Discussion

Explanation:

The share price of Ratan Brothers has started falling as the shareholders believe the allegation of Dev and Sons that a bribe was paid by the current supplier to get the contract for ball bearings. The investors would be under the impression that the quality of such ball bearing would not be good. However, as Bhushan has stated that he switched to a new supplier because of deficiencies in Dev and Sons’ product, it will be appropriate for the company to declare that there was no decline in the company's quality standards. Also, the company has to state that the shift in supplier has led to an increase and that anyone is welcome to scrutinize the relevant documents. Thus, the appropriate course of action is [3]. [1], [2] and [4] are counter-productive as they imply a wrongdoing from the part of the company. [5] is also incorrect as doing nothing is not an option when share prices are falling.
Hence, the correct answer is option 3.

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