A hub should be placed at the highlighted box to produce a total of two broadcast domains and seven collision domains in the network. Network devices segment collision domains and broadcast domains in the following manner:
* Hub: A Layer 1 device with all ports in same collision domain and broadcast domain.
* Bridge/Switch: Layer 2 devices on which all ports are in different collision domains, but in the same broadcast domain (assuming that all ports are in the same VLAN or no VLAN is configured).
* Routers: A Layer 3 device on which every port is a separate collision as well as broadcast domain.

The bridge shown in the graphic has three ports populated by active links, resulting in three collision domains. The switch shown in the exhibit has four ports populated with the links, resulting in four collision domains. Together these two devices create seven collision domains. Because the scenario requires that there be no more than seven collision domains, the device in the highlighted box must not create any further collision domains. A hub is a device that has all its ports in the same collision domain and will not create any further collision domains in the topology.

A bridge or switch cannot be the correct option because these will also add collision domains.

In the exhibit, the router has two ports with active links, which will result into two broadcast domains. Because the scenario states there are no more than two broadcast domains, the device in the highlighted box must not be a router. Routers are used to segment broadcast domains.