SIE practice questioneasyDPPs — Limited Partnerships
In a limited partnership, the limited partners' liability is:
- AThe same as the general partner's liability
- BUnlimited — they can lose more than their investment
- CGuaranteed by the general partner to be zero
- DLimited to their investment in the partnership✓ Correct answer
Explanation
Why D — Limited to their investment in the partnership
Limited partners' liability is limited to the amount they have invested in the partnership. They cannot lose more than their investment, nor can their personal assets be at risk for partnership debts. The GENERAL partner has unlimited liability. If a limited partner participates in management, they risk losing their limited liability status.
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