The Lumber Division of Sheffield Corp. produces and sells lumber that can be sold to outside customers or within the company to the Construction Division. The following data have been gathered for the coming period:

Lumber Division:
Capacity	100000 board feet
Price per board foot	$2.50
Variable production cost per bd. ft.	$1.25
Variable selling cost per bd. ft.	$0.50
Construction Division:
Board feet needed	55000
Outside price paid per bd. ft.	$2.00

If the Lumber Division sells to the Construction Division, $0.25 per board foot can be saved in shipping costs. If current outside sales are 130000 board feet, what is the minimum transfer price that the Lumber Division could accept?

$2.25

$1.50

$1.75

$2.00