Why Is the Sharing of Profits a Drawback to Becoming

question 32

Multiple Choice

Why is the sharing of profits a drawback to becoming a franchiser?

• A) The franchisee will not share profits.
• B) Only part of the profits from the franchise operation belongs to the franchiser.
• C) There are usually no profits to share.
• D) The sharing of profits reduces the franchiser's control.

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Definitions:

Accumulate Wealth

The process of gathering and increasing assets, resources, or money over time.

Federal Housing Administration

A U.S. government agency created in 1934 to improve housing standards and conditions, provide an adequate home financing system, and to stabilize the mortgage market.

Private Housing Market

The segment of the housing industry where ownership and rental of property is controlled by private individuals and companies, as opposed to public or government entities.

Loan Denial

The refusal by a financial institution to grant a loan based on various factors including the applicant's credit history, income, or discrimination.