McDonald's Operates Through a Franchising System Wherein the Head Office

question 87

Multiple Choice

McDonald's operates through a franchising system wherein the head office uses strategic and financial controls to ensure that the franchises are creating the greatest possible value.This is an example of a(n) :

• A) worldwide product divisional structure.
• B) strategic network.
• C) SBU multidivisional structure.
• D) simple structure.

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Definitions:

Investment Opportunity

A potential venture or project that promises returns or profits to the investor.

Combined Margin

The total margin that results from combining the gross margin and net margin of a company.

Contribution Margin Ratio

A financial metric that shows the percentage of sales revenue that is not consumed by variable costs and contributes to covering fixed costs.

Fixed Expenses

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