4. Assume that A and B are two subsidiaries of company AB and that they are based in different countries. A is subject to a tax rate of 30% and B is subject to a tax rate of 10%. Also assume that A and B each make a profit of $20 when A sells a widget to B at a transfer price of $70.

1. Calculate the taxes paid by A at a transfer price of $70.
2. Calculate the taxes paid by B at a transfer price of $70.
3. Calculate the total taxes paid by AB at a transfer price of $70.
4. Calculate the effective tax rate of AB at a transfer price of $70.