What is the term for a settlement of differences between opposing sides in which each makes concessions?

• A. Compromise
• B. Agreement
• C. Mediation
• D. Resolution

Answer: (A)

The idea being tested is identifying a word that describes settling a dispute when both sides give up some demands to reach a middle ground. That best fits compromise, because it specifically means each party makes concessions to find a middle ground that both can accept. In negotiations, concessions on issues like price, terms, or conditions often lead to a compromise that resolves the differences.

Mediation refers to the process of using a neutral third party to facilitate discussion; the settlement that results may be a compromise, but mediation itself is about the helping process rather than the final agreement. An agreement is a mutual understanding or contract that may or may not involve concessions. A resolution is a formal decision or conclusion to solve the problem, and does not inherently imply concessions by both sides.

So, the term for a settlement of differences in which each side makes concessions is compromise.