In order to avoid principal-agent problems, McDonald's uses all but one of the following franchising tactics. Which is the exception?
a. It does not advertise for franchisees.
b. Franchisees must put up 40 percent of the investment themselves.
c. Franchisees must undergo a preliminary training period, followed by a 12- to 18-month training program.
d. Franchisees must already have another fast-food restaurant franchise.
e. Franchisees are required to work full-time daily in their restaurant.
D
You might also like to view...
Variable costs are
a. the same as sunk costs b. irrelevant to decision making, because they are sunk c. the costs of inputs that vary with the level of production d. the costs of inputs that do not vary with the level of production e. the additional total cost associated with producing an additional unit of output
If a resource is nonrenewable and we use 2 percent of its supply per year,
a. it will gradually be depleted b. its supply will be constant regardless of use because it has the nonrenewability property c. it will become renewable as its supply approaches zero d. it could never be depleted because 2 percent of a diminishing supply is an increasing amount e. it will decrease at a diminishing rate so that its supply will approach its initial quantity