Solution 12.1

A sole trader is an individual sets who sets up in business and starts to trade in his or her own name. The individual is the sole owner of the business.   

A partnership can be described as an association of persons carrying on business in common with a view to making a profit.  

A private limited company is a corporate body, which has a legal existence quite separate from the owners (between two and fifty shareholders) that have restrictions on the transfer of their share, but are protected by limited liability. 

A public limited company is a corporate body, which has a legal existence quite separate from the owners (minimum of seven shareholders) that are protected by limited liability.  Shares are freely transferable as they can be traded publicly and are quoted on a stock exchange.