How Does a Firm Capture Value When Using a Franchise

question 53

Multiple Choice

How does a firm capture value when using a franchise business model?

• A) By receiving fees and royalty payments
• B) By selling a premium version of its product or service
• C) By giving advertisers access to target customers
• D) By matching those who want a service with those who are providing it

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Definitions:

Collection of Revenues

The process of gathering all income generated from various sources, including sales, services, and investments.

Cost of Debt

The effective rate that a company pays on its current debt, incorporating interest payments and other related costs.

Revenue

Revenue is the total amount of money received by a company for goods sold or services provided during a specific period.

Cash Discount

A reduction in invoice amount offered by sellers to encourage early payment by buyers.