Consider a franchise such as mcdonalds which has a


Consider a franchise, such as McDonald's, which has a reputation for cleanliness, a uniform product, and fast service. Suppose a franchise has an outlet and can cut costs by hiring fewer employees, cleaning the restrooms less frequently, and putting less meat in the hamburgers. Thus, this outlet earns abnormally high returns by cutting corners. If this behavior is widespread and unabated, what affects will it have on the stock price of McDonald's Corporation? Why?

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Financial Management: Consider a franchise such as mcdonalds which has a
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