California Real Estate Practice Exam

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A, B, and C pool their income to buy a multi family house as an investment. This arrangement is probably a

  1. Limited partnership

  2. Corporation

  3. General partnership

  4. Joint venture

The correct answer is: General partnership

This is likely a General partnership because the three partners are combining their resources to buy and manage a property together. A limited partnership would have a combination of general and limited partners, where the limited partners have less control over the management of the business. A corporation would involve the partners incorporating their business, making it a separate legal entity. A joint venture is typically a short-term partnership for a specific project or venture, while a multi family house is a long-term investment. Therefore, a general partnership is the most suitable option in this scenario.

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