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McDonald's Requires That Franchisees Provide at Least 40 Percent of the Cost

Question 18

Multiple Choice

McDonald's requires that franchisees provide at least 40 percent of the cost of the franchise with their own funds and work full-time daily in the restaurant. It does this in order to avoid


A) signaling and screening
B) moral hazard
C) the winner's curse
D) adverse selection
E) symmetrical information

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