What characterizes a general partnership?

A general partnership is characterized by the involvement of two or more individuals who come together to conduct business with the intention of sharing profits and losses. The fundamental aspect that distinguishes a general partnership is that it requires at least two partners who agree to work collaboratively in managing the business. Each partner in a general partnership typically has equal decision-making authority and is collectively responsible for the debts and obligations of the partnership.

In contrast, ownership being limited to one person describes a sole proprietorship, which is a distinct business structure. Operating for non-profit purposes would not accurately describe a general partnership, as partnerships are usually formed to make a profit. Additionally, stating that partners have no decision-making authority runs contrary to the nature of a partnership, where all partners are generally involved in the management and decision-making processes of the business. Thus, the defining characteristic is indeed that a general partnership is formed by two or more persons who share in the responsibilities and rewards of the business venture.