The correct statement is that a legal arrangement where two or more people share ownership of a business is called a partnership. So, the correct option is C.
A partnership may be started by two individuals with an intention to share the profits and losses of such business in a predetermined proportion.
<h3>Partnership Firm </h3>
A partnership firm is a form of business organization where at least two individuals put their resources and carry a legal business.
The individuals of a partnership firm are collectively known as partners, where they tend to share the profits and losses proportionately to their capital invested.
There exists vicarious liability among the partners, which means that all the partners are liable for the acts of one or more partner as per the legal contract.
A partnership firm may be terminated by lapse of time, dispute between the partners, dissolution, insolvency, but has a perpetual succession.
Hence, the correct option is C that legal arrangement where two or more people share ownership of a business is called a <u>partnership. </u>
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