An Investor Has $50,000 to Invest as a Limited Partner

question 2

Multiple Choice

An investor has $50,000 to invest as a limited partner in a partnership.The individual will be one of several limited partners in the business.The business is not expected to make a profit for at least three years.Why has the investor most likely chosen to invest in this business?

• A)The investor will be guaranteed to receive the $50,000 back if the venture fails.
• B)The flow-through of losses is an important tax consideration for the investor.
• C)The investor plans to use their management expertise in the business in order to generate profits.
• D)The investor will be able to claim losses in excess of the $50,000 investment.

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