Nico is interested in buying a franchise from Oz Inc. For Nico to make an informed decision concerning this purchase, Oz must disclose in writing or online

Question

Quizplus · Accepted Answer

Oz Inc. must disclose material facts such as the basis of projected earnings figures. This is required under the Federal Trade Commission's Franchise Rule, which sets standards for franchisors to provide prospective franchisees with information needed to evaluate the investment. Providing general estimates of costs and sales without the basis for them may not give Nico a clear understanding of what to expect, while providing no information at all would not allow Nico to make an informed decision. Start-up requirements may be helpful, but renewal conditions should also be disclosed.

Nico Is Interested in Buying a Franchise from Oz Inc