Pick the best answer.

Maynard, Juliana, Les, and Regine are trying to form a band. They each have some basic skills on most instruments, so their current plan is for each of them to rotate among vocals, guitar, bass, anddrums.

After a year of practice and rehearsals the band still sounds awful. Maynard cannot keep a steady beat when on bass or drums, Les sounds terrible on everything except the bass, nobody except Juliana can remember all the chords on guitar, and even Regine's own mother thinks her singing sounds like a dying cow. At their current rate, they expect it will be several years before they are good enough to land their first paid performance. None of them have enough money saved up to last thatlong.

They all know you are taking economics and ask your advice. What would you say tothem?

1. Invest their remaining savings in new instruments, as they are at a point where the marginal product of capital exceeds the marginal product oflabor.
2. Abandon the band, as continued practice is doomed to suffer diminishing marginalreturns.
3. Continue with the current plan, as economies of scale should eventually kickin.
4. Change the rotation to be random rather than equal to take advantage ofheteroskedasticity.
5. Have each member specialize in the role that they are best in to take advantage of benefits fromspecialization.