What are the benefits of a franchise contract?
A franchise agreement specifies the obligations of the two parties in accordance with their individual skills. For example, the parent organization can use its familiarity with the national market to design and finance more effective advertising, and it can use bargaining power over large volumes to negotiate low prices for supplies used in the outlets. On the other side a franchisee whose personal income rises with his outlet's might make more sales effort than a salaried employee of the parent. The owner may also have better information about local opportunities than the parent. If both parties keep the agreement their combined efforts will help them compete against other vertical chains in their market.
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A supply curve shows
A) the marginal cost of producing one more unit of a good or service. B) the marginal benefit from buying one more unit of a good or service. C) the quantities sold at different prices. D) the total cost of producing different quantities of a good or service.
The big labels in the music industry, such as Sony, Time-Warner, and Universal, are churning out thousands of CD albums each year that compete against each other for your dollar. But, considering the CD industry only, they also compete against
a. records b. cassette tapes c. used CDs d. stereos e. used textbooks
All players have dominant strategies.
Answer the following statement true (T) or false (F)
Which of the following is a variable cost for a taxi driver?
a. monthly car payment b. car insurance payment c. taxi licensing fee d. fuel costs