Which of the Following Is Characteristic of Master Franchise Arrangements

question 89

Multiple Choice

Which of the following is characteristic of master franchise arrangements?

• A)subfranchises to other independent businesses and thus assumes the role of the local franchisor
• B)franchisee provides completely standardized business activities, replicated across diverse markets
• C)franchise networks where franchisor provides a lump-sum payment to get started in a foreign market
• D)franchise networks that pay fewer royalties to franchisors

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Definitions:

Net Profit Margin Ratio

A profitability measure that calculates the percentage of net income derived from total revenues.

Operating Expenses

Operating expenses encompass the costs associated with running the day-to-day operations of a business, excluding the cost of goods sold, such as rent, utilities, and payroll.

Net Profit Margin

A financial metric that shows the percentage of profit derived from revenue after all expenses are deducted.

Financial Information

Data related to the financial performance and financial position of a company, including income statements, balance sheets, and cash flow statements.