If business owners in a partnership wish to limit liability, they have the option to ______.
A) pledge funds
B) divide into sole proprietorships
C) set up a limited partnership
D) withhold funds

Question

Quizplus · Accepted Answer

Setting up a limited partnership allows business owners to limit their liability by designating one partner as a general partner who has unlimited personal liability, and designating other partners as limited partners with liability limited to their investments in the company. Pledging funds or withholding funds do not limit liability, and dividing into sole proprietorships eliminates the benefits of a partnership.

If Business Owners in a Partnership Wish to Limit Liability