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QuizMultiple Choice

Business Structures

Question 1 • * HSA 26-27 Economics

Franchises are attractive to business owners because

Answer
t
they have a proven business model.
t
they are typically inexpensive to buy.
t
they get to keep all profits.
t
they come with very little risk.

Explanation

Franchises often appeal to business owners because the franchisor has already established a business model, brand, and operating methods. This gives the owner a tested approach to follow, though success is not guaranteed. Franchises can be costly and still involve risks, and franchisees generally share revenue through fees or royalties rather than keeping all profits.

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