Which of the Following Is a Reason to Use a Partnership

question 33

Multiple Choice

Which of the following is a reason to use a partnership as the legal form of a business?

• A)Partnerships avoid the issue of mutual agency.
• B)Partnerships avoid the issue of unlimited liability.
• C)Partnerships avoid the issue of double-taxation faced by corporations.
• D)Partnerships avoid the difficulty of raising capital.

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Definitions:

Business-Format Franchising

A franchising arrangement where the franchisor provides the franchisee with a comprehensive system for managing the business, including brand, operational procedures, and ongoing support.

Bakery Franchise

A business system where individuals or entities purchase the rights to open and operate a bakery store under a larger company's brand and operational model.

Exclusive Territory Rights

The privilege granted to an entity allowing it to operate or sell within a specific geographic area without competition.

Overlapped Franchise Areas

Regions where the territories or markets of two or more franchise operations intersect or coincide, potentially leading to competition between them.