Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their return on investment (ROI). Assume the following information for the two divisions:

	Case
1	2	3	4
Alpha Division:
Capacity in units	90,000	410,000	160,000	310,000
Number of units now being sold to outside customers	90,000	410,000	110,000	310,000
Selling price per unit to outside customers	$ 50	$ 110	$ 125	$ 70
Variable costs per unit	$ 38	$ 85	$ 90	$ 46
Fixed costs per unit (based on capacity)	$ 6	$ 15	$ 20	$ 9
Beta Division:
Number of units needed annually	15,000	40,000	30,000	122,000
Purchase price now being paid to an outside supplier	$ 47	$ 109	$ 125*

*Before any purchase discount.

Required:

1. Refer to case 1 shown above. Alpha Division can avoid $2 per unit in commissions on any sales to Beta Division.
   1. What is Alpha Division's lowest acceptable transfer price?
   2. What is Beta Division's highest acceptable transfer price?
   3. What is the range of acceptable transfer prices (if any) between the two divisions? Will the managers agree to a transfer?