Question
When a McDonald's opens In your local area by franchising to a franchisee, what is the benefit to the McDonald's corporatic McDonald's corporation is avoiding the financial investment and liability of a chain of stores. McDonald's corporation is benefiting by adding one more location to its chain of stores. McDonald's corporation benefits by increasing by having a new equal partnership with its franchisee. McDonald's is guaranteed to yield high revenues from the new location.
Solution
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MiahProfessional · Tutor for 6 years
Answer
A. McDonald's corporation is avoiding the financial investment and liability of a chain of stores.<br />B. McDonald's corporation is benefiting by adding one more location to its chain of stores.
Explain
When a McDonald's opens a new franchise location, the corporation benefits primarily by expanding its brand presence and increasing market share without the need for direct financial investment and liability. This model allows McDonald's to grow and earn royalties from the franchise operation while transferring the risks and costs to the franchisee. Therefore, the most relevant benefit to the McDonald's corporation is avoiding financial investment and liability while adding a new location to its chain. The statements about equal partnership and guaranteed high revenues are not primary corporate benefits in this context.
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