Alfa Ltd. has two decentralised divisions, D1 and D2 . D1 has always purchased certain units from D2 at `300 per unit. As D2 plans to raise the price to `400 per unit, D1 desires to purchase these...

Alfa Ltd. has two decentralised divisions, D1 and D2 . D1 has always purchased certain units from D2 at `300 per unit. As D2 plans to raise the price to `400 per unit, D1 desires to purchase these units from outside suppliers for `300 per unit. The costs of D2 are as follows:

If D1 buys from an outside supplier, the facilities D2 uses to manufacture these units would remain idle. From the viewpoint of the company as a whole, should D1 purchase from D2 at `400 per unit, or from outside at `300 per unit?