Because of unlimited liability, it is easy for sole proprietors to borrow large sums of money.

Question

Quizplus · Accepted Answer

Unlimited liability means that the sole proprietor is personally responsible for all debts and obligations of the business, including if the business cannot repay a large loan. This makes it more risky for lenders to provide large sums of money, as they may not be able to recover the full amount in case of default. Therefore, it is not easy for sole proprietors to borrow large sums of money.

Because of Unlimited Liability, It Is Easy for Sole Proprietors