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:

Pareto Efficient

A situation where it is impossible to reallocate resources to make one individual better off without making at least one other individual worse off.

Aggregate Profits

The total profit earned by all firms in the economy over a specific period.

Better Off

A state or condition in which an individual or group is in a more favorable or advantageous position than before.

Pure Exchange Economy

An economic model where agents trade existing goods with no production, focusing solely on the allocation of resources and goods among market participants.