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Which of the Following Are Disadvantages of a Partnership

question 44

Multiple Choice

Which of the following are disadvantages of a partnership?
I.limited life of the firm
II.personal liability for firm debt
III.greater ability to raise capital than a sole proprietorship
IV.lack of ability to transfer partnership interest


Definitions:

Negative Profits

Refers to a financial loss where expenses exceed revenues within a specific period.

Perfectly Competitive Industries

Industries in which many firms produce identical products, and entry and exit are easy, leading to zero economic profit in the long run.

Homogeneous Product

A product that is considered identical or equivalent by consumers, with no significant differences from other products in the market.

Free Exit

The condition in a market where firms can leave the industry without incurring high costs, facilitating competition and economic efficiency.

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