DeMarcus Engineering Inc. manufactures microchips for general purpose use. These microchips are used in many appliances. Despite having many competitors, DeMarcus's microchips are considered one of the best and are in high demand, consequently, DeMarcus is able to sell all the microchips that it produces. The variable cost of production for a microchip is $5, allocated fixed cost is $5 and it is sold in the market for $20. DeMarcus also has another division that produces digital watches using microchips. The chip division produces special microchips for the digital watches that required an investment of $100000 to produce 1000 chips. The variable cost of production is $5. What would be an appropriate transfer price?

a.)The chip division should not produce the special microchips

b.)$20 is an appropriate transfer price for microchip

c.)$15 is an appropriate transfer price for microchip

d.)$10 is an appropriate transfer price for microchip