The Criminal Records Corporation Is Operating at Its Minimum Efficient

question 43

Multiple Choice

The Criminal Records Corporation is operating at its minimum efficient scale, selling 10, 000 records per month via late-night cable TV advertising.It currently buys pressed records from Hole-in-the-Middle, Inc., which has a minimum efficient scale of 100, 000 records per month.Which of the following should Criminal Records do?

• A)Continue to buy 10, 000 records from Hole-in-the-Middle, which can make the records more cheaply.
• B)Buy 100, 000 records from Hole-in-the-Middle, so that company can reach its minimum efficient scale too.
• C)Buy Hole-in-the-Middle and use its facilities to manufacture the 10, 000 records it needs.
• D)Buy Hole-in-the-Middle and stop operating as Criminal Records because Hole-in-the-Middle is the more efficient business.
• E)Buy Hole-in-the-Middle and stop operating as Criminal Records because Hole-in-the-Middle is the larger business.

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Definitions:

Refrigeration

The process of removing heat from a space or substance to lower its temperature, often used for preserving food or other perishables.

Tax Returns

Official documents filed with tax authorities declaring income, profits, and losses to determine tax liability.

Post Office

A public institution responsible for mail collection, distribution, and delivery services.

Cash Payments

Transactions where payment for goods or services is made in the form of physical currency or coins.