Which term best describes a partnership where one or more partners do not participate in daily management?

In the context of business organization, a partnership where one or more partners do not participate in daily management is referred to as a Limited Partnership. In this structure, there are generally two types of partners: general partners and limited partners. General partners are involved in the management of the business and assume full liability for the debts and obligations of the partnership. In contrast, limited partners typically invest capital into the business but do not engage in day-to-day operations. Their liability is confined to the amount of their investment in the partnership. This arrangement allows limited partners to have a stake in the business without the risks associated with active management.

The other options define different business structures. A general partnership involves all partners participating in management and sharing unlimited liability. A sole proprietorship is a business owned and managed by a single individual, not involving partnerships. A corporation is a distinct legal entity that operates independently of its owners, providing limited liability protection to its shareholders but doesn't fit the description of a partnership.