49*. UMUC Corp. has two divisions, Europe and Asia. Europe produces a widget that Asia...
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49*. UMUC Corp. has two divisions, Europe and Asia. Europe produces a widget that Asia could use in its production. Europe's variable costs are $2 per widget while the full cost is $3.50. Widgets sell on the open market for $6 each. If Europe has excess capacity and will transfer at its lowest cost possible in order that it will not make any additional profit, what would be the cost savings for the entire corporation if the transfer was made and Asia currently is purchasing 100,000 units on the open market? A. $400,000 B. $350,000 C. $600,000 D. $0
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