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Question asks whether including fixed cost in transfer price is sensible policy?
Normally no, because the fixed costs will remain the same whatever happens. However it depends on the wording of the question.
Have you watched my free lectures on transfer pricing??? The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.
(In future, if you want me to answer then please ask in the Ask the Tutor Forum – this forum is for students to help each other.)
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