Carlita Retires from Mortex Associates,a Partnership

question 14

Multiple Choice

Carlita retires from Mortex Associates,a partnership.The business is continued by the remaining partners.What is Carlita's liability on debts incurred while she was a partner?

• A)Carlita has liability to the extent of her capital contribution.
• B)Carlita is fully liable.
• C)Carlita has no liability.
• D)Carlita has liability to the extent of partnership assets at the time of dissociation.

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Definitions:

Social Welfare

A holistic measure of the well-being and quality of life of individuals and groups within a society.

Rights To Pollute

Permits or allowances that grant entities the authorization to emit certain amounts of pollutants, often used in regulatory systems to control environmental damage.

Coase Theorem

The Coase Theorem postulates that if property rights are well-defined and transaction costs are low, parties will negotiate privately to correct externalities and allocate resources efficiently.

Externalities

Externalities are unintended side effects of economic activity affecting third parties not directly involved in the transaction, which can be either positive or negative.