Ouzts Corporation Is Considering Alternative a and Alternative B

question 153

Multiple Choice

Ouzts Corporation is considering Alternative A and Alternative B. Costs associated with the alternatives are listed below: What is the financial advantage (disadvantage) of Alternative B over Alternative A?

• A) $105,000
• B) $23,000
• C) $128,000
• D) $116,500

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Definitions:

Exclusive Territory

A specific geographic area granted to a retailer, distributor, or franchisee in which they are the only ones allowed to sell certain products or services.

Dairy Products

Foods made from milk, including but not limited to cheese, yogurt, milk, butter, and ice cream, which are produced by mammals such as cows, goats, and sheep.

Chain-Style

A business model that involves establishing multiple outlets under the same brand and management, typically in different locations.

Federal Franchise Rule

A regulation established by the Federal Trade Commission that requires franchisors to provide full disclosure of material facts to prospective franchisees.