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What is a disadvantage of a general partnership?

Practice Questions

Q1
What is a disadvantage of a general partnership?
  1. Limited liability for partners
  2. Shared decision-making
  3. Potential for conflicts between partners
  4. Easier access to capital

Questions & Step-by-Step Solutions

What is a disadvantage of a general partnership?
  • Step 1: Understand what a general partnership is. It is a business structure where two or more people share ownership and management.
  • Step 2: Recognize that in a general partnership, all partners are involved in making decisions for the business.
  • Step 3: Consider that when multiple people make decisions, they may have different opinions or ideas.
  • Step 4: Realize that these differing opinions can lead to disagreements or conflicts between partners.
  • Step 5: Conclude that these conflicts can be a disadvantage because they may disrupt the business operations.
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