History of the North American Free Trade Agreements

A free trade agreement is a pact between two countries or areas in which they both agree to lift most or all tariffs, quotas, special fees and taxes, and other barriers to trade between the entities. The purpose of free trade agreements is to allow faster and more business between the two countries/areas, which should benefit both. Why All Should Benefit from Free Trade The underlying economic theory of free trade agreements is that of comparative advantage, which originated in an 1817 book entitled On the Principles of Political Economy and Taxation by British political economist David Ricardo. Put simply, the theory of comparative advantage postulates that that in a free marketplace, each country/area will ultimately specialize in that activity where it has comparative advantage (i.e. natural resources, skilled workers, agriculture-friendly weather, etc.) The result should be that all parties to the pact will increase their income. However, as Wikipedia points out: ... the theory refers only to aggregate wealth and says nothing about the distribution of wealth. In fact there may be significant losers... The proponent of free trade can, however, retort that the gains of the gainers exceed the losses of the losers. Claims that 21st Century Free Trade Doesnt Benefit All Critics from both sides of the political aisle contend that free trade agreements often dont work effectively to benefit either the U.S. or its free trade partners. One angry complaint is that more than three million U.S. jobs with middle-class wages have been outsourced to foreign countries since 1994. The New York Times observed in 2006: Globalization is tough to sell to average people. Economists can promote the very real benefits of a robustly growing world: when they sell more overseas, American businesses can employ more people. But what sticks in our minds is the television image of the father of three laid off when his factory moves offshore. Latest News In late June 2011, the Obama administration announced that three free trade agreements,.. with south Korea, Colombia and Panama... are fully negotiated, and ready to send to Congress for review and passage. These three pacts are expected to generate $12 billion in new, annual U.S. sales. Republicans stalled approval of the agreements, though, because they want to strip a small, 50-year-old worker retraining/support program from the bills. On December 4, 2010, President Obama announced completion of renegotiations of the Bush-era U.S.-South Korea Free Trade Agreement. See Korea-U.S. Trade Agreement Addresses Liberal Concerns. The deal that weve struck includes strong protections for workers rights and environmental standards--and as a consequence, I believe its a model for future trade agreements that I will pursue, commented President Obama about the U.S.-South Korea agreement. (see Profile of U.S.-South Korea Trade Agreement.) The Obama administration is also negotiating an entirely new free trade pact, the Trans-Pacific Partnership (TPP), which includes eight nations: U.S., Australia, New Zealand, Chile, Peru, Singapore, Vietnam and Brunei. Per AFP, Nearly 100 US companies and business groups have urged Obama to conclude TPP negotiations by November 2011. WalMart and 25 other U.S. corporations have reportedly signed onto the TPP pact. Presidential Fast-Track Trade Authority In 1994, Congress let fast-track track authority to expire, to give Congress more control as President Clinton pushed the North American Free Trade Agreement. After his 2000 election, President Bush made free trade the center of his economic agenda, and sought to regain fast-track powers. The Trade Act of 2002 restored fast-track rules for five years. Using this authority, Bush sealed new free trade deals with Singapore, Australia, Chile and seven smaller countries. Congress Unhappy with Bush Trade Pacts Despite pressure from Mr. Bush, Congress refused to extend fast-track authority after it expired on July 1, 2007. Congress was unhappy with Bush trade deals for many reasons, including: Losses of millions of U.S. jobs and companies to foreign countriesExploitation of labor forces and resources and defilement of the environment in foreign countriesThe enormous trade deficit generated under President Bush International charity organization Oxfam vows to campaign to defeat trade agreements that threaten peoples rights to: livelihoods, local development, and access to medicines. History The first U.S. free trade agreement was with Israel, and took effect on September 1, 1985. The agreement, which has no expiration date, provided for the elimination of duties for goods, except for certain agricultural products, from Israel entering the U.S. The U.S.-Israeli agreement also allows American products to compete on an equal basis with European goods, which have free access to Israeli markets. The second U.S. free trade agreement, signed in January 1988 with Canada, was superceded in 1994 by the complex and controversial North American Free Trade Agreement (NAFTA) with Canada and Mexico, signed with much fanfare by President Bill Clinton on September 14, 1993. Active Free Trade Agreements For a complete listing of all international trade pacts to which the U.S. is a party, see the United States Trade Representives listing of global, regional and bilateral trade agreements. For a listing of all worldwide free trade pacts, see Wikipedias List of Free Trade Agreements. Pros Proponents support U.S. free trade agreements because they believe that: Free trade increases sales and profits for U.S. businesses, thus strenghtening the economyFree trade creates U.S. middle-class jobs over the longtermFree trade is an opportunity for the U.S. to provide financial help to some of the worlds poorest countries Free Trade Increases U.S. Sales and Profits Removal of costly and delaying trade barriers, such as tariffs, quotas and conditions, inherently leads to easier and swifter trade of consumer goods. The result is an increased volume of U.S. sales. Also, use of less expensive materials and labor acquired through free trade leads to a lower cost to manufacture goods. The result is either increased profit margins (when sales prices are not lowered), or increased sales caused by lower selling prices. The  Peterson Institute for International Economics estimates  that ending all trade barriers would increase U.S. income by a whopping $500 billion annually. Free Trade Creates U.S. Middle-Class Jobs The theory is that as U.S. businesses grow from greatly increased sales and profits, demand will grow for middle-class higher-wage jobs to facilitate the sales increases. In February, the  Democratic Leadership Council, a centrist, pro-business think-tank headed by Clinton ally former Rep. Harold Ford, Jr., wrote: Expanded trade was undeniably a key part of the high-growth, low-inflation, high-wage economic expansion of the 1990s; even now it plays a key role in keeping inflation and unemployment at historically impressive levels. The  New York Times wrote  in 2006: Economists can promote the very real benefits of a robustly growing world: when they sell more overseas, American businesses can employ more people. U.S. Free Trade Helps Poorer Countries U.S. free trade benefits poorer, non-industrialized nations through increased purchases of their materials and labor services by the U.S. The  Congressional Budget Office explained: ... economic benefits from international trade arise from the fact that countries are not all the same in their production capabilities. They vary from one another because of differences in natural resources, levels of education of their workforces, technical knowledge, and so on. Without trade, each country must make everything it needs, including things it is not very efficient at producing. When trade is allowed, by contrast, each country can concentrate its efforts on what it does best... Cons Opponents of U.S. free trade agreements believe that: Free trade has caused more U.S. jobs losses than gains, especially for higher-wage jobs.Many free trade agreements are bad deals for the U.S. Free Trade Has Caused U.S. Jobs Losses A  Washington Post columnist wrote: While corporate profits soar, individual wages stagnate, held at least partly in check by the brave new fact of offshoring -- that millions of Americans jobs can be performed at a fraction of the cost in developing nations near and far. In his 2006 book Take This Job and Ship It, Sen. Byron Dorgan (D-ND) decries, ... in this new global economy, no one is more profoundly affected than American workers... in the last five years, weve lost over 3 million U.S. jobs that have been oursourced to other countries, and millions more are poised to leave. NAFTA: Unfilled Promises and a Giant Sucking Sound When he signed NAFTA on September 14, 1993,  President Bill Clinton exulted, I believe that NAFTA will create a million jobs in the first five years of its impact. And I believe that that is many more than will be lost... But industrialist H. Ross Perot famously predicted a giant sucking sound of U.S. jobs heading to Mexico if NAFTA was approved. Mr. Perot was correct.  Reports the Economic Policy Institute: Since the North American Free Trade Agreement (NAFTA) was signed in 1993, the rise in the U.S. trade deficit with Canada and Mexico through 2002 has caused the displacement of production that supported 879,280 U.S. jobs. Most of those lost jobs were high-wage positions in manufacturing industries. The loss of these jobs is just the most visible tip of NAFTAs impact on the U.S. economy. In fact, NAFTA has also contributed to rising income inequality, suppressed real wages for production workers, weakened workers  collective bargaining  powers and ability to organize unions, and reduced fringe benefits. Many Free Trade Agreements Are Bad Deals In June 2007, the Boston Globe reported about a pending new agreement, Last year, South Korea exported 700,000 cars to the United States while U.S. carmakers sold 6,000 in South Korea, Clinton said, attributing more than 80 percent of a $13 billion U.S. trade deficit with South Korea... And yet, the proposed new 2007 agreement with South Korea would not eliminate the barriers that severely restrict the sale of American vehicles per Sen. Hillary Clinton. Such lopsided dealings are common in  U.S. free trade agreements. Where It Stands U.S. free trade agreements have also harmed other countries, including: Workers in other countries are being exploited and harmed.The environment in other countries is being defiled. For example, the  Economic Policy Institute explains  about post-NAFTA Mexico: In Mexico, real wages have fallen sharply and there has been a steep decline in the number of people holding regular jobs in paid positions. Many workers have been shifted into subsistence-level work in the informal sector... Additionally, a flood of subsidized, low-priced corn from the U.S. has decimated farmers and rural economics. The impact on workers in countries as India, Indonesia, and China has been even more severe, with innumerable instances of starvation wages, child workers, slave-labor hours and perilous work conditions. And  Sen. Sherrod Brown  (D-OH) observes in his book Myths of Free Trade: As the Bush administration has worked overtime to weaken environmental and food safety rules in the U.S., Bush trade negotiators are trying to do the same in the global economy... The lack of international laws for environmental protection, for example, encourages firms to go to the nation with the weakest standards. As a result, some nations are conflicted in 2007 over U.S. trade deals. In late 2007, the  Los Angeles Times reported  about the pending CAFTA pact: About 100,000 Costa Ricans, some dressed as skeletons and holding banners, protested Sunday against a U.S. trade pact they said would flood the country with cheap farm goods and cause big job losses. Chanting No to the free-trade pact! and Costa Rica is not for sale! protesters including farmers and housewives filled one of San Joses main boulevards to demonstrate against the Central American Free Trade Agreement with the United States. Democrats Divided on Free Trade Agreements Democrats have coalesced in favor of trade policy reform over the past decade as President Bill Clintons NAFTA, WTO and China trade deals not only failed to deliver the promised benefits but caused real damage, said Lori Wallach of Global Trade Watch to  Nation contributing editor Christopher Hayes. But the centrist  Democratic Leadershp Council insists, While many Democrats find it tempting to Just Say No to Bush trade policies... , this would squander real opportunities to boost U.S. exports... and keep this country competitive in a global marketplace from which we cannot possibly isolate ourselves.

Doctors and Facebook Is There a Privacy Risk - 807 Words

Q1. Describe one key legal issue and one key ethical issue that concern most organizations as they seek to take full advantage of the Internet. Concerns about patient confidentiality in the age of e-medicine motivated Congress to pass the Health Insurance Portability and Accountability Act (HIPAA). Organizations must put in place safeguards to protect patient information, such as encrypting patient data that is stored online and they must reasonably limit uses and disclosures to the minimum necessary to accomplish their intended purpose (For consumers, 2012, Health information privacy). Organizations must train employees how to follow appropriate procedures to protect patient heath information and ensure that they have contracts with outside entities to limit the inappropriate use of patient data. A major goal of the Privacy Rule is to assure that individuals health information is properly protected while allowing the flow of health information needed to provide and promote high quality health care and to protect the publics health and well being (Summary of the HIPAA privacy rule, 2012, HHS). Legally, patient data must be protected by the organization. However, there is also an ethical responsibility that healthcare providers protect patient privacy in their personal online interactions. Doctors with a Facebook profile could be jeopardizing their relationship with patients if they dont correctly use the websites privacy settings, according to a study in theShow MoreRelatedThe Impact Of Technology On The Technology Field1421 Words   |  6 Pagespotentially bring in a societal context? Privacy issues are already extremely prevalent, recently Apple iCloud was hacked and hundreds of celebrity s private images were released onto the internet. 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Price discrimination in the English premier league free essay sample

Many scholars have described football as a global game or as a global language. In my opinion, football is the easiest sport to be part of in the world. Every child from different class groups is eager to play football, whether it is on the streets or on a world-class field with amazing equipment. As a child you do not see the economic side of football. You just want to play the game and it becomes a part of your livelihood. As you grow older, things get clearer in your mind and you start analyzing the impact it has in the economy. For many years, the world cup has brought jewels of wealth to the economy due to mass participation. â€Å"It gives them an opportunity to offer foreigners a window into their world and stimulate the development of football domestically. † (Szymanski, S. 2002). There is always a hope that the World Cup would bring substantial economic growth to the host nation that has generally struggled for the past decade. The 2002 World Cup in South Korea is a very good example of how economic growth can occur during and after the World Cup. In various countries, the football clubs that exist have caused a significant change of economic structure. When Roman Abramovich, Russian billionaire and major shareholder of a private investment company Millhouse LLC, took over Chelsea football club, he transformed them into one of the top teams in the world. Even with all the considerable amounts of luxury football clubs have from private owners, there is still always two sides to a coin. Football player’s wages in the premier league are enormous, even after the economic gloom and inflation gripping Britain. There has been a disproportionate raise in ticket prices of various English premiership clubs that has lead to price discrimination to the loyal and passionate fans of football. Due to the popularity of the English premier league, there has been an increasing demand of spectators. The clubs are forming a monopoly by exploiting the loyal supporters. The burden of such financial responsibility has shifted from the club’s owner to the pocket of the helpless supporters by selling higher ticket prices and clothing merchandises. The regular supporters will do anything to watch their team play every weekend, even if they have to pay a higher amount on the tickets. â€Å"The various clubs outline the importance of maximizing potential revenues by avoiding, wherever possible, the prospect of the unsold seat. The consequent dilemma facing the Premier League clubs is to ensure that the nature of pricing match tickets equates to the clubs’ financial requirements and the supporters’ overall satisfaction. †(Clowes, J. And Clem, N. 2003). Figure 3 examines the contrasting season ticket prices depending on the location of the stand. It highlights that only four clubs have â€Å"significant† price discrimination while the rest of the clubs are reasonably high. Also, figure 5 audits the variation in the price on match day tickets for various locations in the â€Å"main stand. † The graph portrays the maximum price discrimination by differentiating between â€Å"the maximum premium charged by each club based on the lowest ticket price and highest match day ticket price within the main stand. † (Clowes, J. And Clem, N. 2003). For example, Chelsea FC charges the highest price discrimination of 37 pounds in comparison to other clubs in the English premier league. â€Å"They reported that a 1% increase generated on average an 11% profit increase among the 2000 companies they studied in the premier league. †(Clowes, J. And Clem, N. 2003). â€Å"Bird found a (real) price elasticity of demand of -0. 2 and an income elasticity of -0. 6 for the period 1948 to 1975, showing that football was price-inelastic and an inferior good. † (Simmons, R. 1996). Home and away fans tend to â€Å"dominate† attendances in a football game while neutral supporters tend to be the â€Å"minorities. † The price discrimination varies due to the popularity and the success of that particular club. Fans may simply not attend due to the poor performances in the league and other domestic tournaments (FA cup, carling cup, etc. ). One of the biggest reasons for price discrimination is the high wages paid to many English premier league players. Football is a spectator’s sport and therefore, the clubs main revenue comes from the supporters and the television rights. â€Å"Much of this price increase has, perhaps, been fuelled by the price media companies have been prepared to pay to secure television rights to ensure access to this highly popular entertainment vehicle. †(Clowes, J. And Clem, N. 2003). Price discrimination has been â€Å"manifested† from the grass roots of the organizational level in the English football industry. Various clubs are willing to pay millions of pounds to secure the playing talents from other clubs in the world. In addition, it is foreseeable that the wages of these players will have to increase in order to retain their services for a longer duration or to persuade them from changing clubs. English premier league clubs must find a solution to reduce price discrimination before the loyal supporters turn their back on their team. It is vital to split the season ticket holders and the supporters who pay at the gate. This suggests that the â€Å"casual† supporters have greater price elasticity than the season ticket holders. Clubs in the premier league have different price bands on the bases of the opposition’s ability to play attractive football and also the history of the club. â€Å"The optimal pricing strategy must then weigh up the likely prospects for success, or failure, including the probability of relegation. For some clubs there is evidence of price-elastic demand from adjusted attendances and hence real price increases would lower revenue, ceteris paribus. † (Simmons, R. 1996). Tactics used by the sports organizations in the United States could be implemented in the English premier league. â€Å"Differential pricing is the core of a marketing- oriented approach to pricing professional sports. †(Howard, D. And Crompton J. 2007). Differential pricing works affectively when a market is comprised of â€Å"segment that have different demand characteristics. † It operates by charging different prices for the same service where the price differences and the cost differences are disproportional. If the clubs in the premier league charge different prices for different opponents by evaluating the opposition’s quality of football, time and place, the English premier league tickets will reduce significantly and the loyal supporters would live happily ever after.

Internship Report on Nestle free essay sample

It became Kit Kat in 1937, two years before the Second World War. Within two years of launch Kit Kat was established as Rowntrees leading product, a position that it has maintained ever since. During the Second World War Rowntree Kit Kat was seen as a valuable wartime food and advertising described the brand as What active people need. For most of its life Rowntree Kit Kat has appeared in the well-known red and white wrapper. It did, however, change to a blue wrapper in 1945, when it was produced with a plain chocolate covering due to a shortage of milk following the war. This blue packaging was withdrawn in 1947 when the standard milk chocolate Kit Kat was reintroduced. Polo and Fox candies are also well known and favorite products for refreshment. In Pakistan, Polo is now being imported from china after one year gap. Nestle Pakistan is producing Polo in china with lighter weight than before. We will write a custom essay sample on Internship Report on Nestle or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Fox candies are available in six different flavors, from which Nestle fruit Fox is the most saleable and demanding candy. Nestle means ‘little nest’ in Swiss German. Nestle first customer was a premature infant who could tolerate neither his mother’s milk nor any other conventional substitute. Thus, Henri’s ultimate goal was to help fight the problem of infant mortality due to malnutrition for which he developed a product combining various cow’s milk, wheat flour and sugar and name it Farine Lactee Nestle, which was the first product of Nestle being marketed in Europe. In 1974, Jules Monnerat purchased Nestle and collectively they launched a condensed milk product of its own. In 1905, Nestle got merged with Anglo-Swiss condensed milk. After some time, when Nestle got fully established and all its operation were properly functioning in Europe and was gaining fame around Europe, then Nestle decided to set up production plants around the globe to ensure the growth of the organization and to become multinational. The decision to set up industrial operation in new market needs a lot of research, as there are various factors that effect the growth of the organization and turns out to be a loss for the company. Such factors are as follows ? The availability of raw material ? Cost factor ? Economic climate ? Consumer purchasing power ? Consumer tastes The decision to become multinational turned fruitful for Nestle and today Nestle has its own operations and products in America, England, India, Brazil, Australia, Pakistan, Hungary, France, Belgium, Italy, Spain and various other countries around the globe. The history of Nestle includes the development of many different products as well as acquisitions, mergers and the purchasing of shares in companies, mainly abroad. Over the course of the years, this enabled it to broaden its range of products and diversify its operations, while at the same time strengthening the economic foundations of the company. Amongst the most important acquisitions were Carnation in Los Angeles (milk, culinary products and pet foods) and more recently Rowntree Mackintosh in York (chocolate and confectionery), Buitoni in Perugia (pasta) as well as Perrier in France(mineral water).

What are Juliets feeling and emotions Essay Example For Students

What are Juliets feeling and emotions? Essay What advice would you give an actor playing this part? In this passage Juliet has strong conflicting emotions. It is all showing how Juliet copes in a time of despair and how she deals with such a traumatic circumstance. It is a solo scene, and therefore I feel it shouldnt be acted with too much hysteria. But instead quite calmly. I think this would make it seem more realistic and consequently more dramatic. She begins by saying: Farewell! God knows when we shall meet again. We will write a custom essay on What are Juliets feeling and emotions? specifically for you for only $16.38 $13.9/page Order now This suggests that she is both hesitant about taking the poison and scared as to whether it will work. Because of this risk she is very afraid. For this to be acted out during the period of time it was written there wouldnt have been an actress to play Juliet. A pre-pubescent boy would play it because his voice wouldnt have broken and would be suitable to play the opposite sex. However, to modernise it to fit into life today, I would have a woman act the part. At this point in the scene, Juliet hasnt had a real chance to digest what she is about to do or think about the consequences in detail. With this in mind, I would have the actress use few facial expressions, but instead, have straight pale almost life-less look about her. In the next couple of lines she goes on to say: I have a faint cold fear thrills though my veins That almost freezes up the heat of life Juliet is starting to feel more and more terrified about the ideas, I think here the actress should start to tremble and maybe start to shed a few tears as she raises her arms to look at her veins. Ill call them back again to comfort me Nurse! What should she do here? My dismal scene I needs must act alone Come, vial In these lines Juliet seems to get more tense. Shes doubtful as to whether she is able to do this by herself and so calls for the nurse to come back. She knows thats it is her family duty to marry her parents choice Paris, and that even her faithful nurse will not be able to help her go against social necessity and tradition. Whilst acting this I think the actress should start to show Juliet is upset and nervous. This should be done by her starting to cry and, if possible, getting clammy or sweaty. When shouting Nurse! the actress shout trail off at the end to show the definite change of mind leading into determination of doing this act alone. This can be shown by the actress sniffing as a physical full stop to the tears before leaning forward to pick up the poison. The last few lines of the paragraph say: What if this mixture do not work at all? Shall I be married then tomorrow morning? No, no, this shall forbid it; lie thou there. After saying this, Juliet places a dagger by her bedside. She is prepared to kill herself rather than marrying Paris if the poison doesnt work and she were to wake in the morning. To do this shows she is obviously starting to get confused as well as terrified about the whole scheme. Juliet I think should have a slight slip in her firm attitude as she starts to worry that the scheme will fail and she will have to resort to stabbing herself. What if it be a poison which the Friar Subtly hath ministered to have me dead, Lest in this marriage he should be dishonoured, .u717d59c44249b72df7d45808a829b873 , .u717d59c44249b72df7d45808a829b873 .postImageUrl , .u717d59c44249b72df7d45808a829b873 .centered-text-area { min-height: 80px; position: relative; } .u717d59c44249b72df7d45808a829b873 , .u717d59c44249b72df7d45808a829b873:hover , .u717d59c44249b72df7d45808a829b873:visited , .u717d59c44249b72df7d45808a829b873:active { border:0!important; } .u717d59c44249b72df7d45808a829b873 .clearfix:after { content: ""; display: table; clear: both; } .u717d59c44249b72df7d45808a829b873 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .u717d59c44249b72df7d45808a829b873:active , .u717d59c44249b72df7d45808a829b873:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .u717d59c44249b72df7d45808a829b873 .centered-text-area { width: 100%; position: relative ; } .u717d59c44249b72df7d45808a829b873 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .u717d59c44249b72df7d45808a829b873 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .u717d59c44249b72df7d45808a829b873 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .u717d59c44249b72df7d45808a829b873:hover .ctaButton { background-color: #34495E!important; } .u717d59c44249b72df7d45808a829b873 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .u717d59c44249b72df7d45808a829b873 .u717d59c44249b72df7d45808a829b873-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .u717d59c44249b72df7d45808a829b873:after { content: ""; display: block; clear: both; } READ: We have looked at many different types of courtship and we have seen the different parts that convention plays in each one EssayBecause he married me before to Romeo? I fear it is, and yet methinks it should not, For he hath still been tried a holy man. This section of the passage shows that she is becoming very anxious and paranoid. She fears that even the good Father Lawrence would try and kill her to save his reputation. But she recognises that this would be improbable and her fears take another form. Being anxious, Juliet should start to pace up and down her bedroom, unable to rest. Her hand movements should start to get more dramatic as she asks herself these distressing questions. She should also start to pull at her hair in a distracted way. Juliet then reflects that even if the potion is not poisonous she may be forced to awake alone in the tomb. She is a young girl and her imagination gives her a series of harrowing possibilities. She fears she may wake and suffocate in the tomb before Romeo arrived or possibly, even wore, she may wake amongst the corpses and bones in the family vault and be driven crazy by the horrors of such surroundings. O, if I wake, shall I not be distraught, Environà ¯Ã‚ ¿Ã‚ ½d with all these hideous fears, And madly play with my forefathers joints, And pluck the mangled Tybalt from his shroud. The actress may now stop pacing up and down and sink onto her bed, clutching her arms, rocking backwards and forwards. She imagines being next to the festering body of Tybalt and being distraught enough to kill herself in madness. At this point she has worked herself to hysterical resolution, she suddenly stops this train of thought. She is still very frightened and feels helplessly naà ¯Ã‚ ¿Ã‚ ½ve to it all. The actress ceases to rock herself and takes on a calm, but slightly false attitude. Refocusing on Romeo, Juliet drinks the potion. Romeo, Romeo, Romeo! Heres drink I drink to thee.

How to Teach the Present Perfect Continuous

How to Teach the Present Perfect Continuous The present perfect continuous form is often confused with the present perfect. Indeed, there are many instances in which the present perfect continuous can be used as well as the present perfect. For example: Ive worked here for twenty years. OR Ive been working here for twenty years.Ive played tennis for twelve years. OR Ive been playing tennis for twelve years. The main emphasis in the present perfect continuous is on expressing how long the current activity has been happening. Its best to stress that the present perfect continuous form is used for shorter periods of time to express how long that particular action has been taking place. Ive been writing for thirty minutes.Shes been studying since two oclock. In this manner, youll help students understand that the present perfect continuous is used to express the length of a current action. Compare this to cumulative length for which we tend to use the present perfect, although the present perfect continuous can be used. Introducing the Present Perfect Continuous Start by Speaking about the Length of Current Actions Introduce the present perfect continuous by asking students how long theyve been studying in the current class on that day. Extend this to other activities. Its a good idea to use a magazine with photos and ask questions about how long the person in the photo has been doing a particular activity. Length of Current Activity Heres an interesting photo. Whats the person doing? How long has the person been doing XYZ?What about this one? He looks like hes getting ready for a party. I wonder if you can tell me how long hes been getting ready for the party. Result of Activity Another important use of the present perfect continuous is to explain what has been happening that has caused a present result. Stating results and asking questions are effective in teaching this use of the form. His hands are dirty! What has he been doing?Youre all wet! What have you been doing?Hes tired. Has he been studying for a long time? Practicing the Present Perfect Continuous Explaining the Present Perfect Continuous on the Board Use a timeline to illustrate the two principal uses of the present perfect continuous. With such a long string of helping verbs, the present perfect continuous can be a bit confusing. Make sure that students understand the construction by providing a structural chart like the one below: Subject have been verb(ing) objectsHe has been working for three hours.We havent been studying for long. Repeat for the negative and interrogative forms as well. Make sure students understand that the verb have is conjugated. Point out that questions are formed with How long ... for the length of an activity, and What have you ... for explanations of current results. How long have you been sitting there?.What have you been eating? Comprehension Activities Its a good idea to compare and contrast both the present perfect and present perfect continuous when first teaching this tense. At this point in their studies, students should be able to handle working with two related tenses. Use lessons that focus on the differences to help them distinguish usage. Quizzes testing present perfect or perfect continuous use also help students become familiar with the two tenses. Present perfect and continuous dialogues can also help with practicing the differences. Also, make sure to review non-continuous or stative verbs with students. Challenges With the Present Perfect Continuous The main challenge students will face with the present perfect continuous is understanding that this form is used to focus on shorter lengths of time. I find its a good idea to use a common verb such as teach to illustrate the difference. For example: Ive taught English for many years. Today, Ive been teaching for two hours. Finally, students may still have difficulties with the use of for and since as time expressions with this tense.

SPSS project Assignment Example | Topics and Well Written Essays - 2000 words

SPSS project - Assignment Example Respondents aged less than 35 years old for both male and female was 28% and 31% respectively. 55.6% of the respondents reported to be married/common law, 32.3% were single and another 12.1% were either separated, widowed or divorced. The female respondents topped the list with the highest percent (39.3%) of separated/widowed/divorced while the male respondents led in the percentage of the married/common law couples. Only 0.2% of the male respondents reported to have been divorced. At the same time, the percent of male and female single respondents was reported to be 34% and 28.5% respectively. The respondents’ income ranged from below $15,000 to over $65,000 with majority of the respondents (32.6%) being in the income bracket of $55,000-$64,999. Only 5.7% of the respondents interviewed reported to earn below $15,000. In summary, 62.8% of the respondents interviewed said to earn an annual income of $45,000 and above. The P-value for the Chi-Square test is 0.0000.05 (significance level), leading us to fail rejecting the null hypothesis. The results for this analysis therefore show that there is no association between taking Delta and the marital status of the respondent. The P-value for the Chi-Square test is 0.000

Issues in Developmental Psychology Essay Example | Topics and Well Written Essays - 750 words

Issues in Developmental Psychology - Essay Example Every person is doing one's own duty in one's own station for which one is best suited to do by Nature. There are others like John Locke who considers that a person is like a tabula rasa or a blank slate when someone is born. What is expounded here suggests that a man's personality can be molded into any desired and aspired for direction and shape through modern means of education. Empty mind, however, is the devil's workshop! Similarly, early influences on human mind have a more lasting and prolonged effect in one's life. Most of the psychologists, including Sigmund Freud, believe that experiences of an early age cause deep imprints upon the concerned human mind. Experiences are more efficacious way of shaping up of a man's than merely the classroom lessons. How and at what pace change from birth to life is taking place These changes are merely quantitative or they are qualitative as well Children at certain stage of development show more of specific skills than others. Why is it like this To grasp these aspects of human growth and development, it is necessary to go into the Freudian psycho-sexual, Erik Erickson's psycho-social, Pavlov's classical conditioning, D. F. Skinner's operant conditioning and Piaget's cognitive stages of development theories related to psychologists through different experiments and experiences. According to developmental guidel... For modern psychologists, falling behind a normal yardstick of growth may at times be due to individual differences of personality and not due to any abnormalcy on the part of the concerned person. All above mentioned issues are mutually interrelated. They are to be understood in a balanced way. Freud's psycho-analytic approach to human growth depending on psycho-sexual stages, Erickson's lifespan theory of development in stages, Pavlov's environment and mutual interaction aspect, Skinner's operant conditioning impact and Piaget's focus on development of mental processes, skills and abilities are all to be known before delving deep into the developmental psychology. Analyses and Opinion This article on "Issues in Developmental Psychology" pin points major concerns in this field. As such, the concise nature of this article maybe appreciated. Mainly four issues raised are related to apparent questions about importance of a child as a person. What is more significant - inherent nature, acquired education, social environment or learned skills -- in bringing about a change in one's personality Answers to such questions are indicated to be found in different approaches to child growth and development. This is, indeed, a thought provoking article for those who are seriously inclined to find relevant answers to problems faced by them in their routine life of dedicated teachers and parents. The main weakness of this article lies in its attempt to keep away from finding answers to highlighted issues. It seems Wagner does not want to impose her own answers upon readers and practitioners of education and knowledge. She is just putting before us a few available options. An apparent difference is

Importance of Risk Assessment Research Paper Example | Topics and Well Written Essays - 1500 words

Importance of Risk Assessment - Research Paper Example Effective risk assessment is quite crucial to the success of every organization or business activity.Risk assessment requires consistently applying and defining an approach that is tailored to the organization. Any assessment activity begins with the outlay of a plan and scope considering objectives, timing, input, output and responsibility requirements (Wenyuan 21). These responsibilities are assigned to parties that can provide a meaningful perspective on relevant risks. In implementing these responsibilities, one requires input sources which are determined by the information available such as prior assessments, lessons learned and loss data. On the other hand, output requirements are determined based on specific requirements of sponsors and stakeholders. The execution of the assessment process is done once the planning and scoping have been determined. Â  There are several important steps required in carrying out a risk assessment.The first step involves the identification of relevant organization objectives. Identifying relevant objectives provides a basis for ascertaining the potential risks that may have an impact on the achievement of certain objectives. It further ensures relevance of consequential risk assessment and management plan to important organizational objectives. These objectives are usually defined as a number of organizational levels and it is necessary to comprehend how they are formulated. (Vose 12). Moreover, well-formulated objectives are analyzed by considering the weaknesses, opportunities, threats, and strengths.

Foreign Exchange Risk Management Analysis

Foreign Exchange Risk Management Analysis Chapter 1 Introduction This chapter will introduce the reader to the subject at hand and why the chosen research area is of interest and relevance for further development. Finally, the chapter includes a problem discussion, which in turn ends up in the research purpose of the thesis. 1.1 Background of the Study The deepening of globalization process has led to an increase in foreign exchange transactions in international financial markets. This has determined a higher volatility of exchange rates, and, implicitly, an increased foreign exchange risk. There are many types of risks, but only few of them can bring losses as large as foreign exchange risk. In these conditions, the development of new modern and effective methods for managing foreign exchange risk becomes a great necessity for the players in international financial activity. Foreign exchange risk management is crucial for companies frequently trading in the international market. Empirical research shows that profits of multinational companies are affected by volatile floating foreign exchange rates. Nevertheless, small firms trading exclusively on their domestic markets also become increasingly exposed to foreign currency fluctuations. Actually, small firms depend on the volatility of the main currencies because many of them out-source their production to foreign countries. This means that they incur costs in a foreign currency (wages, taxes, material, etc.) and they also need to manage this exposure. Other small firms are exposed indirectly given that their strategic position can be affected by volatile FX rates. By definition, all entrepreneurial activities incur risks, and coping with risk has therefore always been an important managerial function. In recent years, however, risk management has received increasing attention in both corporate practice and the literature. This is particularly true for the management of financial risks, i.e. the management of foreign exchange risk, interest rate risk and other financial market risks. A major reason for this is the development of markets for derivative financial instruments. Forward contracts, futures, options, swaps and other, more complex financial instruments today allow firms to transfer risks to other economic agents who are better able, or more willing, to bear them. In 1971, the Bretton Woods system of administering fixed foreign exchange rates was abolished in favour of market-determination of foreign exchange rates; a regime of fluctuating exchange rates was introduced. Besides market-determined fluctuations, there was a lot of volatility in other markets around the world owing to increased inflation and the oil shock. Corporates struggled to cope with the uncertainty in profits, cash flows and future costs. It was then that financial derivatives foreign currency, interest rate, and commodity derivatives emerged as means of managing risks facing corporations. The interest in the potential vulnerability of multinational firms to foreign exchange rate risk is heightened by the wide currency fluctuations experienced during the last few decades and this issue has engendered a considerable amount of research (Muller, A., Verschoor, W.F.C. 2006). In India, exchange rates were deregulated and were allowed to be determined by markets in 1993. The economic liberalization of the early nineties facilitated the introduction of derivatives based on interest rates and foreign exchange. However derivative use is still a highly regulated area due to the partial convertibility of the rupee. Currently forwards, swaps and options are available in India and the use of foreign currency derivatives is permitted for hedging purposes only (Giddy et.al. 1992). 1.2 Problem Statement Transaction exposure to foreign exchange risk results from the effect of (unanticipated) changes in the spot exchange rate on the base currency value of foreign currency cash flows (contractual payables and receivables). Financial hedging of transaction exposure is implemented by taking an opposite position (to the spot position) on a currency derivate (such as forwards, futures and options) or by using money market hedging. In some cases, however, financial hedging may not be possible or it may be too expensive. For example, forwards, futures, and options may not be available for some currencies or for long maturities, and it may not be possible to obtain credit lines in certain currencies (which precludes money market hedging). This observation is particularly valid for countries where financial markets are rudimentary. If a firm facing (transaction) exposure to foreign exchange risk cannot indulge in financial hedging, it may resort to the operational hedging techniques of risk sharing and currency collars, which can be implemented by using customised hedge contracts embedded in the underlying trade contracts. Under a risk sharing arrangement, the benefits accruing to one party of a transaction as a result of a favourable change in the exchange rate (which is necessarily an unfavourable change for the other party) are shared by the two parties. A currency collar, on the other hand, is used to set a minimum value for the base currency value of cash flows at the expense of setting a maximum value. Thus, it involves a trade-off between potential loss and potential gain. The unpredictability of forex market may erode or even eliminate the profit margin built into an international sale at the time the sale was carried out, when selling on terms of weeks and even months. Foreign exchange rate keeps on fluctuating and they depend upon the market forces of demand and supply (Platt, G. 2007). Hedging refers to managing risk to an extent that makes it bearable. In international trade and dealings foreign exchange play an important role. Fluctuations in the foreign exchange rate can have significant impact on business decisions and outcomes. Many international trade and business dealings are shelved or become unworthy due to significant exchange rate risk embedded in them. Historically, the foremost instrument used for exchange rate risk management is the forward contract. Forward contracts are customized agreements between two parties to fix the exchange rate for a future transaction. This simple arrangement would easily eliminate exchange rate risk, but it has some shortcomings, particularly getting a counter party who would agree to fix the future rate for the amount and time period in question may not be easy. In India many businesses are not even aware that some banks do provide forward rate arrangements as a service to their customers. By entering into a forward rate agreement with a bank, the businessman simply transfers the risk to the bank, which will now have to bear this risk. Of course the bank in turn may have to do some kind of arrangement to manage this risk. Forward contracts are somewhat less familiar, probably because there exists no formal trading facilities, building or even regulating body. 1.3 Research Objectives and Questions There is a need to identify, quantify, and evaluate a firms risk exposure and to choose appropriate procurement strategies. The general objective of this study is to incorporate procurement and marketing decisions into a single hedging model, considering risk factors typically faced by firms in the textiles and garment industry. There are several reasons to explain why foreign risk management has gained in popularity over the last decades. The most important reason lies in the increased volatility of exchange rates, interest rates, and commodity prices, causing firms cash flows to become more uncertain. Secondly, firms tend to focus more on their core business, which makes them less diversified. As a consequence, the volatility of firms cash flows may increase. A third reason for the growing importance of foreign risk management can be found in the globalization of business activities, in which competition has increased and profit margins have declined. A final explanation we offer is the growing number of opportunities to manage risks. Based on the problem discussion our research objectives are formulated as follows: To review and critically analyse the practices adopt by the Indian exporters to hedge the forex risk. To evaluate the impact of foreign exchange risk on exporters and exports of a country like India To critically compile the issues faced by the Indian exporters in hedging foreign exchange risk. Based on the above stated research objectives the following research questions have been developed: RQ 1: How the export company determines foreign exchange risk? RQ 2: Which level the company can actively manage foreign exchange risk? RQ 3: How it can hedge the forex risk? RQ 4: What techniques are preferred by company in its forex risk management? 1.4 Relevance of Research Currently there is a scarcity of research papers about currency exposure management in companies in emerging markets. Theoretical studies like that of Copeland and Copeland (1999) are usually supported by the findings from developed countries (the USA, Canada, the UK). Therefore, the application of such studies might be complicated in developing markets. Researchers that analyze the foreign exposure management in companies often use large samples and questionnaires to evaluate the derivate use, and are successful in describing countries with well-developed markets. For emerging markets like India such quantitative approaches are extremely rare. Most often the situation with currency exposure management and application of derivatives by non-financial institutions is reflected in the newspapers. Yet, these articles are not academic papers and serve only as descriptions of the situation. Therefore, this study will be distinctive in several areas. First, it concentrates on India and will contribute to the increase in the number of academic studies about emerging markets. Second, it will contribute to the business community , as it will analyze the application of derivatives by exporting companies for hedging currency exposure and reveal the causes higher or lower popularity of derivatives. Third, it will apply the theoretical model which was developed based on the practice in developed countries, and test if the results from model application match the empirical findings in reality in India. 1.5 Outline of the Study This dissertation consists of five chapters (see Figure 1.1). In chapter one, a relative broad description is given in the beginning, providing the reader with a background and discussion of issues related to the problem area. This discussion lands in a specific research problem, which has been broken down into research questions. Chapter two gives a presentation of theories relevant for the research problem. Continuously, a description and justification of the methodological approaches chosen in this thesis is given in Chapter three. In chapter four the received empirical data is presented and contains an analysis of the collected data against the theory. Finally, conclusions and implications are presented in chapter five. Literature Review This chapter reviews the literature theory of foreign exchange risk management include the concepts of foreign exchange risks, its characteristics by different types, and hedge theory of foreign exchange risks. 2.1 Foreign exchange risk Whenever a company is running overseas business, the company is exposed to different categories of risk including commercial risk, financial risk, country risk and foreign exchange risk (Oxelheim 1984). Country Risk Foreign Exchange Risk Financial Risk Commercial Risk Figure2.1 The company risk Source: Oxelheim 1984, p14 Foreign exchange risk is commonly defined as the additional variability experienced by a multinational corporation in its worldwide consolidated earnings that results from unexpected currency fluctuations. It is generally understood that this considerable earnings variability can be eliminated-partially or fully-at a cost, the cost of Foreign Exchange Risk Management. (Jacques, 1981). According to Shapiro (2006), foreign exchange rate exposure can be defined as a measure of the potential changes in a firms profitability, net cash flow and market value because of a change in exchange rates. 2.2 The existing classifications of foreign exchange risks In the recent literature of foreign exchange exposure management, the types of exposures are usually summarized and simplified into three categories, translation, transaction, and economic ( Cowdell, 1993; Girnblatt and Titamn, 1998; Eitman et. al.,1998 and Shapiro, 2006). It is conventionally stated that the exposure to currency risk is categorized into three factors; seen below in figure 2.2. Figure 2.2 Types of currency risk exposure Source: Eun et al.,2007 Transaction Exposure The transaction exposure concept concentrates on contractual commitments which involve the actual conversion of currencies. A firms transaction exposure thus consists of its foreign currency accounts receivables and payables, its longer-term foreign currency investments and debt, as well as those of its foreign currency cash positions which are to be exchanged into other currencies. Until these positions are settled, their home currency value may be impaired by unfavorable parity changes. There exist four possibilities by which transaction exposure may arise (Eiteman 2007): When prices are stated in foreign currencies and the firm decides to purchase or sell goods or services. When borrowing or lending funds while contractual agreements on repayment are to be make in a foreign currency. When becoming a party to an unimplemented foreign exchange forward contract. When incurring liabilities or acquiring assets which are denominated in foreign currencies. The total transaction exposure consists of quotation exposure, backlog exposure and billing exposure, see figure 2.3: Figure 2.3 The life span of a transaction exposure Source: Eiteman et al., 2007 2.2.2 Economic Exposure The economic exposure, also called the operating exposure, measures any change in the present value of a company resulting from changes in future operating cash flows caused by unexpected changes in currency exchange rates. The analysis of economic exposure assesses the result of changing exchange rates on a companys own operations over coming months and years and on its competitive position in comparison with other companies. By measuring the effects on future cash flows related to economic exposure, the goal is to identify strategic moves or operating techniques that a company might wish to adopt in order to enhance its value in the face of unexpected exchange rate changes (Eiteman et al., 2007). Loderer and Pichler (2002) assert that firms often manage economic exposure by lending and borrowing in foreign currencies. He cites the following reasons for not hedging economic exposure: firms are unable to measure the size and the currency of future expected cash flows with much confidence, firms already hedge transaction exposure, firms consider that in the long term currency fluctuations offset each others. Surprisingly, the cost of hedging economic exposure is not an obstacle. 2.2.3 Translation exposure By consolidating its financial statements, a parent company with foreign operations must translate the assets and liabilities of its foreign subsidiaries, which are stated in a foreign currency, into the reporting currency of the parent firm. Basically, foreign subsidiaries must restate their local currency into the main reporting currency so the foreign values can be added to the parents reporting currency denominated balance sheet and income statement. The translation is usually used for measuring a subsidiarys performance(McInnes, 1971), providing accurate information for decision makers and investors (Ross, 1992; Bartov, 1995), and for both internal and external users (Sercu and Uppal, 1995). The common reason for translation from a foreign currency into the home currency is to meet the requirements of accounting regulations of home countries. External Hedging Methods As it is shown, the exposure to currency risk may involve current business transactions, future business transactions as well as financial statement translations. However, as there are factors or risk, so are there strategies for dealing with them. For companies, there are a number of external methods to use for the management of currency risk, namely the use of financial derivatives. The name derivative arises from the fact that the value of these instruments is derived from an underlying asset like a stock or a currency. By using these instruments it is possible to reduce the risks associated with the management of corporate cash flow, a method known as hedging. Financial market hedging instruments include (Butler, 2004): Fig 2.4: External Hedging Techniques 2.3.1 Foreign Exchange Forwards A foreign exchange forward is an agreement to buy or sell one currency at a certain future date for a certain price with a specific amount. It is the most common instrument used to hedge currency risk. The predetermined exchange rate is the forward exchange rate. The amount of the transaction, the transaction date, and the exchange rate are all determined in advance where the exchange rate is fixed on the day of the contract but the actual exchange takes place on a pre-determined date in the future. In major currencies, forward contracts can be available daily with maturities of up to 30, 90 or 180 days (Bodie Marcus 2008). A survey by Belk and Glaum (1990) indicates that the most common method used to hedge exchange rate risk is the forward contract. An empirical study of Pramborg (2002), also demonstrates that firms can be fully hedged with forward contracts. 2.3.2 Currency Futures In principle, a futures contract can be arranged for any product or commodity, including financial instruments and currencies. A currency futures contract is a commitment to deliver a specific amount of a specified currency at a specified date for an agreed price incorporated in the contract. The futures perform a similar function to a forward contract, but it has some major differences. Fig 2.5 Currency Futures The specific characteristics of currency futures include (Pike et.al., 1992): They are marketable instruments traded on organized futures markets. Futures can be completed (liquidated) before the contracted date, whereas a forward contract has to run to maturity. They are relatively inflexible, being available for only a limited range of currencies and for standardized maturity dates. The dealings occur in standard lot sizes, or contracts. They require a down-payment of margin of about 5 percent of the contract value, whereas forward contracts involve a single payment at maturity. Futures are usually cheaper than forwards contracts, requiring a small commission payment rather than a buy / sell spread. Table 2.1 provides a clearer summary of the major differences between forward and futures contracts. Table 2.1: Major Differences between Forward and Futures Contracts Forward Contracts Futures Contracts Customized contracts in terms of size and delivery dates Standardized contracts in terms of size and delivery dates Private contracts between two parties Standardized contracts between a customer and a clearing house Difficult to reverse a contract Contract may be freely traded on the market Profit and loss on a position is realized only on the delivery date All contracts are marked to market- the profit and loss are realized immediately. No explicit collateral, but standard bank relationship necessary Collateral (margins) must be maintained to reflect price movements Delivery or final cash settlement usually takes place. Contract is usually closed out prior to Maturity Source: Hull (2006), Moffett et al (2006) and Solnik and McLeavey (2004). 2.3.3 Currency options A foreign exchange option which is different from currency forward contracts and currency futures is to give the holder of the contract the right to buy or sell a certain amount of a certain currency at a predetermined price (also called strike or exercise price) until or on a specified date, but he is not obliged to do so. The seller of a currency option has obligation to perform the contract. The right to buy is a call; the right to sell, a put. There is option premium needed to pay by those who obtain such a right. The holder of a call option can benefit from a price increases (profit is the difference between the market price and the strike price plus the premium), while can choose not to excise when the price decreases (locked in loss of the option premium). Vice versa is for the holder of a put option. For the advantages of simplicity, flexibility, lower cost than the forward, and the predicted maximum losswhich is the premium, the currency option has become increasing popular as a hedging devise to protect firms against the exchange movements. Whenever there is uncertainty in the size of cash flows and the timing of cash flows, currency option contracts would be superior to traditional hedging instruments such as forward contracts and futures contracts. Grant and Marshall (1997) examined the extent of derivative use and the reasons for their use by carried out surveys in 250 large UK companies, found that a widespread use of both forwards and options(respectively 96% and 59%). The pointed that comparing to the primary reasons for the use of forwards were company policy, commercial reasons and risk aversion, a good understanding of instrument, and price were prominent while the primary reasons to use option for company management. 2.3.4 Currency Swaps Currency swaps are a hedging instrument for which two parties agree to swap a debt denominated in one currency for that in another currency. For example, an agreement between two firms to swap their debts of which one is denominated in Euro and that in US dollar (Leger and Fortin, 1994). In order to explain the use of currency of swaps, a Japanese firm that has exports to Australia is given as an example. The Japanese firm wants to protect its Australian-dollar receivables by using currency swap to match inflows in one currency with outflows in a foreign currency (natural hedging). Assuming the Japanese firm is not well recognized in the US financial markets, it may obtain funds from a domestic bank to swap with another firm that has dollar-denominated debt. This process is carried out by the swap dealers (usually banks) as an intermediary. The common objective of this type of transaction is that firms want to alter various future currency cash flows in its schedules into a particular currency for which its future revenues will be generated (Eiteman et.al 1998). The preference of particular currency is caused by several factors, such as, capital market segmentation, differences in regulation governing investment by institutional investors and asymmetry in the tax treatment of interest income and capital gains/losses (Jacque 1996). Although there are other types of swaps involving foreign currencies, such as, foreign currency forward swaps, plain vanilla, and a three-way back-to-back currency swap, they are designated primarily for hedging interest rate exposure. 2.4 Internal hedging methods For the reason that external hedging techniques with derivatives to manage foreign exchange exposure are often costly, many multinational firms would rather turn to consider using internal hedging devices such as Michael (2006): Currency matching, which involves pairing suitably a multinational firms foreign currency inflows and outflows with respect to amount and timing Currency netting, which involves the consolidated settlement of receivables, payables and debt among the subsidiaries of a multinational firm Invoicing in domestic currency, which reduces transaction risk primarily related to exports and imports. 2.5 Fundamental Philosophy behind Hedging We have presented that authors embrace hedging as insurance, and hedging as a value-enhancing tool. We believe the common view of hedging can be summarized as follows: Hedging is one of the three most fundamental reasons for the existence of the financial market, alongside speculative and arbitrage activities (JÃ ¼ttner, 2000). The hedging industry is evolving just like the rest of the business world. In fact, there is no definite set of tools or technique that can define hedging. As the world changes, new hedging mechanisms are derived; and as time passes, these mechanisms are refined and evolve into something new that can be better applied to the contemporary commercial marketplace (Batten et al, 1993; Faff and Chan, 1998; Alster, 2003;). Hedging is not a way of making money, but to assist management in better managing corporate revenue through reducing the corporate exposure to volatility in the foreign currency markets (Nguyen and Faff, 2002, 2003a; Anac and Gozen, 2003; Alster, 2003; De Roon et al., 2003; and Dinwoodie and Morris 2003). When used prudently, hedging can be effective insurance as well as a value-enhancing exercise for corporations. Effective hedging programs have been proven to allow corporations to minimize or transfer their foreign currency exposure. The diminished exposure to foreign currency fluctuations allows more stable and predictable cash-flows, notably in terms of revenue. As a result, firms are then capable of making more comprehensive financial plans, including more reliable estimations on tax, income after tax and dividends payable to shareholders. It is believed that a dividend payout is often of significant appeal to long-term, current or prospective shareholders (Nguyen and Faff, 2002, 2003b; Alster, 2003; Anac and Gozen, 2003; De Roon et al., 2003; and Dinwoodie and Morris, 2003). The three main questions surrounding hedging: when, what and how to hedge are shown in Figure 2.2 below as a decision tree. How to Hedge? Hedge Ratio 10% 50% 100% OR Any Ratio between 0.1%-99.9% What to Hedge? When to Hedge? Financial Tools Forward Futures Options Swap Hedge Under Currency Risk Exposure Non-Financial Tools Leading Lagging Fully participating market movements No Hedge Fig 2.7 Generic Hedging Decision Tree The question to hedge or not to hedge is a complex and controversial one in financial risk management. Natural hedges carry no explicit out of pocket cost and intrinsically form a better offset to economic exposures and so generally are preferred to synthetic hedges. Synthetic hedging can be likened to insurance, where the company incurs an explicit cost to reduce the risk or volatility inherent in its business results. The cost must be weighed against the risk-reducing benefits of the transactions, taking into account their precision and effectiveness. The real drivers of any hedging decision are 1) what is the risk tolerance of the company; and 2) what cost is acceptable for entering into transactions to reduce or eliminate the risk. Foreign currency-denominated activities engaged by Indian Exporters Expected payments of foreign exchange from trade Expected receipts of foreign exchange from trade Liabilities Assets Debt Debt Equity Net trade foreign exchange exposure (before derivates) Net balance sheet foreign exchange exposure (before derivatives) Foreign exchange Derivatives Net foreign exchange exposure (after derivatives) Fig 2.8: Decision to Hedge Foreign Currency Exposures Some managers feel strongly that hedging either should always be done or never done, and their approaches vary tremendously. Indeed, there is an academic perspective that hedging is never appropriate since risks like FX exposure represent diversifiable risks from the shareholder perspective, and thus, the cost is wasted effort for shareholders. Some managers share this view, but most multinational businesses of significant size engage in some financial hedging transactions. Major arguments for and against hedging are displayed in Table 2.2 Table 2.2: Theoretical Arguments on Hedging For Against Managing earnings volatility for FX risk can reduce a firms potential cost of financial distress. PPP and CIP imply compensating levels of FX rates and prices. Firms in financial distress face higher contracting costs with customers, suppliers, and employees. FX rates even out over time. Firms that hedge and reduce their earnings volatility pay less taxes over the long run if tax rates increase the income levels. With transactions costs, hedging is a losing bet on average. Managing FX risk and smoothing earnings volatility has a positive effect on stock price and shareholder value. Shareholders can diversify their own portfolios to compensate for FX risk.

Character Sketch of The Sniper :: Sniper

Character Sketch of The Sniper War. Death. Pain. Anger and remorse. None are pleasantries, but all are faced and handled every day. In Liam O'Flaherty's "The Sniper," all of these things are brought to an acute reality. To aid in his creation of such emotional conflict, O'Flaherty portrayed the sniper as a very controversial character. We can see this contrast in personality by looking at appearance, actions, and thoughts. "...the face of a student, thin and ascetic,...eyes had the cold gleam of the fanatic." And so the sniper is described in a physical sense. Upon looking at the meaning of the words, we find an unexpected conflict of definition. O'Flaherty writes that the sniper's face is "that of a student." We think young, and vibrant. However, to describe his meaning, he goes on to say that his face is both "thin and ascetic." Also, gaunt, and displaying self-discipline; both qualities carried more so in adults than students. Also, it is stated that the sniper had "the eyes of a man who is used to looking at death." One might imagine an older man, who has lived through many-a-war and seen lives lost. These three descriptions show that the sniper was older than his years in appearance, as well as emotionally. The snipers' actions also are cause to believe that he is more than meets the eye. In the story, the sniper considers lighting a cigarette. "It was dangerous...he decided to take the risk." One's knowledge that something is dangerous and then their persistence to carry out the action shows a true daredevil. A characteristic of the "student" in him mentioned earlier. Another, much different, action of the sniper's is the need to discover who he killed. After the remorse of the crime committed, the sniper proceeds to investigate his enemy's identity. "...felt a sudden curiosity as to the identity of the enemy sniper..." This shows that the sniper did, in fact, have a streak of humaneness and care in him. A very different mood from the daredevil. Lastly, the way the sniper thinks reveals much about his character. When he is considering means of escape, he comes up with a plan to trick the enemy sniper into believing he himself was dead.

Best Buy Failure in China (International Business) Essay

In the world today, there are many companies getting involved in international business, and developing to become a multinational company. Why do these firms want to take the multinational route? One of the dominant frameworks to explain the existence of these multinational companies is the Ownership-Location-Internalisation (OLI) paradigm (Dunning & Lundan 2008). Running an international business is different from running a domestic business. International business requires you to recognise and understand the cultural differences between countries. Failing to recognise and understand this difference could possibly lead to many difficulties, or worse still, failure. In this essay, I will be discussing the difficulties that Best Buy Co. Inc. faced, and its eventual failure due to the lack of understanding of the cultural differences in its host country, China. The rise of China has matured into hope for the entire consumer electronics industry. The country’s 1.3 billion consumers and their fast increasing buying power have transformed China into the world’s largest consumer electronics market, a market opportunity that multinational giants cannot afford to neglect (Chen & He 2005). As such, Best Buy was just one of the many multinational companies that tried to enter the Chinese market. Best Buy Co. Inc. Best Buy is a multinational retailer of consumer electronics from the United States and operates in the United Kingdom, Canada, Turkey, Mexico, China as well as its home country. Started as the Sound of Music in 1966 as an audio specialty store by Richard M. Schulze, it was later changed to Best Buy Co., Inc. by the board of directors in 1983 and is now the leading consumer electronics retailer in the United States (Pederson 2004). Best Buy sells consumer electronics as well as a wide selection of related merchandise such as music, mobile phones, computers, computer software, DVDs, Blu-ray discs, video games, digital cameras, video cameras as well as home appliances. The multinational used a two-track approach to enter the Chinese market. The consumer electronics giant first opened a sourcing office in Shanghai in 2005 and began its efforts to expand into the Chinese market in May 2006 by foreign acquisition. The multinational invested $108 million to obtain a majority stake in China’s fourth largest consumer electronics retailer, Jiangsu Five Star Appliance (Bloomberg 2006). Soon after in December 2006, the company used the greenfield mode of entry and opened its first â€Å"Best Buy† store that followed their own US business model, in Shanghai’s busy Xujiahui shopping district. By imposing a US business model, Best Buy intended to convince fastidious Chinese customers with helpful and dependable service in clean, pleasant outlets. The chairman and general manager of Best Buy China, Lu Weiming declared that they were confident with the store model they had, which will differentiate them from competitors and consequently help them win the consumers’ heart (Kurtenbach 2006). The company later opened another eight stores, which increased the total number of â€Å"Best Buy† stores in China to nine. Problem Identification According to the China Daily on March 21, 2011, Jiangsu Five Star Appliance continued to expand. However, Best Buy’s expansion was slow and was not running as smoothly as anticipated. â€Å"The multinational brought in a Western business model and it failed to sufficiently attract the Chinese clients and customers,† said Chen Can, a senior analyst from Analysys International (China Daily 2011). Best Buy’s business model in the US, where the brand markets itself as delivering a better service than competitors, did not go well in China. After being in the Chinese market for five years, the company only managed to open nine stores, capturing less than one per cent of the Chinese market as according to analysts. Failing to catch on in the Asian country, the company decided in February, 2011, to close its headquarters along with all its nine stores (Birchall, Strauss & Waldmeir 2011). Causes of the problem Even though the company opened a sourcing office in 2005, the multinational still had a lot to learn about the Chinese and the way they did business. â€Å"The lesson we learned is that we got too far ahead of the Chinese consumer in how business is done in China,† said Brian Dunn, Best Buy’s Chief Executive (Groth 2011). He said the company’s mistake had been to open big box stores with fixed prices that were staffed entirely by Best Buy’s blue-shirted employees (Jopson & Waldmeir 2011). Clearly, Best Buy entered the Chinese market in 2006 with a lack of knowledge of the local consumer’s culture. International strategy is a strategy where the firm uses the core competency, which it developed at home, as its main competitive weapon in the foreign market (Sumantra & Nitin 1993). This is the strategy which Best Buy used. The company did not enter China with the intention to hire local talent who knew how to be successful in China. Rather, it entered the country intending to create talent that knew how to be successful in the United States (Adam 2011). When the multinational first entered the Chinese market, many people hoped that it would successfully replace the prevailing, yet widely criticised Chinese business model that focused on price-centred competition (Ni 2011). Imposing their core competency in the US model, the company offered â€Å"a concept ahead of the consumer,† said retail analyst Paul French of Access Asia which was based in Shanghai (Macleod 2011). Best Buy provides a premium shopping experience for its consumers, to which the Chinese consumers were ultimately not willing to pay for (Jopson 2011). Consumers in China are generally different from consumers in the United States. Wei and Salil (2010) stated that the Chinese consumers have a higher cognitive age perception, lower levels of physical health status and lower life satisfaction levels as compared to their American counterparts. Eastman et. al. (1997) conducted a study and found that there were statistically significant differences between the two, such that Chinese consumers were more materialistic than those in the United States. Eastman’s research was later backed up by Schmitt’s (1999) studies. In addition, Schmitt found that the Chinese consumers were more brand conscious and would go shopping with brands as a key influencing factor. The cross-cultural study above is just one of the reasons as to why Best Buy failed to attract consumers in China. For instance, the company’s store in China generally divides up electronics and other large-ticket items by category (Birchall, Strauss & Waldmeir 2011). However, the Chinese are inclined to put more faith in brand names than consumers in the US do. Due to this reliance on brands as a deciding factor, the Chinese consumer would generally prefer items in the store to be categorised according to their make rather than function. Another cause of the company’s failure in attracting Chinese customers lies in the fact that all sales staff in the store were the company’s direct employees who donned the ubiquitous blue Best Buy uniform. This was a stark difference to the scene in typical Chinese outlets, where consumers were accustomed to subsections of electronics stores being manned by the manufacturer’s own employees, who were also able to offer specialist knowledge (Jopson 2011). At the same time, Best Buy’s market research showed that Chinese consumers liked to try out new products. While this was true, what eventually happened was that the Chinese shoppers would first go to Best Buy to try out products, before promptly marching across the street to one of the other Chinese retailers and buying the said product for less (Adam 2011). This was partly due to the pricing in Best Buy stores, which was based on a fixed-price policy (Jopson 2011) and only served to push the Chinese consumer even further away. As stated by Montlake (2006), bargaining is a way of life in China. Chinese consumers like bargaining and they are used to negotiating with the salesperson to get a discount, which was not an option in Best Buy. Not only is bargaining not an option, the prices at Best Buy were also set at a premium as it followed the company’s US model of offering high-quality service and a better shopping experience to consumers, such as the opportunity to try products before making a purchase. However, that did not seem to suit the immature Chinese market very well (Ni 2011). Purchasing decisions made by Chinese consumers are determined by price and not service (Birchall, Strauss & Waldmeir 2011). At the same time, Chinese consumers had the perception that Gome and Suning, two of Best Buy’s biggest competitors, were able to under cut Best Buy’s prices significantly (Adam 2011). Chinese consumers care more about price than service (D’Altorio 2011). The Chinese do not penny-pinch and save because they like to, but because they have to. They voluntarily tax themselves so as to protect against the absence of a welfare safety net. If a Chinese consumer gets old, he will need that money to survive, since state pensions remain inadequate. As his parents age, he will need to support his elders, especially since he is likely to be their only child, a result of the country’s one child policy. This reality is what perpetuates and engenders the low-cost, bargain basement Chinese retail environment (French 2007). To top it off, Best Buy’s choice of a Chinese name left many consumers pondering over its decision. A country steeped in traditions and superstitions, many Chinese consumers commented that the company’s Chinese name, â€Å"Bai Si Mai†, was a bad one as it literally meant â€Å"to buy after thinking 100 times† (Ni 2011). Overall, the company’s business model, like its Chinese name, showed a lack of understanding for the Chinese culture. It tried too hard to educate Chinese consumers about high-end service value when lower prices were typically the only value that motivated them to make quick decisions. The consumer electronics giant’s overconfidence in transforming the Chinese consumer philosophy finally hurt its performance in the Chinese market. Maintaining only a small market presence in China, Best Buy not only failed to please its consumers, but its suppliers too, who did not receive many orders from the company (Ni 2011). Proposed Solutions There are huge cross-cultural differences between the US and China. Therefore, one change I will make if I was Best Buy is to take up a multi-domestic strategy instead of the international strategy adopted by the company. Multi-domestic strategies involve a high degree of customisation to the local market place (Hout, Porter & Rudden 1982). This is important, noting the huge cultural gap between the China and the US. Hill, Hwang and Chan (1990) also stated that a multi-domestic strategy is based on the belief that national markets differ widely with regard to consumer preferences and taste, competitive conditions, operating conditions and social structures. According to organisational capabilities theory, in order to leverage its competitive advantages in the foreign market, an enterprise must understand its business environments and adapt its operation modes to the host country (Xu, Hu & Fan 2011). This is also in line with the multi-domestic strategy, to which Anne-Wil (2002) has highlighted the need of multi-domestic companies to deal with markets where products tailored to local circumstances are required; and to be able to do so, companies need to be well aware of the local market and be well-integrated into it. This can be easier achieved by acquiring an existing company that possesses a knowledgeable work force and good connections in the local market. As such, the mode of entry decided upon by a multinational is a critical and strategic decision. To support the multi-domestic strategy and aligning with conditions in China, I will still first enter the Chinese market using foreign acquisition. Foreign acquisition involves having to invest in a local firm and in this case, I will be investing in Jiangsu Five Star Appliance. Acquiring Jiangsu Five Star Appliance will create access to local resources as well as knowledge of the Chinese retail environment within a much shorter span of time (Cristina & Garcia-Canal 2004). Acquisition is also a more effective way of exploiting foreign resources and markets as compared to joint ventures or licensing, as supported by the transaction cost theory (Hennart 2010). Tapping on the knowledge and expertise of Jiangsu Five Star Appliance, I will then use the greenfield method, which is the setting up of a new company legally independent from parents, to set up a Best Buy store in China (Cristina & Garcia-Canal 2004). By using a multi-domestic strategy, the management seen in the greenfield approach will be more similar to that of acquisitions (Anne-Wil 2002). The consequent Best Buy outlets will then be managed and accustomed to the Chinese market. For instance, as most Chinese consumers shop by brands, the store will therefore be segregated by brands rather than product category. Sections of the store will also be rented out to brand manufacturers and their designated areas will be staffed with their own sales team, so that consumers can receive specialised knowledge as well as bargain for a lower price. The store will not be carpeted or provide services like allowing consumers to test out the product before purchase. This is to prevent the Chinese consumers from having the perception that the store is pricier as compared to competitors, especially since China is a highly price-conscious market. As French (2007) aptly stated, â€Å"win on price and you win, period†. It is therefore of utmost importance to have a lower price as compared to competitors. In order to provide lower prices, I will acquire the real estate, instead of renting or leasing the property like my two biggest competitors Gome and Suning do. This will provide me with a great advantage as I can lower rental prices for the manufacturers, who can then pass the accumulated savings down to the Chinese consumers. Noting the Chinese aversion to inauspicious names, I will also conduct sufficient research and preparation into choosing a Chinese name for the store before its opening. Instead of using a direct sound conversion of the brand name like â€Å"Bai Si Mai†, I will translate the brand name by meaning instead, such as â€Å"Zui Hao Mai†. This literally means â€Å"best buy†, and doubles up as a call that encourages consumers not to miss out on a deal. Conclusion In conclusion, China is a huge and growing market with tonnes of opportunities that multinationals cannot afford to neglect. However, there is a huge cultural divide between China and countries from the west like the United States. Entering the Chinese market will require multinationals to recognise and understand the cultural difference between their homeland and the Chinese market. Best Buy failed in China due to a lack of knowledge and understanding of cross-cultural differences. Although the company chose the correct mode of entry by first using foreign acquisition followed by the greenfield approach, it failed because it adopted an international strategy thinking that Chinese consumers will welcome the same offerings that reflect its core competency in the US — value-added service. Thinking it could import its success in the US to China by focusing on the same areas, Best Buy’s targeted service approach failed to take off in a climate governed by financial sensitivity. While focusing on providing consumers with a great shopping experience, the company failed to consider a fundamental portion of the retail environment — price, which affects Chinese consumers much more than service. To improve on this situation, I would first enter the Chinese market through foreign acquisition, so that I may gain access to knowledge about the culture in China before starting on the greenfield route. However, instead of using an international strategy, I will opt for the multi-domestic strategy by adapting my operations towards the needs of Chinese consumers. This would circumvent the issues that led to the company’s downfall in China. Due to the country’s rich traditions, its people are habitual and tend to shy away from the unfamiliar. Should Best Buy have chosen to use a multi-domestic strategy, it would have realised the need to customise its offerings in accordance to local tastes and might have gone on to capture a larger share of China’s consumer electronics market. Reference List Adam, M. 2011, ‘Bye-Bye, Best Buy (China): You had it coming’, Adam Minter of Shanghai Scrap, 22 February, Viewed 22 August 2012, Anne-Wil, H. 2002, â€Å"Acquisitions versus Greenfield investments: International strategy and management of entry modes†, Strategic Management Journal, vol. 23, no. 3, pp. 211-227. 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