Which term describes a legal arrangement in which two or more people share ownership?

• A. Sole Proprietorship
• B. Partnership
• C. Corporation
• D. Franchise

Answer: (B)

Sharing ownership with two or more people describes a partnership. In a partnership, owners (partners) jointly own the business and typically share profits and losses, and usually participate in managing the company. There are variations, such as general partnerships where partners have equal management rights and personal liability for debts, and limited partnerships where some partners contribute capital but don’t manage and have limited liability. This differs from a sole proprietorship (one owner), a corporation (a separate legal entity owned by shareholders), and a franchise (a licensing arrangement to operate a business using another brand and system rather than shared ownership).