Which of the Following Scenarios Best Illustrates a Franchise

question 17

Multiple Choice

Which of the following scenarios best illustrates a franchise?

• A) The owner of a coffee plantation agrees to export coffee beans to stores in Italy.
• B) An automobile manufacturer imports materials required for car manufacture from a distributor in Canada.
• C) An online merchandising company builds a warehouse in Great Britain.
• D) A fast food restaurant permits a business owner in Belgium to operate a restaurant that uses its trademark.

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Definitions:

Beta Coefficient

A measure of a stock's volatility in relation to the overall market, indicating its risk level.

Market

An area or arena in which commercial dealings are conducted, often defined by the exchange of goods, services, or information between buyers and sellers.

Required Rate of Return

The minimum expected yield by investors to compensate for the risk of holding a particular investment.

Beta

An indicator of how much the risk of a security or a portfolio, known as systematic risk, fluctuates in relation to the overall market.