22-22 Transfer pricing, general guideline, goal congruence. (CMA, adapted). Quest Motors, Inc., operates as a decentralized multidivision company. The Vivo division of Quest Motors purchases most of its airbags from the airbag division. The airbag divisions incremental cost for manufacturing the airbags is $90 per unit. The airbag division is currently working at 80% of capacity. The current market price of the airbags is $125 per unit.

Required

1. Using the general guideline presented in the chapter, what is the minimum price at which the airbag division would sell airbags to the Vivo division?