The optimal transfer price when there are intermediate markets is:
A) full cost.
B) outlay costs.
C) variable cost.
D) market prices.

Question

Quizplus · Accepted Answer

The best choice for transfer price when there are intermediate markets is market prices. This is because intermediate markets already have established prices for goods and the transfer price should reflect those prices to ensure fairness and efficiency in the overall supply chain. Using full cost, outlay costs, or variable cost may lead to inefficiencies and distortions in the market.

The Optimal Transfer Price When There Are Intermediate Markets Is