Question

The growth of both sole proprietorships and partnerships is frequently limited by their:

a) Double taxation: True/ False
b) Bylaws: True/ False
c) Inability to raise cash: True/ False
d) Limited liability: True/ False
e) Organizational articles: True/ False

Answer 1

The growth of both sole proprietorships and partnerships is frequently limited by their inability to raise cash and their limited liability.

Step-by-step explanation:

The correct answer is:

• a) Double taxation: False
• b) Bylaws: False
• c) Inability to raise cash: True
• d) Limited liability: True
• e) Organizational articles: False

The growth of both sole proprietorships and partnerships is frequently limited by their inability to raise cash and their limited liability. Sole proprietorships and partnerships may struggle to secure funds for growth or expansion, as they typically rely on personal savings or loans. Additionally, the owners of these business types have unlimited personal liability for the debts and obligations of the business, which can be a barrier to growth and risk-taking.