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Laissez Faire has two divisions: the Cologne Division and the Bottle Division. The Bottle Division produces containers that can be used by the Cologne Division. The Bottle Division's variable manufacturing cost is $2, shipping cost is $0.10, and the external sales price is $3. No shipping costs are incurred on sales to the Cologne Division, and the Cologne Division can purchase similar containers in the external market for $2.60. Assume the Bottle Division has no excess capacity. Using the general rule, the transfer price from the Bottle Division to the Cologne Division would be:
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