California Real Estate Practice Exam

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Study for the California Real Estate Exam. Engage with multiple choice questions and detailed explanations to sharpen your knowledge. Get ready to ace your real estate career!

Practice this question and more.

A limited partner’s liability in a real estate investment is

unlimited.
limited to double the amount of his investment.
the same as a general partner's liability.
limited to the amount of his investment.

The correct answer is: limited to the amount of his investment.

The correct answer is D. A limited partner's liability in a real estate investment is limited to the amount of their investment. This means that if the investment were to fail or face legal issues, the limited partner would not be responsible for any more than the initial amount they invested. Option A, unlimited liability, is more commonly associated with general partnerships. Option B, limited to double the amount of the investment, is not a common practice in real estate investment and does not accurately reflect a limited partner's liability. Option C, the same as a general partner's liability, is also incorrect because general partners have unlimited liability, while limited partners have limited liability.