What distinguishes a general partnership from a limited partnership?

In a general partnership, all partners share equal responsibility for managing the business and have unlimited personal liability for the debts and obligations of the partnership. This means that each partner can participate actively in the management and decision-making processes of the business.

In contrast, a limited partnership has both general partners and limited partners. General partners manage the business and bear full liability, while limited partners contribute capital and typically have their liability limited to the extent of their investment. They usually do not participate in day-to-day management. Thus, business management is a distinguishing factor between the two types of partnerships, highlighting the active role of general partners in the operation of the business.

This understanding clarifies why the option stating that only general partners manage the business is the distinguishing factor between a general partnership and a limited partnership.