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Aristotle believes that happiness is the ultimate goal in life.  You cant reach happiness unless you work hard and become successful.  That is where virtue comes into play.  A humans function is to engage in an activity of the soul which is in accordance with virtue and which is in conformity with reason (page 76, Palmer).  The two kinds of virtue are intellectual and moral.  Our virtues are what make us all individual and all different.  Intellectual virtues are what we are born with and what we learn.  It is our nature as humans and what we have inherited that makes desire to learn.  As humans, we develop wisdom to help guide us to a good life.  With the intellectual virtue you develop two different kinds of wisdom: practical and philosophical.  Practical wisdom is your rational actions. The highest virtue is philosophical wisdom, which is scientific, disinterested, and contemplative. Moral virtues are what we learn from imitation, practice and our habits we developed.  Moral virtues are what we have learned from our society.  Neither by nature, then, nor contrary to nature do the virtues arise in us; rather we are adapted by nature to receive them, and are made perfect by habit (page 223, Mayfield).  This quote is explaining how you need both the intellectual virtue (nature) and the moral virtue (habit).
The soul is made up of three things: passions, faculties, and states of character.  Since virtue is in our soul one of the three must be it.  Passions are uncontrolled feelings such as appetite, anger, fear, confidence, and hatred.  With virtue you have to be praised or blamed and with your passions you cant be.  We are born with faculties like we are with passions.  We are not made up of good or bad nature; we are not praised nor blamed(page 225, Mayfield).  This quote is explaining with passions and faculties are how we feel and desire which is neither right nor wrong, good or bad.  Since passions and faculties are not defined, state of character is virtue.  State of character is our actions and our habits.  The virtue of man also will be the state of character which makes a man good and which makes him do his own work well (page 225, Mayfield).  In order to have true virtue you need to act to accordance with a golden mean of moderation (page 78, Palmer).  This means that you need to find an intermediate so you will be praised and succeed.  You cant take too much or too little.  Too much for someone could be too little for someone else, therefore each person needs to find their own individual mean.
For we may be said to desire all things as means to something else except indeed happiness, as happiness is the end or perfect state (page 230, Mayfield).  As Aristotle said that our ultimate goal is happiness but in order to reach happiness you have to succeed.  Relaxation then is not an end.  We enjoy it as a means to activity; but it seems that the happy life is a life of virtue, and such a life is serious, it is not one of mere amusement.  We speak of serious things too as better than things which are ridiculous and amusing, and of the activity of the better part of mans being or of the better man as always the more virtuous (page 230, Mayfield).
As an individual your goal is happiness and as a species their goal is to make the citizens happy.  As happiness is the function or goal of the human individual, so is it the function of the state.  [.]  The state is a natural human organization whose goal is to maximize happiness for its citizens  (page 79, Palmer).  The law comes natural to humans, which makes humans work in harmony.  As human we have social instincts.  Just as humans are naturally social, so is their desire to participate in the political body an innate disposition  (page 79, Palmer).  As an individual you have your own state of character.  Some people think that men are made good by nature, others by habit, others again by teaching  (page 233, Mayfield).  This quote explains how everyone is an individual