Which of the Following Statements Is Incorrect Regarding Business Format

question 65

Multiple Choice

Which of the following statements is incorrect regarding business format franchises?

• A) Arby's sells business format franchises.
• B) A business format franchises can be very rigid and demanding.
• C) Automotive services and convenience stores are well-known examples of business format franchises.
• D) In a business format franchise, the franchisor provides a formula for doing business to the franchisee along with training and other forms of support.
• E) The business format franchisor obtains the majority of its income from selling its products to its dealers at a markup.

---

Definitions:

Rival

In economics, a rival good is one whose consumption by one person reduces its availability for another person.

Non-Excludable

A characteristic of a good or service that prevents individuals from being effectively excluded from using it.

Pair of Jeans

A Pair of Jeans is an item of clothing made from denim or another fabric, characterized by its durability and typically fastened with buttons or zippers.

Free Goods

Free goods are resources or services that are available in abundance and do not have an opportunity cost, meaning they can be consumed in unlimited quantities without depleting any resource.