Which of the Following Denotes Minimum Transfer Price

question 40

Multiple Choice

Which of the following denotes minimum transfer price?

• A) Minimum transfer price = Incremental cost per unit incurred up to the point of transfer + Opportunity cost per unit to the selling subunit
• B) Minimum transfer price = Total cost per unit incurred up to the point of transfer + Sunk cost per unit to the selling subunit
• C) Minimum transfer price = Current cost per unit incurred up to the point of transfer + Historical cost per unit to the selling subunit
• D) Minimum transfer price = Variable cost per unit incurred up to the point of transfer + Fixed cost per unit to the selling subunit

---

Definitions:

Labor Market

The supply of available workers in relation to the demand for their services by employers.

Supply and Demand

Fundamental economic model that describes how the price and quantity of goods and services are determined in a market.

Wage Rate

The amount of money paid to an employee by an employer for work performed, usually expressed per hour or per unit of work.

Employment

The state of having a paid job or the total number of people employed within an economy.