Final-offer arbitration about post-sale compensation

In daily life, there are frequently some disputes about post-sale compensation in commodity consumption. These disputes are usually very time-consuming, and often caused a lower efficiency. Consumer and dealer are often at an impasse. This paper introduces a solution by appointing an arbitrator. The arbitrator determines the facts and then selects an offer from the sealed final offers that two parties submitted, and the selected final-offer becomes binding on both sides. Assume that the arbitrator after determining facts has some ideal value in mind, and suppose that in terms of one linear scale, the arbitrator selects the offer that is closer to his ideal. We discuss three special cases of this situation and analyze some of the strategic aspects of final-offer arbitration.