Janet planned to purchase a McDonald's franchise. Meanwhile, Jason decided to open his own sandwich shop. Both decided to finance their new business ventures by applying for bank loans. Janet's loan application was approved, but Jason's was denied. Which of the following is the most likely explanation for these results?
A) Banks view franchises as having fewer risks than other startup businesses.
B) Banks can charge higher interest rates when financing franchisees.
C) Banks consider women business owners to present fewer risks than those who are men.
D) Banks prefer to lend to companies that have the potential of a public stock offering.
Correct Answer:
Verified
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