Question

Two partners of a business are sued by a customer because of damages caused by the business's product. The business is forced to pay the customer $100,000 dollars, but each partner only has to pay $50,000 dollars. What is this an example of?

Shared liability

Expanded access to capital

Partner strife

Expanded input on decisions

Answer 1

This is an example of **shared liability**. In this scenario, both partners are responsible for the business's obligation to pay damages to the customer, and their individual financial responsibility is limited to a portion of the total amount owed.