Which of the Following Is True of the Liability to Creditors

question 27

Multiple Choice

Which of the following is true of the liability to creditors in the process of continuation of partnership beyond an agreed-on term?

• A) Withdrawing partners are liable for new obligations though they have given a notice of withdrawal.
• B) New partners are liable for prior obligations only to extent of contribution unless they agree to greater liability.
• C) Continuing partners are the only people liable for prior obligations.
• D) Withdrawing partners are liable for prior obligations even though they are released by novation.

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Definitions:

Fixed Proportions

A production process where inputs are used in strict, unchangeable ratios, without the flexibility to substitute one input for another.

Elasticity Coefficient

A numerical measure of the responsiveness of quantity demanded or supplied to one of its determinants, such as price or income.

Resource Demand

The requirement for resources or inputs necessary for production in response to market needs.

Infinitely Elastic

A situation in which the quantity demanded or supplied changes by an unlimited amount in response to any change in prices.