A business partner who provides capital but abstains from participation in administration of a firm is a

Assessment: JAMB UTME - Commerce - 2013 Subject: Commerce

Question 1 Report

A business partner who provides capital but abstains from participation in administration of a firm is a
Answer Details
A business partner who provides capital but does not participate in the management or administration of the firm is called a dormant partner. This means that the partner is silent and does not take an active role in the day-to-day operations of the business. The dormant partner is also known as a sleeping partner or a silent partner. Unlike a general partner, a dormant partner does not have a say in the decision-making process of the business. They are simply investors who contribute capital to the company in exchange for a share of the profits. The dormant partner is not liable for the debts or obligations of the business, but they also do not have any control over the company's actions. Overall, a dormant partner is an investor who provides financial support to a business, but does not participate in its management or administration.

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