Which of the following business types has unlimited liability?

Unlimited liability refers to a situation where the owners of a business are personally responsible for the debts and obligations of that business. In a partnership, all partners can be held liable for the entire amount of the business's debts. This means that if the partnership is unable to pay its obligations, creditors can pursue the personal assets of any partner to settle the debts.

In contrast, public companies and corporations typically benefit from limited liability, which protects the personal assets of their owners (shareholders) from being used to pay the company’s debts. In a public company, shareholders are only liable to the extent of their investment in the company’s shares. Similarly, nonprofit organizations have a corporate structure that generally protects individuals involved from personal liability for the organization's debts.

This distinction makes partnerships distinct in that the personal financial security of the partners is at risk, which is a key aspect of how they operate. This understanding is essential for managing risks and considering the implications of business ownership structures.