Gamma Corporation, one of the firms that retains you as a financial analyst, is considering buying out

Question:

Gamma one of the firms that retains you as a financial analyst, is considering buying out Beta a small manufacturing firm that is now barely operating at a profit. You recommend the buyout because you believe that new management could substantially reduce production costs, and thereby increase profit to a quite attractive level. You collect the following product information in order to convince the CEO at Gamma that Beta is indeed operating inefficiently:
MPL = 10 PL = $20
MPK = 15 PK = $15
Explain how these data provide evidence of inefficiency. How could the new manager of Beta improve efficiency?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...