies, generally by offering ...
  3. Tender

    To invite bids for a project, or to accept a formal offer such ...
  4. Transaction

    1. An agreement between a buyer and a seller to exchange goods, ...
  5. Sweetheart Deal

    A merger, a sale or an agreement in which one party in the deal ...
  6. Negotiated Sale

    A method of offering municipal bonds or similar financial instruments ...
Related Articles
  1. Mergers And Acquisitions: Understanding ...
    Fundamental Analysis

    Mergers And Acquisitions: Understanding ...

  2. The Basics Of Mergers And Acquisitions
    Options & Futures

    The Basics Of Mergers And Acquisitions

  3. ISDA Master Agreement
    Investing Basics

    ISDA Master Agreement

  4. 4 Contract Essentials You Need to Know
    Budgeting

    4 Contract Essentials You Need to Know

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center