Which of the Following Is a Disadvantage of a General

question 71

Multiple Choice

Which of the following is a disadvantage of a general partnership?

• A) The control of a partnership is skewed in favor of the partner who invests most capital.
• B) Partnerships do not have perpetual existence.
• C) Both a partnership and its individual partners are taxed separately.
• D) The partnership agreement does not allow partners to leave the business.

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Definitions:

Portfolio

A portfolio represents a collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including mutual funds and ETFs.

Promissory Note

A financial instrument that contains a written promise by one party to pay another party a definite sum of money either on demand or at a specified future date.

Compounded Semiannually

Interest calculation method where interest is added to the principal on a semiannual basis, leading to interest on interest in the second half of the year.

Quarterly Compounded

Interest calculation method where the accrued interest is added to the principal balance four times a year, allowing interest to be earned on interest.