Question

Select the most appropriate alternative from those given below and rewrite the statement.

A partner who lends only his name to the firm is called as__________________ partner.

Options

• partner in profits only

• partner by estoppel

• nominal

• minor.

Answer 1

A partner who lends only his name to the firm is called as nominal partner.

Explanation: A partner who merely lends his name to the firm is regarded as a nominal partner. He neither invests in the business nor takes active part in it. But he is important for building up a good reputation for the firm.