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Huntley Division has the capacity to make 3,000 units of an intermediate good that is sold both internally and on the open market for a
Huntley Division has the capacity to make 3,000 units of an intermediate good that is sold both internally and on the open market for a price of $56 each. To make the product, Huntley incurs $10 of variable cost per unit and $24 of fixed costs per unit. What is the minimum price Huntley would accept for an internal transfer of the 1,000 units of the product if the division is operating at 50% capacity?
$34.00 each | ||
$10.00 each | ||
$56.00 each | ||
$50.00 each |
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