Kyle owns a Cars-To-Go franchise.Kyle's franchising contract stipulates that he must purchase the cars he rents from the national Cars-To-Go franchisor,although Kyle could save money by purchasing cars from a local dealership.Which term best describes this contract requirement?
A) supply fees
B) tied sales
C) sunk costs
D) front end fees
E) territorial exclusivity

Question

Quizplus · Accepted Answer

Tied sales refer to a situation in which the purchase of one product or service is contingent upon the purchase of another product or service. In this case, Kyle's franchising contract requires him to purchase cars from the national Cars-To-Go franchisor rather than a local dealership, which is an example of tied sales.

Kyle Owns a Cars-To-Go Franchise