When a Firm Establishes a Long-Term Contract with Another Firm

question 33

Multiple Choice

When a firm establishes a long-term contract with another firm where the first firm grants a second independent business the rights to use the first firm's name, reputation and business format, this is a:

• A) standard supply contract.
• B) joint venture.
• C) lease contract.
• D) franchise agreement.

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Definitions:

Termination

The act of ending or concluding something, such as a contract, employment, or agreement.

Misrepresentation

Deliberately providing false information to another party, leading them to make decisions they otherwise wouldn't have.

Reliance

In legal terms, it refers to the act of trusting or acting based on the promises or statements of another party, often relevant in contract law.

Marshaling of Assets

A legal principle requiring the fair and orderly distribution of a debtor's assets among creditors, especially when the debtor has multiple debts secured by the same assets.