Firms That Have Designed a Unique Approach for Performing a Service

question 10

Multiple Choice

Firms that have designed a unique approach for performing a service and wish to profit by selling the franchise to others employ

• A) a customer-generated franchising system.
• B) a service-sponsored retail franchise system.
• C) a agent-sponsored wholesale franchise system.
• D) a manufacturer-sponsored retail franchise system.
• E) an administered vertical marketing systems.

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Definitions:

Fixed Costs

Expenses that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.

Indirect Labor

Labor costs not directly tied to the production of goods or services, such as salaries of supervisors and maintenance staff.

Direct Labor Hours

The cumulative hours expended by workers directly engaged in the manufacturing of products or provision of services.

Static Budget

A budget that remains unchanged regardless of changes in activity levels, sales volume, or other variables during the budget period.