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Question

The concept of _____ restricts the amount of money a person risks to what he invests in a business enterprise.

A
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B
Unlimited liability
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C
Separate legal existence
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D
Limited liability
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Solution

The correct option is D Limited liability
The concept of limited liability restricts the amount of money a person risks to what she invests in a business enterprise. It means that the liability of each person is limited to the extent of his/her share in the business. Limited liability in simple terms, means that 'you risk what you put in'.

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