Question

Drag and drop the appropriate words to complete, Disclosure Requirements for Franchisor Under the FTC’s Franchise Rule..

a. Written or electronically recorded disclosures treating the range of goods and services included in the value and estimated ___ of the franchise.

b. To prevent deception, all representations made to prospective franchisees must have a ___ basis at the time they are made.

c. If a franchisor provides projected earnings, the franchisor must indicate whether they are based on ___ data or hypothetical examples.

d. If actual data are used to make earnings projections, the franchisor must disclose the ___ , and percentage of its existing franchises that have achieved this result.

e. Franchisors must ___ termination, cancellation, and renewal provisions of the franchise contract.

Fill in the blanks with words that would best complete the passage.

number

profitability

actual

preferable

explain

percentage

anticipated

reasonable

Answer 1

a. Written or electronically recorded disclosures treating the range of goods and services included in the value and estimated profitability of the franchise.

b. To prevent deception, all representations made to prospective franchisees must have a reasonable basis at the time they are made.

c. If a franchisor provides projected earnings, the franchisor must indicate whether they are based on actual data or hypothetical examples.

d. If actual data are used to make earnings projections, the franchisor must disclose the number , and percentage of its existing franchises that have achieved this result.

e. Franchisors must explain termination, cancellation, and renewal provisions of the franchise contract.