Q1: The current and quick ratios both help us measure a firm's liquidity. The current ratio measures the relationship of the firm's current assets to its current liabilities, while the quick ratio measures the firm's ability to pay off short-term obligations without relying on the sale of inventories. a. True b. False Q2: In general, if investors regard a company as being relatively risky and/or having relatively poor growth prospects, then it will have relatively high P/E and M/B ratios. a. True b. False Q3: Which of the following individuals have unlimited liability based on their ownership interest? 1. General partner II. Sole proprietor III. Stockholder IV. Limited partner A. I and II only B. II and IV only. C. I, II, and III only. D. I, II, and IV only. 04: It is generally harder to transfer one's ownership interest in a partnership than in a corporation. a. True b. False Q5: Diversification will normally reduce the riskiness of a portfolio of stocks. a. True b. False