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Midas Muffler Sells Franchises to Prospective Businesspersons Who Want to Use

question 257

Multiple Choice

Midas Muffler sells franchises to prospective businesspersons who want to use the Midas name and offer Midas products. In a franchise arrangement, Midas would be the __________, and the buyer of the franchise is the __________.


Definitions:

Punitive Damages

Financial compensation awarded to a plaintiff that goes beyond what is necessary to compensate for losses and is intended to punish the defendant for egregious conduct.

Illegal Penalty

A punishment or consequence for an action that is not legally authorized or that exceeds the bounds set by legal statutes.

Power of Avoidance

The legal ability to declare a contract null and avoid its obligations due to reasons such as fraud, misrepresentation, or other substantive grounds.

Contractual Capacity

The lawful capacity of an individual to engage in a contract that is enforceable.

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