Which Statement Is True About Franchisor Liability for the Acts

question 37

Multiple Choice

Which statement is true about franchisor liability for the acts of a franchisee?

• A) Franchisors are liable for acts of their franchisees in most circumstances.
• B) Franchisors are never liable for the acts of their franchisees, unless the franchisor was a party to the act of the franchisee.
• C) Whether a franchisor is liable for the acts of its franchisee depends exclusively on the terms of the franchise agreement.
• D) Franchisors are usually not liable for the acts of their franchisees, but they can be liable if the court recognizes the existence of an apparent agency.
• E) Whether the franchisor is liable for the acts of its franchisee is based on whether the franchisee has sufficient funds to pay any judgment.

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Definitions:

Standard Machine-Hours

A predetermined measure of how many hours machinery should be operated to meet production goals, used for planning and efficiency analysis.

Variable Overhead Rate Variance

The difference between the actual variable overhead costs incurred and the standard cost of the variable overhead that should have been incurred based on the actual activity level.

Critical Part

Critical Part refers to a component or element of a system that is essential to its function, where failure could lead to a system stoppage or serious defect.

Commercial Airline Seats

The seats available for purchase on a commercial aircraft, categorized into various classes like economy, business, and first class.