Guthrie Wire Corporation
The Wire Products Division of Guthrie Wire Corporation produces "bales" of steel wire that are used in various commercial applications. The bales sell for an average of $20 each and The Wire Products Division has the capacity to produce 10,000 bales per month. The Consumer Products Division of Guthrie Wire Corporation uses approximately 2,000 bales of steel wire each month in its production of various appliances. The operating information for the Wire Products Division at its present level of operations (8,000 bales per month) follows:
The Consumer Products Division currently pays $15 per bale for wire obtained from its external supplier.
Refer to Guthrie Wire Corporation. Assuming, for this question only, that the Wire Products Division would not incur any variable selling costs on internal sales, what is the minimum price that it would consider accepting for sales of bales to the Consumer Products Division?

Question

Guthrie Wire Corporation
The Wire Products Division of Guthrie Wire Corporation produces "bales" of steel wire that are used in various commercial applications. The bales sell for an average of $20 each and The Wire Products Division has the capacity to produce 10,000 bales per month. The Consumer Products Division of Guthrie Wire Corporation uses approximately 2,000 bales of steel wire each month in its production of various appliances. The operating information for the Wire Products Division at its present level of operations (8,000 bales per month) follows:
  The Consumer Products Division currently pays $15 per bale for wire obtained from its external supplier.
Refer to Guthrie Wire Corporation. Assuming, for this question only, that the Wire Products Division would not incur any variable selling costs on internal sales, what is the minimum price that it would consider accepting for sales of bales to the Consumer Products Division?

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The Answer of Guthrie Wire Corporation
The Wire Products Division of Guthrie Wire Corporation produces "bales" of steel wire that are used in various commercial applications. The bales sell for an average of $20 each and The Wire Products Division has the capacity to produce 10,000 bales per month. The Consumer Products Division of Guthrie Wire Corporation uses approximately 2,000 bales of steel wire each month in its production of various appliances. The operating information for the Wire Products Division at its present level of operations (8,000 bales per month) follows:
  The Consumer Products Division currently pays $15 per bale for wire obtained from its external supplier.
Refer to Guthrie Wire Corporation. Assuming, for this question only, that the Wire Products Division would not incur any variable selling costs on internal sales, what is the minimum price that it would consider accepting for sales of bales to the Consumer Products Division?

Guthrie Wire Corporation The Wire Products Division of Guthrie Wire Corporation Produces "Bales