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HSA Final Exam – Questions & Full Detailed Answers
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HSA Final Exam – Questions & Full Detailed Answers
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HSA Final Exam – Questions & Full Detailed AnswersWhen discussing independents and chains
a) there are few competitive advantages of independents as compared with
chains.
b) franchised units have aspects in common with chains but not with
independents.
c) independents have strengths in some areas that chains find difficult to
compete with.
d) the role of chains is changing but that of the independent has remained
static. Correct Ans - c) independents have strengths in some areas
that chains find difficult to compete with.
Economy of scale means
a) that as a chain grows the unit cost of centralized activities decreases.
b) the benefits of advertising are more advantageous to the independent
operator.
c) the opposite of the "additive effect."
d) that reductions in total cost are made. Correct Ans - a) that as a
chain grows the unit cost of centralized activities decreases.
The market share of restaurant sales controlled by the 100 largest chains is
a) one-fourth.
b) one-third.
c) over half.
d) two-thirds. Correct Ans - c) over half.
Advantages in the mass media for chain specialty restaurants arise
principally from
a) the fact that chains are represented in more markets.
b) the willingness of consumers to identify with jingles and personalities
like Ronald McDonald.
c) simplicity of message, enormous spending, and the additive effect.
d) public relations efforts in local media which provide a backup to
national advertising. Correct Ans - c) simplicity of message,
enormous spending, and the additive effect.
Access to capital
a) is usually easier for a local operator than for a chain.
, b) for a large company is often coupled with lower borrowing costs.
c) is not a problem for most food service operations since restaurants are
not considered risky businesses.
d) is decreasing for restaurants because of the "credit crunch." Correct
Ans - b) for a large company is often coupled with lower borrowing
costs.
If a restaurant wishes to expand, remodel, or rebuild
a) it is difficult to borrow from a bank if the restaurant is franchised.
b) an independent usually has the advantage over chains because they
know the local people at the bank.
c) a franchisee usually goes to the franchisor for a loan.
d) lower interest rates are often given to publicly traded companies.
Correct Ans - d) lower interest rates are often given to publicly traded
companies
Site selection
a) is also important for the independent restaurant that focuses on a
unique dining experience.
b) is best achieved through the owner's personal experience about the
community.
c) could not cause conflict between the franchisor and the franchisees.
d) has an exact formula to follow. Correct Ans - a) is also important
for the independent restaurant that focuses on a unique dining experience.
A competitive advantage of independents over chain operations is:
a) the independent can move more slowly than a chain in menu change and
see if changes made by a chain work before trying them.
b) the independent is much closer to the operation and can quickly
respond to challenges.
c) the independent has access to more marketing information.
d) the independent can achieve more economies of scale. Correct Ans -
b) the independent is much closer to the operation and can quickly
respond to challenges.
Independents
a) can differentiate their operation by establishing a presence in their
community.
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