Because Customers View Franchises as an Entire Unit,which of the Following

question 117

Multiple Choice

Because customers view franchises as an entire unit,which of the following can have a negative effect on a franchisee's business?

• A) Overdependence or unsatisfied expectations
• B) Risk of fraud or misunderstanding
• C) Problems of termination or transfer
• D) Poor performance of other franchisees

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Definitions:

Marginal Cost

The augmentation in cost due to the manufacture of one additional unit of a product or service.

Total Variable Cost

The sum of all costs that vary with the level of output, including materials and labor directly involved in production.

Output

The quantity of goods or services produced in a given period by a firm, industry, or country.

Total Cost

The combined amount of all expenses and costs associated with the production and sale of a good or service.