If the Minimum Efficient Scale in the Production of Rubber

question 89

Multiple Choice

If the minimum efficient scale in the production of rubber exceeds the quantity of rubber any individual tire producer buys,

• A)tire producers should integrate backward into rubber production
• B)there will be a monopoly in rubber production
• C)tire producers should not integrate backward into rubber production
• D)tire producers will be charged prices above what the cost of producing rubber themselves would be
• E)tire companies will switch to fiberglass

---

Definitions:

Registration Statement

A document submitted to a regulatory authority, detailing the specifics of a company’s proposed public offering or securities issuance.

Press Release

An official statement or announcement issued to the news media for the purpose of providing information, an official comment, or making an announcement.

Tender Offer

An offer to purchase some or all of shareholders' shares in a corporation, typically at a premium to the market price, as part of a corporate acquisition or buyback.

Equity Securities

Financial instruments representing ownership interest in a corporation, such as stocks, which confer certain rights like voting and profit sharing.