Use the Following Information to Answer Questions

question 30

Multiple Choice

Use the following information to answer questions
Division A produces a product that it sells to the outside market.It has compiled the following:
-Division B of the same company is currently buying an identical product from an outside provider for $38 per unit.It wishes to purchase 5,000 units per year from Division A.Division A is currently selling 26,000 units of the product per year.If the internal transfer is made, Division A will not incur any selling costs.What would be the minimum transfer price per unit that Division A would be willing to accept?

• A)$10.00
• B)$14.60
• C)$15.40
• D)$40.00

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Definitions:

Separate Peace

An agreement to cease hostilities and settle peace terms independently, often by one party in a wider conflict without the consensus of its allies.

Confederate Nationalism

The patriotic sentiment and cultural identity that developed among the citizens of the Confederate States of America during the American Civil War.

Centralized Power

A form of governance in which all major decisions and authority are concentrated in a central government or authority figure.

Direct Democracy

A form of democracy in which people directly decide on policy initiatives without intermediary representatives or officials.