Exam 4: Franchises and Buyouts

Martina's franchise agreement allows her to open up to seven new stores within a 100 mile radius of the first one.Martina is best described as:

The buyer of an existing business typically acquires its personnel,inventories,physical facilities,established banking connections,and ongoing relationships with trade suppliers.

Individuals or firms that possess the legal right to open multiple outlets in a given area are referred to as

Where would you suggest Xavier look for information about possible franchise opportunities?

Cheryl is on vacation across the country from her hometown and she's hungry.Ahead she sees the familiar Golden Arches and knows she can find her favorite hamburger.These Golden Arches are:

Besides the up-front money required of a franchisee,Stuart will have to pay building costs and purchase inventory and equipment.This type of expense is called:

A wise buyer will also evaluate the legal commitments of an existing business.

Match: a.due diligence b.fair market value c.franchise d.franchise contract e.Franchise Disclosure Document f.Franchise Rule g.franchisee h.franchisor -The legal document between a franchisor and a franchisee

Rick was so successful with his Sweet Treats franchise that he opened several other Sweet Treats locations.Rick could best be described as:

The seller of an existing business placed a high value on his experienced employees.The buyer should be wary of this because:

Geraldo owns a well-known brand and allows Henry to sell products with that brand name.Geraldo has agreed to:

To control costs when purchasing a business,an attorney at the closing can represent both sides.

Financial statements can mislead a potential purchaser trying to develop an accurate business valuation.

Match: a.due diligence b.fair market value c.franchise d.franchise contract e.Franchise Disclosure Document f.Franchise Rule g.franchisee h.franchisor -A rule that prescribes that the franchisor must disclose certain information to prospective franchisees

One of the most important features of the franchise contract is the provision related to

Match: a.due diligence b.fair market value c.franchise d.franchise contract e.Franchise Disclosure Document f.Franchise Rule g.franchisee h.franchisor -A business model involving a business owner who licenses trademarks and methods to an independent entrepreneur

Caron signed a contract with Devon allowing her to provide services using Devon's trademark,logo,and business model.This business is:

The unscrupulous actions by franchisors to void contracts of franchisees in order to sell the franchise to someone else and collect an additional fee is called chewing.

Sister Mary Cupcake has partnered with the management of the toll road to operate her stores in the travel plazas.This arrangement is an example of:

The franchising strategy whereby an individual or firm is granted the legal right to own more than one unit of a franchised business is known as