In a limited partnership, the liability of a limited partner is normally restricted to the amount:
Correct answer: B. Invested in the firm
- A. Withdrawn from the firm
- B. Invested in the firm
- C. Earned as profit
- D. Approved by the court
Explanation
A limited partner usually risks only the capital contributed to the partnership. This protection may be affected if the partner takes part in management where the law restricts such conduct.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Nature and Forms of Business Organisation
Business organisation combines people, capital, materials and entrepreneurship to produce goods or services and earn profit, while also meeting customer and social needs. Coverage includes sole proprietorships, partnerships, companies and cooperatives, with comparisons of ownership, liability, control, profit sharing, continuity and legal status.
Practise Nature and Forms of Business Organisation
30 free Nature and Forms of Business Organisation MCQs from Introduction to Business, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Introduction to Business questions like this
Introduction to Business is on this paper prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for it.
More Nature and Forms of Business Organisation questions
A partnership with no fixed period and no specific undertaking is generally known as a:
A partner who contributes capital but does not take an active part in managing the business is commonly called a:
Which factor most directly influences the choice between a partnership and a company?
The capital of a joint stock company is ordinarily divided into:
The document that normally states a company’s objects and the scope of its powers is the:
The principle of one member, one vote is most closely associated with a: