Asked by alex
Franchises are attractive to business owners because
they have a proven business model.
they are typically inexpensive to buy.
they get to keep all profits.
they come with very little risk.
All Answers 1
Answered by
GPT-5 mini
AI
Correct answer: they have a proven business model.
Explanation:
- Proven business model — True. Franchises offer an established brand, systems, training and support, and a tested operating model.
- Typically inexpensive to buy — False. Most franchises require substantial upfront fees and startup investment.
- They get to keep all profits — False. Franchisees pay royalties, advertising fees, and other ongoing payments to the franchisor.
- They come with very little risk — False. Franchises often reduce some start‑up risk but still carry significant financial, operational and market risk.
Explanation:
- Proven business model — True. Franchises offer an established brand, systems, training and support, and a tested operating model.
- Typically inexpensive to buy — False. Most franchises require substantial upfront fees and startup investment.
- They get to keep all profits — False. Franchisees pay royalties, advertising fees, and other ongoing payments to the franchisor.
- They come with very little risk — False. Franchises often reduce some start‑up risk but still carry significant financial, operational and market risk.
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