Franchising is a form of business ownership in which a firm that already has a successful product or service licenses its trademark and method of doing business to other business in exchange for:

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Franchising typically involves the initial payment of a franchise fee, which grants the franchisee the right to use the franchisor's trademark and business model. In addition, the franchisee usually pays an ongoing royalty based on a percentage of sales. Therefore, the best choice is A, which includes both an initial franchise fee and an ongoing royalty. Options C and E are not common in franchising, as franchisors generally do not take equity positions in their franchisees' businesses.

Franchising Is a Form of Business Ownership in Which a Firm