Question

decision point: structuring your business
apparently, good news travels fast! you receive a call from larry, a former coworker at the sandwich shop where you worked in college. he has heard that youre thinking about opening a sandwich shop and expresses interest in joining you in your entrepreneurial venture.
larry is willing to invest a significant amount of money in the business, but he has no desire to participate in the day - to - day operations of the business. if you choose to go into business with him, which form of non - corporate business ownership would be best suited for the business?
select an option from the choices below and click submit.
cooperative
general partnership
sole proprietorship
limited partnership

Explanation:

• A cooperative is owned and controlled by its members (e.g., customers, workers). Larry's role isn't in line with this model as he just wants to invest.
• A general partnership requires all partners to be involved in management. Larry doesn't want to participate in day - to - day operations, so this is not suitable.
• A sole proprietorship has only one owner. Since Larry is investing, this option is invalid.
• A limited partnership has general partners (who manage the business) and limited partners (who invest but don't manage). This fits as you can be the general partner (managing) and Larry as the limited partner (investing only).

Answer:

Limited partnership