Which of the Following Is a Disadvantage of a Partnership

question 20

Multiple Choice

Which of the following is a disadvantage of a partnership when compared to a corporation?

• A) The partnership is more likely to have a net loss.
• B) The partnership is easier to organize.
• C) The partnership is less expensive to organize.
• D) The partnership has limited life.

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Definitions:

Voluntary

An action or decision made by an individual's own will without coercion or undue influence from others.

Secured Interest

A legal claim or lien on collateral pledged by a borrower to secure a loan, providing the lender with rights to the property if the borrower defaults.

Personal Property

Movable property that is not fixed to one location and can be owned by an individual, as opposed to real property or real estate.

Mutual-Benefit Bailment

A contractual agreement where both the bailor and bailee receive benefits from the arrangement of temporarily transferring personal property.