After starring in your economics and finance courses during your MBA you were offered a starting position with McKinsey and Company for $140,000/year. After your first year you have been approached by Coles Group Limited to take a line management role for $180,000/year. The Coles Group offer (for reasons we won't go into) is not negotiable: either you have to accept, or to reject. Over the past year you have earned $250,000 in revenues through billable work for McKinsey. McKinsey can replace you with a fresh MBA graduate for $140,000 and expect the same first-year earning capability from the new recruit. Your second year earnings for the company are projected to rise to $350,000. (McKinsey doesn't think beyond this year, because a lot of recruits leave after one or two years.) (Ignore discounting.) You enter into contract renegotiations for your second year. If both you and McKinsey have equal bargaining abilities, what would your second year's salary be? Please enter a number with no comma and no dollar sign. What would be expected to happen if the Coles Group offer was $245,000/year? Group of answer choices Work at Coles Group for $245,000/year Work at McKinsey for $242,500/year Work at McKinsey for $245,000/year Work at McKinsey for $250,000/year Work at McKinsey for $240,000/year
McKinsey / Coles
The following information is required for Questions 12 and 13:
After starring in your economics and finance courses during your MBA you were offered a starting position with McKinsey and Company for $140,000/year. After your first year you have been approached by Coles Group Limited to take a line management role for $180,000/year. The Coles Group offer (for reasons we won't go into) is not negotiable: either you have to accept, or to reject. Over the past year you have earned $250,000 in revenues through billable work for McKinsey. McKinsey can replace you with a fresh MBA graduate for $140,000 and expect the same first-year earning capability from the new recruit. Your second year earnings for the company are projected to rise to $350,000.
(McKinsey doesn't think beyond this year, because a lot of recruits leave after one or two years.)
(Ignore discounting.)
You enter into contract renegotiations for your second year. If both you and McKinsey have equal bargaining abilities, what would your second year's salary be?
Please enter a number with no comma and no dollar sign.
What would be expected to happen if the Coles Group offer was $245,000/year?
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