A partnership that has two classes of partners, general and limited, where the limited partners have no personal liability beyond the amounts they invest in the partnership, and no active role in the partnership, except as specified in the partnership agreement is a:
A) Limited liability company.
B) Limited partnership.
C) Mutual agency partnership.
D) Limited liability partnership.
E) General partnership.

Question

Quizplus · Accepted Answer

The characteristics described in the question are those of a limited partnership, where there are general partners who have unlimited personal liability for the partnership's debts and obligations, and limited partners who have no personal liability beyond their investment and passive role in the partnership. The partnership agreement specifies the rights and responsibilities of each type of partner.

A Partnership That Has Two Classes of Partners, General and Limited