Division A, which is operating at capacity, produces a component that currently sells in a competitive market for $23 per unit. At the current level of production, the fixed cost of producing this component is $4 per unit and the variable cost is $6 per unit. Division B would like to purchase this component from Division A. The price that Division A should charge Division B for this component is:

Multiple Choice

• $6 per unit.

• $10 per unit.

• $20 per unit.

• $23 per unit.

• $29 per unit.