PRC-3 · Chapter 2 · Question 61 of 61
A local entrepreneur pays a large initial fee and agrees to pay ongoing royalties to an international fast-food brand in exchange for the right to use their logos, recipes, and business model. This arrangement is a:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Franchise
Explanation
A franchise is a legal and commercial agreement where one party (franchisee) buys the right to use the brand, system, and intellectual property of another firm (franchisor).
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