Does your company use transfer pricing to charge divisions for the cost of the products they consume?

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Does your company use transfer pricing to “charge” divisions for the cost of the products they consume? Are these prices set equal to the opportunity cost of the product? Why or why not? Can you think of a better organizational architecture? Compute the profit consequences of changing the organizational architecture.

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Managerial Economics

ISBN: 9781337106665

5th Edition

Authors: Luke M. Froeb, Brian T. McCann, Michael R. Ward

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