Question 1

The largest U.S.franchise restaurant system in China is&#10;A)McDonald's&#10;B)KFC&#10;C)Wendy's&#10;D)Burger King

Accepted Answer

KFC now has over 1,600 outlets in China,and there are now more than 2,300 different franchise systems in China

Question 2

The most common restrictions levied by a government in international trade are?&#10;A)quotas&#10;B)tariffs&#10;C)embargo&#10;D)exchange controls

Accepted Answer

Tariffs-taxes levied by a government against specific imported products-are the most common restrictions in international trade

Question 3

The least favorite method of entering foreign markets is by investing in company-owned stores in foreign countries and this is called?&#10;A)licensing&#10;B)joint venture&#10;C)direct investment&#10;D)master franchising

Accepted Answer

The fourth method of entering foreign mar?kets is direct investment,by which the franchisor simply invests in company-owned stores in foreign countries

Question 4

One of the very few companies that has been successful in using the exact same product world-wide is:&#10;A)Coca-Cola&#10;B)McDonald's&#10;C)Dairy Queen&#10;D)Marriott Hotels

Accepted Answer

Generally,the Coca-Cola Company has been very successful in using this method to introduce its soft drink throughout the world;however,straight product utilization has failed for other companies because many cultures simply do not use the same products that we do in the United States

Question 5

A product strategy which involves changing the product to meet local conditions and consumer demands is called:&#10;A)product conversion&#10;B)product adaptation&#10;C)straight product utilization&#10;D)product invention

Accepted Answer

The second product strategy is called product adaptation and involves changing the product to meet local conditions and consumer demands

Question 6

Probably the main hindrance with expanding into foreign markets is:&#10;A)high costs&#10;B)government red tape&#10;C)labor supply&#10;D)lack of master franchisees

Accepted Answer

Many American franchisors have voiced their reluctance to expand into foreign countries because of government red tape,high costs,and import restrictions

Question 7

The most common and best way of starting a franchise in a foreign country is through?&#10;A)licensing&#10;B)joint venture&#10;C)direct investment&#10;D)master franchisee

Accepted Answer

The master franchisee maybe an individual,small business,large corporation,or conglomerate which assumes the rights and obligations of establishing franchises throughout the country

Question 8

The future for international franchising is:&#10;A)bright and promising&#10;B)promising,but uncertain&#10;C)difficult,but rewarding&#10;D)yet to be determined

Accepted Answer

Franchising will be an even more prevalent method of doing business in the future.Today over 40% of all retail sales in the U.S are through franchised outlets

Question 9

When developing franchise systems in a developing foreign country the first kind of franchises to develop in that country are:&#10;A)domestic franchises&#10;B)foreign retail franchises&#10;C)domestic hospitality franchises&#10;D)foreign hospitality franchises

Accepted Answer

The first sources of franchising in a foreign country are generally found in the foreign hospitality industry including hotels and convenience or fast-food restaurants

Question 10

It is expected that by the year 2010,how many of all U.S.franchisors will have foreign outlets?&#10;A)less than 25 %.&#10;B)between 25 - 40%&#10;C)between 41 - 55%&#10;D)more than 55%

Accepted Answer

It is expected that 60% will have foreign outlets

Deck 22: International Franchising