ENTREPRENEURSHIP AND THE GLOBAL ECONOMY
GLOBALIZATION AND ENTREPRENEURSHIP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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To protect innocent partners from the malpractice of another partner
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So each partner can practice a specialized area of law
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To take advantage of the benefits of an unlimited life span
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So that disagreements that often occur in general partnerships can be eliminated
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Detailed explanation-1: -The members of LLP have limited liability, meaning they do not have an unlimited personal responsibility to cover the losses or liabilities of the business. LLP is designed to protect innocent partners against claims resulting from negligence and malpractice of other partners. So, the correct option is C.
Detailed explanation-2: -Some advantages of partnership over private limited company include ease of establishment and lower costs. A partnership consists of two or more individuals who own a business together and share all its profits and losses, as well as the right to manage and make decisions on behalf of the business.
Detailed explanation-3: -Protection-wise, LLCs protect members from personal liability for debts or claims on the business. With an LLP, a partner is not liable for another partner’s mistakes.
Detailed explanation-4: -The biggest advantage of choosing the LLLP structure is the limited liability protection offered for the general partner. Any lawsuits brought against the company or misconduct by the other general partners are not brought against the general partner, as they are shielded from personal liability.
Detailed explanation-5: -Liability of partners shall be limited except in case of unauthorized acts, fraud and negligence. But a partner shall not be personally liable for the wrongful acts or omission of any other partner.