BUISENESS MANAGEMENT
BUSINESS STRUCTURE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Wendy’s sells the right to operate its restaurants to individuals who meet the company’s criteria. The arrangement between Wendy’s and these individuals is an example of
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A partnership agreement
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Multi-level marketing
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Licensing
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Franchising
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Explanation:
Detailed explanation-1: -Corporation. A corporation is a legal entity, operating under state law, whose scope of activity and name are restricted by its charter. Articles of incorporation must be filed with the state to establish a corporation.
Detailed explanation-2: -Franchise. A contractual agreement between a parent company and a franchisee to distribute goods or services. Franchisee. One who buys the right to sell the goods or services of the parent company (franchisor)
Detailed explanation-3: -Reduced risk of failure. The business-format franchise arrangement requires a close and continuous working relationship between the franchisor and the franchisee.
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