1. [25] For the answer to this question, use Hilton's rule for transfer pricing. The Rio Grande Valley (RGV) Cigar Company makes cigars from tobacco grown in the valley at their subsidiary Rio Grand Valley (RGV) Tobacco Farms. Now, tobacco is cured with multiple leaves gathered together and called a hand. RIV Tobacco Farms can produce a maximum of 20,000 hands of tobacco during the growing season. Once grown and cured,55 the hands can be sold on the local tobacco market for $5.00 per hand, but it costs only $3.00 per hand to grow and cure the tobacco. Local demand for tobacco is 7,000 hands. If RGV Cigar Company only needs 15,000 hands of tobacco. What should the transfer price be to the RGV Cigar Company? If instead, RGV Cigar Company only wants 12,000 hands of tobacco, what should the transfer price be? (Please show all of your work with Hilton's formulas, etc. to receive full credit.)