Exam 36: B: Sole Proprietorships and Franchises

A franchisor's decision to terminate a franchise may be made in the normal course of business operations.

Jody owns KuppaJava Kiosks,a sole proprietorship.Jody's liability is

Pilar is interested in buying a franchise from Quixotic Bike Corporation.Quixotic must disclose material facts that Pilar needs to make an in?formed decision concerning this purchase,according to

Echo enters into an agreement with Deep Pan Pies,Inc. ,to operate a franchise in Centre City.Later,Deep grants franchises to others within the city.Echo files a suit to close them.If the court rules in Echo's favor it will most likely be on the ground that

Flip Gymnastics & Karate,Inc. ,grants a franchise to Gibby to operate a Flip gym.Flip may require Gibby to pay the franchisor a percentage of his

Some states require franchisors to provide presale disclosures to pro?spective franchisees.

Real Events Promotion Corporation licenses trademarks to Stadium Souvenirs,Inc. ,to use in selling caps,sweatshirts,and similar goods.This is

Owen plans to open Owen's Pets Store,a pet supplies outlet,and to hire Quinn and Ruth.Owen will invest only his own money.He does not ex?pect to make any profit for at least two years and to make almost no profit for the first three years,but he hopes to expand eventually.Which form of business organization would be most appropriate?

Hermione starts up,and assumes the financial risk of,Graphic Ads,a new enterprise.Hermione is

A sole proprietorship lacks continuity on the death of the proprietor.

Good faith and fair dealing are not important in terminating a franchise relationship.

A manufacturer's license to a dealer to sell a product is a chain-style business operation.

A franchise is a contractual arrangement.

Sweet Styles,Inc. ,a franchisor of clothing stores,wishes to standardize the pricing practices of its franchisees that have engaged in price-cutting to increase their respective shares of the market.The most pru?dent action might be for Sweet to

A franchisor can require a franchisee to purchase certain supplies from the franchisor at an established price.

Star Resorts Corporation wants to terminate its franchise arrangement with Tony.Their contract does not provide for notice of termination or set a time for winding up the business.This means that to wind up,Tony

Mika buys a Nuance Cabinets,Inc. ,franchise,which the franchisor later termi?nates.In determining whether the termination was proper,a court will generally

Laws governing franchising are designed in part to prevent franchisors from terminating franchises without good cause.

Effervescent Soda Bottling Company is

Leo buys an exclusive territory in which he is authorized to set up a plant to make Midwest Dairy,Inc. ,products.After receiving the formula,Leo begins making Nice Ice-brand ice cream and other Midwest prod?ucts.This is