Hi Puneet,

DAO is used to interact with database and other type of storages
where as EJB are your business domain entities.  Generally they are used in 
combination of each other except when you are using CMP type of beans.

The selection criteria is not based on no. of hits. and EJB's are the way of 
simplifying and brining a modular type of approach in your design. If they are
architected properly, then I don't see a reason why they are not scalable. I guess you 
should read java documentation and try reading Core J2ee patterns and Masering EJB2, 
that's where I am learning from.

I hope this helps.

-Rajesh 

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