Question

what is the concept of limited liability?
a the owners are solely responsible for the obligations of their businesses
b the business entity itself is separated from their owners and the owners cannot be personally liable for the businesses debt
c limited liability means the business owners have partial liability for the companys debts
d limited liability indicates the business is exempt from financial obligations and debts

Explanation:

Limited liability centers on the legal separation of a business entity from its owners. This means owners' personal assets are not at risk to cover business debts beyond their investment. Option A describes unlimited liability. Option C incorrectly states "partial liability" rather than the clear separation of personal and business liability. Option D is wrong as the business is still responsible for its own financial obligations.

Answer:

B. The business entity itself is separated from their owners and the owners cannot be personally liable for the businesses’ debt