What Is a Likely Reason Why Someone Would Pay Money

question 92

Multiple Choice

What is a likely reason why someone would pay money for a franchise?

• A)they are not aware of basic business practices
• B)they will not have to spend the same amount of time marketing and building the brand
• C)they do not have knowledge in the industry or business model
• D)they will not have to work as hard in running the business

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Definitions:

Dividend Payout Ratio

The percentage of a company's earnings distributed to its shareholders in the form of dividends.

AFN

Additional Funds Needed; the extra funding required by a firm to support its operations and growth.

Additional Funds Needed (AFN)

The projected amount of new external funding required by a firm to support its business expansion and meet its capital requirements.

Target Payout Ratio

Percentage of net income paid as a cash dividend.