Lamothe Solutions is a management consulting firm. Its Business Division advises firms on the adoption and use of financial systems. Civic Division consults with state and local governments. Civic Division has a client that is interested in implementing a new costing system in its public works department. The division's head approached the head of Business Division about using one of its associates. Corporate Division charges clients $$840$ per hour for associate services, the same rate other consulting companies charge. The Civic Division head complained that it could hire its own associate at an estimated variable cost of $$440$ per hour, which is what Business pays its associates.

Required:

a$.$ What is the maximum price that Civic Division should pay?

b$.$ What is the maximum transfer price that Business Division should obtain for its services, assuming that it is operating at capacity?

$c-1.$ Is there any change in maximum price as indicated in part $($a$),$ if Business Division had idle capacity?

c$-2.$ Is there any change in maximum transfer price as indicated in part $($b$),$ if Business Division had idle capacity?

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What is the maximum price that Civic Division should pay?

Maximum price