Multiple Choice QuestionWhat is a disadvantage of the partnership form of business?Multiple choice question.Friction between general and limited partnersVast amount of regulatory controlsPerpetual life of the partnershipEqual division of profits
Question
Multiple Choice QuestionWhat is a disadvantage of the partnership form of business?Multiple choice question.Friction between general and limited partnersVast amount of regulatory controlsPerpetual life of the partnershipEqual division of profits
Solution
The disadvantage of the partnership form of business is "Friction between general and limited partners". This is because in a partnership, decisions are shared. When partners don't agree on business decisions, it can lead to conflicts. Other options are not typically considered disadvantages. For instance, partnerships usually face fewer regulatory controls compared to corporations, they do not have a perpetual life as they end with the death or withdrawal of a partner, and profits are not necessarily divided equally, but rather based on the terms of the partnership agreement.
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