SHRM-CP Exam Dumps | In which business structure do partners exist mainly as investors, without much influence on daily operations?

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Question 138

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Question 138/153

In which business structure do partners exist mainly as investors, without much influence on daily operations?

A. limited liability partnership

B. sole proprietorship

C. general partnership

D. joint venture

Correct Answer: A

Explanation: In a limited liability partnership, partners exist mainly as investors, without much influence on daily operations. This arrangement, which is also known simply as a limited partnership, is typical of professional businesses, like legal or accounting firms. A sole proprietorship is initiated and operated by a single person. This person is entitled to all of the profits, but is liable for all business activities. In a general partnership, the business operates according to a preset agreement, and liability is shared by a group of partners. The joint venture is a form of general partnership created for a particular purpose or a restricted amount of time.

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