John and Jane want to start a pizza business but do not have enough capital. Ped

Question

John and Jane want to start a pizza business but do not have enough capital. Pedro, a wealthy entrepreneur is willing to invest in their business. The three of them form a limited partnership with John and Jane as general partners and Pedro as a limited partner. While making a pizza delivery, one of their drivers causes an automobile accident in which the other party is injured. The injured person sues the business rather than the driver. Which, if any, partners would have personal assets at risk and why?

Explanation / Answer

John and Jane would have their personal assets at risk because they are general partners whereas Pedro would be protected.

Related Questions

Navigate

• Browse (All)
• Browse J
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.