A License to Sell Another's Products or to Use Another's

question 9

Multiple Choice

A license to sell another's products or to use another's name in business is called a

• A)franchise.
• B)franchisee.
• C)franchiser development system.
• D)franchise logo.
• E)franchiser.

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Definitions:

Explicit Costs

Direct, out-of-pocket payments for wages, rent, materials, and other inputs necessary for the production of goods or services.

Implicit Costs

The opportunity costs of using resources owned by the firm for its own use, without any direct payment made.

Opportunity Cost

The worth of the best alternative given up to make a choice.

Accounting Profit

The financial gain calculated by subtracting total expenses from total revenues, according to standard accounting principles.