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Fred and his employer both know that Fred can generate $200,000 of profit per year for his company. After negotiations, they agree that he will
Fred and his employer both know that Fred can generate $200,000 of profit per year for his company. After negotiations, they agree that he will earn $110,000 in annual compensation. Based on this information and the non-strategic view of bargaining, how much more is the value of Fred's outside option relative to that of his employer?
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