1.What advantages does a sole proprietorship offer? What is a major drawback of this type of organization? 2.What form of partnership allows some investors to limit their liability? Briefly explain. 3.Why is profit maximization, by itself, an inappropriate goal in business? What is meant by the goal of maximization of shareholder wealth? 4.In terms of the life of the securities offered, what is the difference between money and capital markets? Chapter 2 5.Identify the three basic types of financial statements and explain how the measurements of each are interrelated. 6.What is the price-earnings (P/E) ratio? Identify and explain three factors that affect the P/E ratio. Chapter 3 7.Financial ratios show us how successful a firm is and how well it is operating. List the four main categories of ratio analysis and describe what each category measures. Then put each of the 13