UGC NET Questions (Paper – 1)

Statements A, C and D express standard partnership principles. A is correct because profit shares are proportional to capital multiplied by duration of investment. C correctly defines a sleeping partner’s role. D is true as reducing capital during the year reduces the effective capital–time product. B is false since equal capital and time lead to a 1:1 ratio, and E is false because time is crucial when investments are made for different periods. Hence, A, C and D only are correct.

Option A:
Option A is correct because it combines the basic rule of capital–time proportionality with the concept of sleeping partners and the effect of withdrawing capital, while excluding B and E, which misstate profit ratios and the role of time.

Option B:
Option B is incorrect because it includes B, which incorrectly fixes the profit share at 1:2 even when capital and time are equal, thus contradicting the proportional rule.

Option C:
Option C is wrong as it also includes E, wrongly claiming that time is irrelevant in partnership problems, and therefore mixes incorrect statements with correct ones.

Option D:
Option D is incomplete since it omits A and includes only C and D, failing to explicitly state the capital–time proportionality on which partnership questions are based.