Contractor a Is Negotiating to Build a Warehouse for Firm

Multiple Choice

Contractor A is negotiating to build a warehouse for Firm B to be completed in 75 days. Contractor A's estimated cost is $200,000. Pushing back the completion date by 15 days would allow it to reduce its cost by $30,000. The value to Firm B of the warehouse is $250,000 if completed in 75 days and $235,000 if completed in 90 days. A mutually beneficial, efficient deal:

A) means completion of the warehouse construction in 90 days at a price greater than $235,000.
B) means completion of the warehouse construction in 90 days at a price between $170,000 and $235,000.
C) is not possible as there is no zone of agreement.
D) means completion of the warehouse construction in 75 days at a price between $200,000 and $250,000.
E) is possible only if contractor A agrees to build the warehouse in 75 days.