Which of the Following Statements Is True Regarding,business Format Franchises

question 6

Multiple Choice

Which of the following statements is true regarding,business format franchises?

• A) The franchisor provides a system for the franchisee to operate the business.
• B) Franchisee operational efficiency is more important than working relationships between franchisors and franchisees
• C) The franchisor provides little beyond a license to use its trademarked products.
• D) They are most common among automobile and soft drink channels.
• E) The details of franchise management are vague enabling franchisees to adapt to changing environmental conditions.

---

Definitions:

Cross-Hedging

A strategy used to manage risk by hedging a position in one asset with a position in another asset that has a similar price movement but is not identical.

Bauxite

The primary ore of aluminum, consisting primarily of aluminum oxide minerals, clay minerals, and insoluble materials.

Aluminum Ore

The natural mineral compound from which aluminum is extracted, primarily bauxite.

Aluminum Futures

Contracts to buy/sell aluminum at a future date at a price agreed upon today, used for hedging or speculation on the aluminum market.