Answer: operates under a specific brand with proprietary products and processes.

**Explanation:** In a franchise model: 1. **Franchisee (C)**: The franchisee operates under the franchisor's established brand name, using proprietary products, processes, and business systems. The franchisee pays fees (typically including an initial franchise fee and ongoing royalties) to the franchisor for the right to use the brand and business model. 2. **Franchisor earns royalties (A)**: This is incorrect because it's the franchisor (not the franchisee) who earns royalties on sales from the franchisee. 3. **Franchisor handles product development and advertising (B)**: This is incorrect because typically the franchisor (not the franchisee) is responsible for product development, national advertising, and maintaining brand standards. The franchisee may contribute to local advertising but is not primarily responsible for product development. **Key Points:** - Franchisee: Operates the business using franchisor's brand/system, pays fees - Franchisor: Provides brand, system, support, and earns royalties - The franchise model allows for rapid expansion with consistent brand experience while franchisees provide capital and local management.

Author: LeetQuiz .