Lesser-Known Franchisors Sometimes Enter Foreign Countries with Company-Owned Outlets

question 63

Multiple Choice

Lesser-known franchisors sometimes enter foreign countries with company-owned outlets.A reason for doing this is to ________.

• A) guarantee profits
• B) avoid competition
• C) compete with local stores
• D) attract potential franchisees

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Definitions:

Positive Economic Profits

Positive economic profits occur when a firm's total revenues exceed its total costs, inclusive of both explicit and implicit costs.

Monopolist

An entity that is the sole provider of a particular product or service in the market, possessing the power to significantly influence prices and supply.

Maximum Profit

The highest possible financial gain a firm can achieve when all factors of production are optimized.

Memory Company

A business specializing in the production of memory storage devices, such as RAM and flash memory.