BUISENESS MANAGEMENT
MARKETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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they are responsible for all of their debts
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they are working with a number of other people
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they cannot get finance from a bank
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they work on their own
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Detailed explanation-1: -Unlimited liability refers to the full legal responsibility that business owners and partners assume for all business debts. This liability is not capped, and obligations can be paid through the seizure and sale of owners’ personal assets, which is different than the popular limited liability business structure.
Detailed explanation-2: -Unincorporated businesses such as sole traders have unlimited liability. In other words, the individual who has started the business will be personally liable for business debts until they choose to incorporate.
Detailed explanation-3: -Unlimited liability means that the business owners are personally liable for any loss the business makes. Sole traders and partnerships often have unlimited liability.
Detailed explanation-4: -In the sole proprietorship business, the sole owner has unlimited liability. In this case, the owner is himself liable to pay all the liabilities.
Detailed explanation-5: -Two types of business organizations have unlimited liability: sole proprietorships and general partnerships.