How is a partnership defined in a business context?

A partnership in a business context is defined as a group of individuals who come together to share both the profits and responsibilities of the business. This collaborative structure allows partners to pool resources, skills, and expertise, which can enhance the business's potential for success. In a partnership, each partner typically plays an active role in the management of the business and is personally liable for its debts, promoting a sense of shared commitment and accountability. This cooperative approach is distinct from other business structures, such as sole proprietorships or corporations, where ownership and liability are organized differently.

The other options do not correctly capture the essence of a partnership: a sole trader refers to a business owned by one individual, which contradicts the collective nature of a partnership; describing a partnership as a network of freelancers misses the aspect of shared profits and responsibilities; and defining it as a type of sole trader is misleading because partnerships involve multiple individuals rather than a single owner.