Sembotix Company has several divisions including a Semiconductor Division that sells semiconductors to both internal and external customers. The companys X-ray Division uses semiconductors as a component in its final product and is evaluating whether to purchase them from the Semiconductor Division or from an external supplier. The market price for semiconductors is $100 per 100 semiconductors. Ayesha Johnson is the controller of the X-ray Division, and John Fodor is the controller of the Semiconductor Division. The following conversation took place between Ayesha and John:

Ayesha: I hear you are having problems selling semiconductors out of your division. Maybe I can help.

John: Youve got that right. Were producing and selling at about 90% of our capacity to outsiders. Last year, we were selling 100% of capacity. Would it be possible for your division to pick up some of our excess capacity? After all, we are part of the same company.

Ayesha: What kind of price could you give me?

John: Well, you know as well as I that we are under strict profit responsibility in our divisions, so I would expect to get market price, $100 for 100 semiconductors.

Ayesha: Im not so sure we can swing that. I was expecting a price break since our divisions are owned by the same company.

John: Hey, I am responsible for my own division's performance. If I give you a price break, our profits will fall from last years levels. I dont think I could explain that. Im sorry, but I must remain firmmarket price. After all, its only fairthats what you would have to pay from an external supplier.

Ayesha: Fair or not, I think well pass. Sorry we couldnt have helped.

Is Ayesha acting ethically? Is John acting ethically? Why or why not? Include discussion about market price approach, negotiated price approach, and cost price approach. What is a better way to negotiate a settlement?