Exam 4: Franchises and Buyouts

The agreement Irma signed with McDonald's that allows her to open a restaurant using the McDonald's name is:

An entrepreneur would choose a franchise over an independent startup most likely because of the

Nardell's franchise contract contains language that prohibits him from opening a similar business under his own brand.Nardell considers this to be:

Quality Dining,Inc.operates several different restaurant franchises including Burger King,Olive Garden,Dairy Queen,and several others.Quality Dining has its own corporate structure and stockholders.This corporation is an example of:

One drawback of becoming a franchisor relates to possible new restrictions as a requirement for contract renewal.

Jill sees an advertisement for a franchise opportunity that matches her interests.Her first step in pursuing the franchise is to look for independent,third-party sources of information to verify that the opportunity is legitimate.

Leonard and the seller have agreed to a price for a business.Leonard cannot pay cash for the entire purchase price so he applied for a bank loan.The bank is likely to:

A Starbucks franchise located inside a Target store is called ______ franchising.

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 party in a franchise contract that specifies the methods to be followed and the terms to be met by the other party

Fred's company specializes in bringing together buyers and sellers of businesses.Fred is:

One possible disadvantage of becoming a franchisor is:

Match: a.due diligence b.fair market value c.franchise d.franchise contract e.Franchise Disclosure Document f.Franchise Rule g.franchisee h.franchisor -An entrepreneur whose power is limited by a contractual relationship with a franchising organization

In what way is a franchisee's control over the business greatly reduced?

Compare and contrast the functions of a master licensee and area developer.

Matthew is an individual acting as a sales agent with the responsibility for finding new franchisees within a specified territory.Matthew is a(n):

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 franchisor's selling of another franchise location within the market area of an existing franchise

Each month Tomas must report his gross sales and pay a percentage of that amount to his franchisor.This percentage is:

Match: a.co-branding b.master licensee c.multibrand franchising d.multiple-unit ownership e.noncompete clause f.non-disclosure agreement g.piggyback franchising h.product and trade name franchising -The operation of a retail franchise within the physical facilities of a host store

Jeffrey's job is to identify potential business people in his country who might want to do business using a particular brand name.When the contract is signed,Jeffrey then provides training to the business person.Jeffrey is most likely:

A nondisclosure agreement signed by a prospective buyer shows the seller that the buyer intends to purchase the business.