Which of the Following Is True Regarding Whether the Interest

question 49

Multiple Choice

Which of the following is true regarding whether the interest of a limited partner in a limited partnership is considered a security?

• A) Such an interest is considered a security only if the limited partnership involves an investment in real estate.
• B) Such an interest is not considered a security because a partnership,not an investment scheme,is involved.
• C) Such an interest is rarely considered a security because limited partners,to protect their limited liability,are prohibited by law from taking part in the control of the partnership business.
• D) Such an interest is almost always considered a security because limited partners,to protect their limited liability,are prohibited by law from taking part in the control of the partnership business.

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Definitions:

Future Value

The value of an investment or cash flow at a specified future date based on a certain interest rate.

Constant Dollar

An accounting method that adjusts financial statements for inflation, thereby allowing comparison of buying power across different periods.

Inflation

The rate at which the general level of prices for goods and services is rising, subsequently eroding purchasing power.

Initial Withdrawal

The first amount of money taken out from an investment or retirement account.