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What is a trust in the context of property ownership?

  1. Transfer of property to the state

  2. Legal arrangement for a trustee to manage property for a beneficiary

  3. Selling property to a trustor

  4. A form of joint tenancy

The correct answer is: Legal arrangement for a trustee to manage property for a beneficiary

A trust is a legal arrangement in which one party, the trustee, holds and manages property on behalf of another party, the beneficiary. This allows for the trustee to manage the property for the ultimate benefit of the beneficiary, while also allowing for flexibility in how the property is used and distributed. Option A is incorrect because transferring property to the state is not the definition of a trust and is not a commonly used method of property ownership. Option C is also incorrect because selling property to a trustor would not involve a third party to manage the property, which is a key element of a trust. Option D is incorrect because joint tenancy involves co-ownership of property, not a trustee-beneficiary arrangement.