Managing Workplace Safety and Health

Nowadays, there are so many countries that have a problem with the employment of their citizens. The government of some countries can not manage to provide them with the jobs that would help them finance their living and their needs. The lack of job opportunities enables stagnation of the potential of the people thus disables the manpower of a certain country to grow and develop. Clearly, there are also so many problems that arise with this very serious unemployment.First, the resources of the country might not be used into its fullest since there are no funds for the farming or whatever job that do not require much machines or infrastructures, like with the farms and forests. Secondly, the population can increase unreasonably since people who might be just spending their time enjoying the dominion that God has permitted us with, to spread the good news and to multiply and recreate. Third, the people in a certain country might want to have a strike for their officials who do not have that potential to provide them what they need in their lives and that is to suffice the need to eat, by which I can recall as one of the primary needs of a person. Thus, this situation may lead to war making the country unfit for peaceful living.Speaking of War, we all know that Iraq is a place where some atrocities and turmoil is present because of the terrorism issue that other countries accuse them. The war has already damaged a lot of natural resources and even killed a thousand lives, whether Iraqi or other people with different nationalities that worked in Iraq. Those people who just wanted to earn something to provide their family financial support, those who already have the potentials and risked their fate by trusting that they will be safe in Iraq, were unlucky to have killed brutally by the guns and bombs that the war have given.The unemployment that is mentioned above is also a way why such people were killed in this country. Those countries that do not have enough slot s for their people tend to send those unemployed to Iraq to find money; hence what they can find is death. Their willingness to sacrifice for their families is equaled by the threats that they might encounter upon arriving at the country that could make them be drained, drained emotionally and even physically.Part of this paper is to analyze how the HR Managers treat this kind of situation aside from the fact that there are hundreds and thousands of unemployed citizens. Do they really intend to help these persons and their families or they are just for the benefit of their commissions given that those companies in Iraq, or their companies that have other bases or branch in Iraq pay double or triple times the price of a normal salary in a peaceful country? There were analyses on how these people deal with the situation given that there are really many things that are being risked in this country, Iraq.The first question goes on how the HR’s are being influenced for this kind o f risking. I think, aside from the fact that working abroad is something really adventurous to most people in the world, it is the deal that goes with the case, that is someone will have to work in Iraq and he/she will be provided of certain benefits that will encourage even his/her family to support that endeavor.There could be lots of offers that they may put into their contracts upon the acceptance of the application of those apprentices. Having so many bombings, it is not a joke to really invest one of your feet just for the sake of money, which is also one of the motivations of the HR managers that they too are risking their credibility to people who might want to work for their company. From the article of Susman saying that there really are bombings in Iraq, there are already so many warnings for the people who would want to give their best shots in Iraq. They will be heroes if they will be killed because of their loving hearts for their families.Giving the unemployed jobs in Iraq might also be a way to decrease the number of populations residing on an overpopulated country, with that intention of course that is hidden by the administration. If this is to be transferred, I think, some Hr managers can just gather these people who want to work in Iraq for big money and just give them something more difficult than letting them face the mask of death and even the haunting black man carrying a knife or a sword. Here, we can say that there are still ways to make them safe of the trouble of the war, that is to wait until the issue between Iraq and the other countries fade. As with the article of Whitaker, there was a military man who will have punishments for being the cause of fatalities with some women and children in Iraq.In my point of view, the danger of risking someone else’s life with the kind of wage the HR Managers are promising their employees is not worth the existence of those beings. It is very difficult to raise a child and give him/her th e education that he/she opt to have at their young age. Those people would always want to have something to apply their education and for the unfortunate who resides on countries with scarcity of jobs in turn be working on a country that promises only threats to their emotional and physical beings.Perhaps it can strengthen the spiritual aspects of that person that they will be able to call the Father Almighty every now and then to protect them with the harms not only the war can give them but by their bosses who might be influenced by the present turmoil in Iraq. I think, the benefits they will be getting in working in Iraq shall just be placed in funds that will enable that state or country make or build establishments that will provide them the money they need. Sometimes, courage is not measured by facing the most scary things in life but by looking for ways to solve the different struggles we encounter every day no matter how easy or complicated they are.

Gainesboro Machine Tools Corporation Essay

Synopsis and Objectives In mid September 2005, Ashley Swenson, the chief financial officer (CFO) of a large computer-aided design and computer-aided manufacturing (CAD/CAM) equipment manufacturer needed to decide whether to pay out dividends to the firm’s shareholders, or to repurchase stock. If Swenson chose to pay out dividends, she would have to also decide upon the magnitude of the payout. A subsidiary question is whether the firm should embark on a campaign of corporate-image advertising, and change its corporate name to reflect its new outlook. The case serves as an omnibus review of the many practical aspects of the dividend and share buyback decisions, including (1) signaling effects, (2) clientele effects, and (3) the finance and investment implications of increasing dividend payouts and share repurchase decisions. This case can follow a treatment of the Miller-Modigliani1 dividend-irrelevance theorem and serves to highlight practical considerations to consider when setting a firm’s d ividend policy. Suggested Questions for Advance Assignment to Students The instructor could assign supplemental reading on dividend policy and share repurchases. Especially recommended are the Asquith and Mullins article2 on equity signaling, and articles by Stern Stewart on financial communication.3 1.In theory, to fund an increased dividend payout or a stock buyback, a firm might invest less, borrow more, or issue more stock. Which of those three elements is Gainesboro’s management willing to vary, and which elements remain fixed as a matter of the company’s policy? 2.What happens to Gainesboro’s financing need and unused debt capacity if: a. no dividends are paid? b. a 20% payout is pursued? c. a 40% payout is pursued? d. a residual payout policy is pursued? Note that case Exhibit 8 presents an estimate of the amount of borrowing needed. Assume that maximum debt capacity is, as a matter of policy, 40% of the book value of equity. 3. How might Gainesboro’s various providers of capital, such as its stockholders and creditors, react if Gainesboro declares a dividend in 2005? What are the arguments for and against the zero payout, 40% payout, and residual payout policies? What should Ashley Swenson recommend to the board of directors with regard to a long-term dividend payout policy for Gainesboro Machine Tools Corporation? 4. How might various providers of capital, such as stockholders and creditors, react if Gainesboro repurchased its shares? Should Gainesboro do so? 5.Should Swenson recommend the corporate-image advertising campaign and corporate name change to the Gainesboro’s directors? Do the advertising and name change have any bearing on the dividend policy or the stock repurchase policy that you propose? Supporting Computer Spreadsheet Files For students: Case_25.xls For instructors: TN_25.xls Hypothetical Teaching Plan 1.What are the problems here, and what do you recommend? The CFO needs to resolve the issue of dividend payout in order to make a recommendation to the board. She must also decide whether to embark on a stock repurchase program given a recent drop in share prices. The problems entail setting dividend policy, deciding on a stock buyback, and resolving the corporate-image advertising campaign issue. But numerical analysis of the case shows that the problem includes other factors: setting policy within a financing constraint, signaling the directors’ outlook, and generally, positioning the firm’s shares in the equity market. 2.What are the implications of different payout levels for Gainesboro’s capital structure and unused debt capacity? The discussion here must present the  financial implications of high-dividend payouts, particularly the consumption of unused debt capacity. Because of the cyclicality of demand or overruns in investment spending, some attention might be given to a sensitivity analysis cast over the entire 2005 to 2011 period. 3.What is the nature of the dividend decision that Swenson must make? What are the pros and cons of the alternative positions? (Or alternatively, Why pay any dividends?) How will Gainesboro’s various providers of capital, such as its stockholders and bankers, react to a declaration of no dividend? What about the announcement of a 40% payout? How would they react to a residual payout? The instructor needs to elicit from the students the notions that the dividend-payout announcement may affect stock price and that at least some stockholders prefer dividends. Students should also mention the signaling and clientele considerations. 4.What risks does the firm face? Discussion following this question should address the nature of the industry, the strategy of the firm, and the firm’s performance. This discussion will lay the groundwork for the review of strategic considerations that bears on the dividend decision. 5.What is the nature of the share repurchase decision that Swenson must make? How would this affect the dividend decision? The discussion here must present the repercussions of a share repurchase decision on the share price, as well as on the dividend question. Signaling and clientele considerations must also be considered. 6.Does the stock market appear to reward high-dividend payout? What about low-dividend payout? Does it matter what type of investor owns the shares? What is the impact on share price of dividend policy? The data can be interpreted to support either view. The point is to show that simple extrapolations from stock market data are untrustworthy, largely because of econometric problems associated with size and omitted variables (see the Black and Scholes article) .4 7.What should Swenson recommend? Students must synthesize a course of action from the many facts and considerations raised. The instructor may choose to stimulate the discussion by using an organizing framework such as FRICTO (flexibility, risk, income, control, timing, and other) on the dividend and share repurchase issues. The image advertising and name change issue will be recognized as another  manifestation of the firm’s positioning in the capital markets, and the need to give effective signals. The class discussion can end with the students voting on the alternatives, followed by a summary of key points. Exhibits TN1 and TN2 contain two short technical notes on dividend policy, which the instructor may either use as the foundation for closing comments or distribute directly to the students after the case discussion. Case Analysis Gainesboro’s asset needs The company’s investment spending and financing requirements are driven by ambitious growth goals (a 15% annual target is discussed in the case), which are to be achieved by a repositioning of the firm—away from its traditional tools-and-molds business and beyond its CAD/CAM business into a new line of products integrating hardware and software—to provide complete manufacturing systems. CAD/CAM commanded 45% of total sales ($340.5 million) in 2004 and is expected to grow to three-quarters of sales ($1,509.5 million) by 2011, which implies a 24% annual rate of growth in this business segment over the subsequent seven years. In addition, international sales are expected to grow by 37% compounded over the subsequent seven years.5 By contrast, the presses-and-molds segment will grow at about 2.7% annually in nominal terms, which implies a negative real rate of growth in what constitutes the bulk of Gainesboro’s current business.6 In short, the company’s asset needs are driven primarily by a shift in the company’s strategic focus. Financial implications of payout alternatives The instructor can guide the students through the financial implications of various dividend-payout levels either in abbreviated form (for one class period) or in detail (for two classes). The abbreviated approach uses the total cash flow figures (that is, for 2005–2011) found in the right-hand column of case Exhibit 8. In essence, the approach uses the basic sources-and-uses of funds identity: Asset change = New debt + (Profits − Dividends) With asset additions fixed largely by the firm’s competitive strategy, and with profits determined largely by the firm’s operating strategy and the environment, the remaining large-decision variables are changes in debt and dividend payout. Even additions to debt are constrained, however, by the firm’s maximum leverage target, a debt/equity ratio of 0.40. This framework can be spelled out for the students to help them envision the financial context. Exhibit TN3 presents an analysis of the effect of payout on unused debt capacity based on the projection in case Exhibit 8. The top panel summarizes the firm’s investment program over the forecast period, as well as the financing provided by internal sources. The bottom panel summarizes the effect of higher payouts on the firm’s financing and unused debt capacity. The principal insight this analysis yields is that the firm’s unused debt capacity disappears rapidly, and maximum leverage is achieved as the payout increases. Going from a 20% to a 40% dividend payout (an increase in cash flow to shareholders of $95.6 million),7 the company consumes $134 million in unused debt capacity. Evidently, a multiplier relationship exists between payout and unused debt capacity—every dollar of dividends paid consumes about $1.408 of debt capacity. The multiplier exists because a dollar must be borrowed to replace each dollar of equity paid out in dividends, and each dollar of equity lost sacrifices $0.40 of debt capacity that it would have otherwise carried. Whereas the abbreviated approach to analyzing the implications of various dividend-payout levels considers total 2005 to 2011 cash flows, the detailed approach considers the pattern of the individual annual cash flows. Exhibit TN4 reveals that, although the debt/equity ratio associated with the 40% payout policy is well under the maximum of 40 in 2011, the maximum is breached in the preceding years. The graph suggests that a payout policy of 30% is about the maximum that does not breach the debt/equity maximum. Exhibits TN5 and TN6 reveal some of the financial reporting and valuation implications of alternative dividend policies. Those exhibits use a simple dividend valuation approach and assume a terminal value estimated as a multiple of earnings. The analysis is unscientific, as the case does not contain the information with which to estimate a discount rate based on the capital asset pricing model (CAPM).9 The discounted cash flow (DCF) values show that the differences in firm values are not that large and that the dividend policy choice in this case has little effect on value. This conclusion is consistent with the Miller-Modigliani dividend-irrelevance theorem. Regarding the financial-reporting effects of the policy choices, one sees that earnings per share (EPS on line 30 in Exhibits TN5 and TN6) and the implied stock price (line 31) grow more slowly at a 40% payout policy, because of the greater interest expense associated with higher leverage (see the cumulative source on line 22). Return on average equity (unused debt capacity on line 28) rises with higher leverage, however, as the equity base contracts. The instructor could use insights such as those to stimulate a discussion of the signaling consequences of the alternative policies, and whether investors even care about performance measures, such as EPS and return on equity (ROE).10 Risk assessment Neither the abbreviated nor detailed forecasts consider adverse deviations from the plan. Case Exhibit 8 assumes no cyclical downturn over the seven-year forecast period. Moreover, the model assumes that net margin doubles to 5% and then increases to 8%. The company may be able to rationalize those optimistic assumptions on the basis of its restructuring and the growth of the Artificial Workforce, but such a material discontinuity in the firm’s performance will warrant careful scrutiny. Moreover, continued growth may require new product development after 2006, which may incur significant research-and-development (R&D) expenses and reduce net margin. Students will point out that, so far, the company’s restructuring strategy is associated with losses (in 2002 and 2004) rather than gains. Although restructuring appears to have been necessary, the credibility of the forecasts depends on the assessment of management’s ability to begin harvesting potential profits. Plainly, the Artificial Workforce has the competitive advantage at the moment, but the volatility of the firm’s performance in the current period is significant: The ratio of the cost of goods sold to sales rose from 61.5% in 2003 to 65.9% in 2004. Meanwhile, the ratio of selling, general, and administrative expenses to sales is projected to fall from 30.5% in 2004 to 24.3% in 2005. Admittedly, the restructuring accounts for some of this volatility, but the case suggests several sources of volatility that are external to the company: economic recession, currency, new-competitor market entry, new product mishaps, cost overruns, and unexpected acquisition opportunities. A brief survey of risks invites students to perform a sensitivity analysis of the firm’s debt/equity ratio under a reasonable downside scenario. Students should be encouraged to exercise the associated computer spreadsheet model, making modifications as they see fit. Exhibit TN7 presents a forecast of financial results, assuming a net margin that is smaller than the preceding forecasts by 1% and sales growth at 12% rather than 15%. This exhibit also illustrates the implications of a residual dividend policy, which is to say the payment of a dividend only if the firm can afford it and if the payment will not cause the firm to violate its maximum debt ratios. The exhibit reveals that, in this adverse scenario, although a dividend payment would be made in 2005, none would be made in the two years that follow. Thereafter, the dividend payout would rise. The general insight remains that Gainesboro’s unused debt capacity is relatively fragile and easily exhausted. The stock-buyback decision The decision on whether to buy back stock should be that, if the intrinsic value of Gainesboro is greater than its current share price, the shares should be repurchased. The case does not provide the information needed to make free cash flow projections, but one can work around the problem by  making some assumptions. The DCF calculation presented in Exhibit TN8 uses net income as a proxy for operating income,11 and assumes a weighted-average cost of capital (WACC) of 10%, and a terminal value growth factor of 3.5%. The equity value per share comes out to $35.22, representing a 59% premium over the current share price. Based on that calculation, Gainesboro should repurchase its shares. Doing so, however, will not resolve Gainesboro’s dividend/financing problem. Buying back shares would further reduce the resources available for a dividend payout. Also, a stock buyback may be inconsistent with the message that Gainesboro is trying to convey, which is that it is a growth company. In a perfectly efficient market, it should not matter how investors got their money back (for example, through dividends or share repurchases), but in inefficient markets, the role of dividends and buybacks as signaling mechanisms cannot be disregarded. In Gainesboro’s case, we seem to have the case of an inefficient market; the case suggests that information asymmetries exist between company insiders and the stock market. Clientele and signaling considerations The profile of Gainesboro’s equity owners may influence the choice of dividend policy. Stephen Gaines, the board chair and scion of the founders’ families and management (who collectively own about 30% of the stock), seeks to maximize growth in the market value of the company’s stock over time. This goal invites students to analyze the impact of the dividend policy on valuation. Nevertheless, some students might point out that, as Gaines and Scarboro’s population of diverse and disinterested heirs grows, the demand for current income might rise. This naturally raises the question: Who owns the firm? The stockholder data in case Exhibit 4 show a marked drift over the past 10 years, moving away from long-term individual investors and toward short-term traders; and away from growth-oriented institutional investors and toward value investors. At least a quarter of the firm’s shares are in the hands of investors who are looking for a turnaround in the not too distant future.12 This lends urgency to the dividend and signaling question. The case indicates that the board committed itself to resuming a  dividend as early as possible —â€Å"ideally in the year 2005.† The board’s letter charges this dividend decision with some heavy signaling implications: because the board previously stated a desire to pay dividends, if it now declares no dividend, investors are bound to interpret the declaration as an indication of adversity. One is reminded of the story, â€Å"Silver Blaze,† written by Sir Arthur Conan Doyle featuring the famous protagonist Sherlock Holmes, in which Dr. Watson asks where to look for a clue: â€Å"To the curious incident of the dog in the nighttime,† says Holmes. â€Å"The dog did nothing in the nighttime,† Watson answers. â€Å"That was the curious incident,† remarked Sherlock Holmes.13 A failure to signal a recovery might have an adverse impact on share price. In this context, a dividend—almost any dividend—might indicate to investors that the firm is prospering more or less according to plan. Astute students will observe that a subtler signaling problem occurs in the case: What kind of firm does Gainesboro want to signal that it is? Case Exhibit 6 shows that CAD/CAM equipment and software companies pay low or no dividends, in contrast to electrical machinery manufacturers, who pay out one-quarter to as much as half of their earnings. One can argue that, as a result of its restructuring, Gainesboro is making a transition from the latter to the former. If so, the issue then becomes how to tell investors. The article by Asquith and Mullins14 suggests that the most credible signal about corporate prospects is cash, in the form of either dividends or capital gains. Until the Artificial Workforce product line begins to deliver significant flows of cash, the share price is not likely to respond significantly. In addition, any decline in cash flow, caused by the risks listed earlier, would worsen the anticipated gain in share price. By implication, the Asquith–Mullins work would cast doubt on corporate-image advertising. If cash dividends are what matters, then spending on advertising and a name change might be wasted. Stock prices and dividends Some of the advocates of the high-dividend payout suggest that high stock prices are associated with high payouts. Students may attempt to prove that point by abstracting from the evidence in case Exhibits 6 and 7. As we know from academic research (for example, Friend and Puckett),15 proving the relationship of stock prices to dividend payouts in a scientific way is extremely difficult. In simpler terms, the reason is because the price/earnings (P/E) ratios are probably associated with many factors that may be represented by dividend payout in a regression model. The most important of those factors is the firm’s investment strategy; Miller and Modigliani’s16 dividend-irrelevance theorem makes the point that the firm’s investments—not the dividends it pays—determine the stock prices. One can just as easily derive evidence of this assertion from case Exhibit 7. The sample of zero-payout companies has a higher average expected return on capital (24.9%) than the sample of high-payout companies (average expected return of 9.4%); one may conclude that zero-payout companies have higher returns than the high-payout companies and that investors would rather reinvest in zero-payout companies than receive a cash payout and be forced to redeploy the capital to lower-yielding investments. Decision The decision for students is whether Gainesboro should buy back stock or declare a dividend in the third quarter (although, for practical purposes, students will find themselves deciding for all of 2005). As the analysis so far suggests, the case draws students into a tug-of-war between financial considerations, which tend to reject dividends and buybacks at least in the near term, and signaling considerations, which call for the resumption of dividends at some level, however, small. Students will tend to cluster around the three proposed policies: (1) zero payout, (2) low payout (1% to 10%), and (3) a residual payout scheme calling for dividends when cash is available. The arguments in favor of zero payout are: (1) the firm is making the  transition into the CAD/CAM industry, where zero payout is the mode; (2) the company should not ignore the financial statements and act like a blue-chip firm—Gainesboro’s risks are large enough without compounding them by disgorging cash; and (3) the signaling damage already occurred when the directors suspended the dividend in 2005. The arguments in favor of a low payout are usually based on optimism about the firm’s prospects and on beliefs that Gainesboro has sufficient debt capacity, that Gainesboro is not exactly a CAD/CAM firm, and that any dividend that does not restrict growth will enhance share prices. Usually, the signaling argument is most significant for the proponents of this policy. The residual policy is a convenient alternative, although it resolves none of the thorny policy issues in the case. A residual dividend policy is bound to create significant signaling problems as the firm’s dividend waxes and wanes through each economic cycle. The question of the image advertising and corporate name change will entice the naive student as a relatively cheap solution to the signaling problem. The instructor should challenge such thinking. Signaling research suggests that effective signals are both unambiguous and costly. The advertising and name change, costly as they may be, hardly qualify as unambiguous. On the other hand, seasoned investor relations professionals believe that advertising and name changes can be effective in alerting the capital markets to major corporate changes when integrated with other signaling devices such as dividends, capital structure, and investment announcements. The whole point of such campaigns should be to gain the attention of the â€Å"lead steer† opinion leaders. Overall, inexperienced students tend to dismiss the signaling considerations in this case quite readily. On the other hand, senior executives and seasoned financial executives view signaling quite seriously. If the class votes to buy back stock or to declare no dividend in 2005, asking some of the students to dictate a letter to shareholders explaining the board’s decision may be useful. The difficult issues of credibility will emerge in class with a critique of this letter. If the class does vote to declare a dividend payout, the instructor can challenge the students to identify the operating policies they gambled on to make their decision. The underlying question: If adversity strikes, what will the class sacrifice first: debt, or dividend policies? To use Fisher Black’s term, dividend policy is â€Å"puzzling,† largely because of its interaction with other corporate policies and its signaling effect.17 Decisions about the firm’s dividend policy may be the best way to illustrate the importance of managers’ judgments in corporate finance. However the class votes, one of the teaching points is that managers are paid to make difficult, even high-stakes policy choices on the basis of incomplete information and uncertain prospects. Exhibit TN1 GAINESBORO MACHINE TOOLS CORPORATION The Dividend Decision and Financing Policy The dividend decision is necessarily part of the financing policy of the firm. The dividend payout chosen may affect the creditworthiness of the firm and hence the costs of debt and equity; if the cost of capital changes, so may the value of the firm. Unfortunately, one cannot determine whether the change in value will be positive or negative without knowing more about the optimality of the firm’s debt policy. The link between debt and dividend policies has received little attention in academic circles, largely because of its complexity, but it remains an important issue for chief financial officers and their advisors. The Gainesboro case illustrates the impact of dividend payout on creditworthiness. Dividend payout has an unusual multiplier effect on financial reserves. Table TN1 varies the total 2005–2011 sources-and-uses of funds information given in case Exhibit 8, according to different dividend-payout levels. Exhibit TN1 (continued) Table TN1 Exhibit TN1 (continued) As Table TN1 reveals, one dollar of dividends paid consumes $1.40 in unused debt capacity. At first glance, this result seems surprising—under the sources-and-uses framework, one dollar of dividend is financed with only one dollar of borrowing. The sources-and-uses reasoning, however, ignores the erosion in the equity base: A dollar paid out of equity also eliminates $0.40 of debt that the dollar could have carried. Thus, a multiplier effect exists between dividends and unused debt capacity, whenever a firm borrows to pay dividends. Choosing a dividend payout will affect the probability that the firm will breach its maximum target leverage. Figure TN1 traces the debt/equity ratios associated with Gainesboro’s dividend-payout ratios. Figure TN1. Plainly, the 40% dividend-payout ratio violates Gainesboro’s maximum debt/equity ratio of 40%. The conclusion is that, because the dividend policy affects the firm’s creditworthiness, senior managers should weigh the financial side effects of their payout decisions, along with the signaling, segmentation, and investment effects, to arrive at their final decision for the dividend policy. Exhibit TN2 GAINESBORO MACHINE TOOLS CORPORATION Setting Debt and Dividend-Payout Targets The Gainesboro Machine Tools Corporation case well illustrates the challenge of setting the two most obvious components of financial policy: target payout and debt capitalization. The policies are linked with the firm’s growth target, as shown in the self-sustainable growth model: gss = (P/S ï€ ªÃƒâ€" S/A Ãâ€" A/E)(1 − DPO) Where: gss is the self-sustainable growth rate P is net income S is sales A is assets E is equity DPO is the dividend-payout ratio This model describes the rate at which a firm can grow if it issues no new shares of common stock, which describes the behavior or circumstances of virtually all firms. The model illustrates that the financial policies of a firm are a closed system: Growth rate, dividend payout, and debt targets are interdependent. The model offers the key insight that no financial policy can be set without reference to the others. As Gainesboro shows, a high dividend payout affects the firm’s ability to achieve growth and capitalization targets and vice versa. Myopic policy—failing to manage the link among the financial targets—will result in the failure to meet financial targets. Setting Debt-Capitalization Targets Finance theory is split on whether gains are created by optimizing the mix of debt and equity of the firm. Practitioners and many academicians, however, believe that debt optima exist and devote great effort to choosing the firm’s debt-capitalization targets. Several classic competing considerations influence the choice of debt targets: 1.Exploit debt-tax shields. Modigliani and Miller’s theorem implies that in the world of taxes, debt financing creates value.1 Later, Miller theorized that when personal taxes are accounted for, the leverage choices of the firm might not create value. So far, the bulk of the empirical evidence suggests that leverage choices do affect value. 2.Reduce costs of financial distress and bankruptcy. Modigliani and Miller’s theory naively implied that firms  should lever up to 99% of capital. Virtually no firms do this. Beyond some prudent level of debt, the cost of capital becomes very high because investors recognize that the firm has a greater probability of suffering financial distress and bankruptcy. The critical question then becomes: What is â€Å"prudent†? In practice, two classic benchmarks are used: a. Industry-average debt/capital: Many firms lever to the degree practiced by peers, but this policy is not very sensible. Industry averages ignore differences in accounting policies, strategies, and earnings outlooks. Ideally, prudence is defined in firm-specific terms. In addition, capitalization ratios ignore the crucial fact that a firm goes bankrupt because it runs out of cash, not because it has a high debt/capital ratio. b. Firm-specific debt service: More firms are setting debt targets based on the forecasted ability to cover principal and interest payments with earnings before interest and taxes (EBIT). This practice requires forecasting the annual probability distribution of EBIT and setting the debt-capitalization level, so that the probability of covering debt service is consistent with management’s strategy and risk tolerance. 3.Maintain a reserve against unforeseen adversities or opportunities. Many firms keep their cash balances and lines of unused bank credit larger than may seem necessary, because managers want to be able to respond to sudden demands on the firm’s financial resources caused, for example, by a price war, a large product recall, or an opportunity to buy the toughest competitor. Academicians have no scientific advice about how large those reserves should be. 4.Maintain future access to capital. In difficult economic times, less creditworthy borrowers may be shut out from the capital markets and, thus, unable to obtain funds. In the United States, â€Å"less creditworthy† refers to the companies whose debt ratings are less than investment grade (which is to say, less than BBB2 or Baa3). Accordingly, many firms set debt targets in such a way as to at least maintain a creditworthy (or investment grade) debt rating. 5.Opportunistically exploit capital-market windows. Some firms’ debt policies vary across the capital-market cycle. Those firms issue debt when interest rates are low (and issue stock when stock prices are high); they are bargain-hunters (even though no bargains exist in an efficient market). Opportunism does not explain how firms set targets so much as why firms deviate from those targets.

Minimum of Two Suggests That Family Can Be Both a Blessing and a Curse

In Tim Winton’s collection of short stories, ‘Minimum of Two’, family is a major, recurring theme. Winton displays his interest in exploring the idea of family within each story differently, containing the positive and negative influence that family has on the actions and emotions of the Nilsam family and his alternative protagonists. In ‘Distant Lands’, he deals with the feeling of obligation towards and the traditional expectations of family whilst in ‘The Water Was Dark’ the focus is on a need to separate oneself from negative family completely. Laps’ focuses on how family can help you move on from her past. Winton has a strong belief that family shapes the kind of person one becomes, regardless of whether that is a good, or bad natured person. Within the short story ‘Distant Lands’, although it is portrayed subtly, family plays an important role. We are told of Fat Maz’s parents; her mother, who sits in the family shop for the majority of her day, emitting ‘dull thudding’ sounds from the register and Maz’s father, who is portrayed as a hot headed, intimidating individual. As Winton goes on to display Maz’s character, which contains attributes the likes of reserved, self-conscious yet quietly ambitious, we are made to create a link between Maz’s persona and her parents, that of which one is silent and dismal and the other unapproachable, and the realization that it was the impact of her family that has built the aspects her character by failing to restore her confidence and paying little to no attention of whether Maz had her own ambitions. This contributes to her overall quietness. The Water Was Dark’ has it’s protagonist, ‘the girl’, who is struggling to escape from the negativity of her mother. The girl lists her mother’s many faults bitterly and her mother’s poor decisions’ impact show heavily as we read in to the girl’s thoughts. The girl has no actual stability that she feels in her life and she is angry at her mother because her mother is to be blamed. She actually says in many a sense that her life would collectively improve if her mother rid herself of the poisonous things in her life, like drinking and being isolated. Basically, the state of the girl’s family is so ruined that she herself becomes destructive. Despite the lack of encouragement, in ‘Distant Lands’ Maz’s parents actually follow the traditional expectations associated with family. They give Maz a roof over a head and a secure, paying job in a small town. It is not what Maz wants however it is a safe, stable environment and so Maz feels a sense of debt towards her family. ‘Laps’ revolves around Queenie and her family. Queenie’s daughter Dot provides a great contrast in regards to most of the adolescents Winton writes. She is not only in a secure and stabile lifestyle, but she is content. It could be argued that this is because she is younger than other characters explored by Winton however given that Queenie and Cleve are in a healthy marriage and they openly show their pride, care and love towards their daughter, it is clear that Dot will be provided with a more normal, happy life. Every Family is different from the other. Certain are functional and certain are falling apart at the seams. The short stories of Minimum of Two explore this through different experiences and circumstances which directly reflect on how the characters are portrayed. Family is a huge aspect of a person’s identity. Throughout the stories, Winton gives us examples of how the support and love of family are required for one to be fully satisfied with life and truly be aware of their identity. The absence of this supportive, healthy family will most likely outcome in a never-ending negativity for the members within that family. In most instances, the impact of family can either act as a curse that increases one’s isolation and negativity or a blessing that provides a sense of belonging and contentment, not only with the family itself but also with the broader world. Mainly, the stories of Minimum of Two suggest that regardless of being moral or immoral, family shapes oneself.

Star report Essay Example | Topics and Well Written Essays - 750 words - 2

Star report - Essay Example Though it is not as visible from the earth, the Proxima Centauri is the main sequence star. The star is thus the main sequence red dwarf star, and like the sun has a low luminous value compared to the degenerate (white) dwarf stars that run on star remnants. The energy generated by the star (magnetic, X-Rays, and surface flares), is promoted by the thermonuclear fusion of hydrogen not accumulating helium ash at the core. This lengthens the lifespan of the star, which is estimated to be when the star burns through all of its fuel. The Proxima Centauri is the star nearest to the sun. As such, its nomenclature is founded in the distance to the sun. The term Proxima is derived from Latin and translates either as ‘next to’ or ‘nearest to’. It applies to both the sun and the earth, as it is the closest star to the earth after the sun, making the name proper name. Discovered in 1915 by Robert Innes (Scotsman), it is located in the G-cloud in the Centaurus constellation, with an estimated orbital period of more than half a million years (Benedict et al 1086). The myth to the constellation is that it was believed to be a bison-man by the Babylonians, similar to the Greek and Roman concept of the centaur, half horse-man. The star has a visual magnitude of 11.05 and is only visible with the use of visual aids, but its absolute visual magnitude is 15.5. Its invisibility to the naked eye follows the limitation of the eye’s visual magnitude, placed at 6. There are proposals that suggest that the star makes up the triple star system with the A and B Alpha Centauri. Such is part of the binary Alpha Centauri with about 0.237 Â ±0.011 ly (about 15.000 Â ± 700 AU (Astronomical Unit) (Benedict et al 1088). Considering its proximity, the angular diameter (1.02 Â ± 0.08 milliarcsec.), and length from the sun, its diameter has been determined as a seventh that of the sun. With this

Mrketing orienttion in reltion to sles orienttion nd production Essay

Mrketing orienttion in reltion to sles orienttion nd production orienttion - Essay Example Pillsbury on the bsis of vilbility of high-qulity whet nd proximity of wter power. Mjor concern ws with mnufcturing-not mrketing. ccording to compny executive, compny philosophy in the er of mnufcturing dominnce might be stted s follows: "We re professionl flour millers. Blessed with supply of the finest North mericn whet, plenty of wter power, nd excellent milling mchinery, we produce flour of the highest qulity. Our bsic function is to mill high-qulity flour, nd of course (nd lmost incidentlly), we must hire slesmen to sell it, just s we hire ccountnts to keep our books." The second er ws one of sles orienttion. In the 1930's, competition hd become more significnt nd the problems of reching the mrket hd grown much more complex. Compny officils becme somewht wre of consumer wnts nd needs, nd formed commercil reserch deprtment to develop fcts bout mrkets. More ttention ws given to strengthening the distributing orgniztion, consisting of wholesle nd retil grocers. Compny philosophy in this er is described s follows: "We re flour milling compny, mnufcturing number of products for the consumer mrket. We must hve first-rte sles orgniztion which cn dispose of ll the products we cn mke t fvorble price. We must bck up this sles force with consumer dvertising nd mrket intelligence. We wnt our slesmen nd our delers to hve ll the tools they need for moving the output of our plnts to the consumer."third er of mrketing orienttion did not begin until the erly 1950's. The compny hd experienced substntil post-World Wr II sles growth in new products, principlly cke mi xes. It relized tht it could produce hundreds of new products, nd fced the necessity of selecting the best ones. It ws considered essentil to build into the compny orgniztion new function which would coordinte the heretofore seprte compny responsibilities of selling, dvertising, mrketing reserch, nd product plnning, nd provide guidnce for other res. This function ws clled "mrketing," nd mrketing developed the criteri for determining which products to mrket. Emphsis shifted from mnufcturing nd mere sles considertions to determintion of which products would best fit the needs of the compny's customers. Compny policy for the 1950's ws stted s follows: "We mke nd sell products for consumers."mrketing oriented firm is now defined s n "orgniztion culture tht most effectively cretes the necessry behviors for the cretion of superior vlue for buyers nd, thus, superior performnce for the business." (Nrver nd Slter, 1990, p. 21) This definition implies tht the firm needs to understnd buyer nee ds nd competitive cpbilities nd weknesses, nd it needs to perform ctivities gered to chieving superior customer stisfction. The firm's corporte culture is systemticlly committed to creting customer vlue. The rtionle is tht the more compny understnds nd meets the rel needs of its consumers, the more likely it is to hve hppy customers who come bck for more, nd tell their friends. This process cn entil the fostering of long term

1. Review of Diesel 2. Review of Hydrogen Essay

1. Review of Diesel 2. Review of Hydrogen - Essay Example The invention of Diesel was financed by M. A. N. of Augsburg (Mathur and Sharma 2000). Diesel has a boiling range of about 180Â °C to 300Â °C. It is widely used because it is cheap and has better thermal efficiency. Today Diesel is produced in three ways: Petroleum Diesel, Synthetic Diesel and BioDiesel. 1. Petroleum Diesel: Petroleum diesel is also called as Fossil Diesel. This diesel is produced from fractional distillation of crude oil. The supply of petroleum diesel is fast depleting and hence the search for other types is becoming all the more important. 2. Synthetic Diesel: Synthetic diesel is made by processing natural gas through a technology which converts the natural gas into Synthetic Diesel. Synthetic diesel is free from sulphur and provides numerous other environmental benefits over petroleum diesel. Synthetic diesel is cleaner, cleaner-burning and can be formulated for superior cold weather performance. The following diagram shows the emission reductions compared to typical California diesel: 3. Biodiesel: Biodiesel is a renewable diesel fuel substitute. It can be made from a variety of natural oils and fats. Biodiesel is made by chemically combining any natural oil or fat with an alcohol such as methanol or ethanol. Methanol has been the most commonly used alcohol in the commercial production of biodiesel (National Renewable Energy Laboratory, May 1998). The diesel cycle is the theoretical cycle for slow speed compression-ignition or diesel engines. In a diesel cycle the heat is added at constant pressure. The pressure drop at the end of expansion is still at constant volume. This cycle is shown in the following T-s diagram. The process 1-2 is reversible adiabatic (isentropic) compression of air. Heat is then added at constant pressure, represented by 2-3. In actual engine heat addition takes place in the form of injection of fuel which self-ignites due to high temperature caused by high compression

The Strategic Positioning of Lenovo Laptops Essay - 3

The Strategic Positioning of Lenovo Laptops - Essay Example This research will begin with the statement that Lenovo, a Beijing-based company –having the slogan "For those who do" – has inevitably shot to prominence when it accelerated into the global market with IBM's PC business in 2005. The idea that the ThinkPad, treasured of American business people, that would be made by the Chinese company resulted in uneasiness at first; the $1.75bn ( £1.04bn) purchase had attracted extreme regulatory attention. Lenovo Group Ltd, the Chinese multinational computer technology company has its headquarters in Beijing, China and Morrisville, North Carolina, United States has hit the market with very strong securing of market share that has to a greater extent resulted to wake up call upon other competitors in the industry. The stiff competition has been the basis of this research in ensuring how the organization strategically secure and maintain its market niche are relatively remain profitable and grows undisputedly. The critical step in f inding the definition of the strategy of a business is the determination of its strategic positioning – the aspects of how it competes and in serving customers in the markets.  At the core of strategic positioning is the customer attraction, the customers bonding, retention and satisfaction of the customers. The Delta Model helps in providing a roadmap for identifying and analysis of the optimal strategic positioning, from the perspective of achieving customer bonding, and thus provides the three strategic positions for reaching the company’s target objectives.  

Summary Coursework Example | Topics and Well Written Essays - 2000 words

Summary - Coursework Example This being said, Day and Schoemaker (2005) develop a strategic eye exam that will help managers to examine the most problematic strategic areas. First, the authors recommend defining the scope of the company’s peripheral vision. Neither too much nor too little peripheral vision is good for the company: those with too much peripheral vision can end up being too neurotic to deal with change. Second, Day and Schoemaker (2005) proceed to the questions every manager should ask while analyzing companies’ peripheral vision: these questions relate to companies’ past and present, as well as future prospects and ideas. Finally, the authors suggest that the peripheral vision of any company can be strengthened. The article can readily serve the source of valuable advice in the development of useful peripheral vision and thinking within organizations. Day, GS & Schoemaker, PH 2005, ‘Scanning the periphery’, Harvard Business Review, November, pp.135-148. Are You S ure You Have a Strategy? Strategy is a buzzword in contemporary organization studies, but few organizations have a clear understanding of what strategy really means: in this article, Hambrick and Fredrickson (2005) develop a framework for strategy design that includes five basic elements. According to Hambrick and Fredrickson (2005), researchers have developed abundance of various strategic analysis frameworks, but all these frameworks ignore the fundamental question of what strategy is and how it works. As a result, it is not clear how these strategic frameworks should be applied and how they can benefit organizations. In this situation, strategic managers and business owners create confusion and reduce their professional credibility (Hambrick & Fredrickson 2005). This is why the authors of this article propose their vision of strategy and its elements. Based on the article, the main elements of strategy include Arenas, Vehicles, Differentiators, Staging, and Economic Logic. For ea ch element, Hambrick and Fredrickson (2005) provide a question every company should ask in the process of formulating its strategy. For example, in terms of the Arenas element, executives should first decide where exactly, in what arenas, their business will operate (Hambrick & Fredrickson 2005). The substance of any strategy is made of arenas, vehicles, and differentiators, which also require that executives define the main stages of strategy implementation and develop a clear idea of how exactly they want to generate profits (Hambrick & Fredrickson 2005). To support their claims, the authors provide a number of case studies. These case studies illustrate the strengths of the proposed strategy framework. Finally, Hambrick and Fredrickson (2005) conclude that strategy is not about planning but about informed and well-integrated choices and the proposed framework can well serve the basis for the development of the major strategic initiatives. Hambrick, DC & Fredrickson, JW 2005, â₠¬ËœAre you sure you have a strategy?’, Academy of Management Executive, vol.19, no.4, pp.51-62. The Irrational Side of Change Management In this article, the authors identify and discuss nine insights into the way human nature becomes a barrier to implementing the four conditions of behavioral change and fostering positive organizational shifts. Also, the authors show how different companies have succeeded in overcoming these obstacles,

Why student athletes should be drug tested Essay

Why student athletes should be drug tested - Essay Example According to ESPN, the University of Oregon has decided to implement drug tests for its athletes on random basis right after a research conducted by ESPN proved that football teams that play at University level have forty to sixty percent of the total players who are involved in the act of abusing marijuana (ESPN, 2012). Similar kind of random and announced drug activities have been implemented by several universities. These tests have gained immense amount of criticism as these tests have failed to achieve the objective for which these tests were being conducted and have ended up being counter productive. These tests have been criticized because these tests do not reduce drug abuse, these tests can result in loss of trust and these tests are against individual’s constitutional rights. The drug tests conducted on random basis among athletes are conducted because educational institutes believe that these tests will decrease the probability of athletes using drugs and since athl etic students are popular, other students will follow their lead. The universities even believe that students will fear the tests and due to the fear that these results will be informed to parents, athletic students will not abuse drugs. Two studies conducted during 2003 reported that drug tests never reduce consumption of drugs and these tests may lead to increase in consumption.

Two important compensation issues are wage-rate compression Essay Example for Free

Two important compensation issues are wage-rate compression Essay A considerably important issue with gender-related experiences is equal pay for comparable worth. Comparable worth defines the idea that men and women share the same values that should be funded equally in pay. This issue has been created by the idea that jobs performed by women are generally paid less than those performed by men. â€Å"This practice results in what critics term institutionalized sex discrimination. † The issue goes beyond whether a female waitress should be paid the same as a male one. But the tasks involved in any job, should be compared in order to be paid comparably. The differences in these wages occur because of the undervalue mindsight of female-related jobs. The situation set forth involves treating jobs that are somehow equivalent as equal pay opportunities. There is no censusus to evaluate jobs or an agreement on the ability of job evaluation techniques to attempt to solve this gender-related problem. Wage-rate compression is directly related to this concept. A higher rate of pay has people accepting more job-demanding tasks. However, this is being significantly reduced by wage-rate compression. Wage-rate compression is the reduction of differences between classes. For example, the problem begins when people at a company believe their pay is to similar to that of those with lower-level positions. Ultimately, there is no one cause for this concept. Traditionally, this has continued because of union negotiations for higher pay for all salaried positions (of certain value) and management personnel are not usually offered the same negotiations. Identifying these situations is much easier than creating policies to ensure they don’t occur. For example, by giving larger compensation to more senior employees, emphasizing pay-for-performance and merit related tasks, limiting the hiring of new applicants seeking large compensation and providing equity adjustments for selected employees hardest hit by pay compression may all significantly help reduce the impact of this issue.

Genesis Computers: Project Management and Cost Control

Genesis Computers: Project Management and Cost Control Executive Summary Genesis is engaged in supply of PCs to the home market and in development of software. During the past year, project costs of the company have tended to go beyond projections and have become a matter of grave concern. The project management team has been given the task of analysing the situation and devising measures to control costs. This report contains a detailed analysis of the problems facing the company and provides recommendations to bring project costs under control. It is structured into separate sections and after beginning with a small introductory write up, takes up the various factors involved in project cost control, along with recommended measures and suggestions. 1. Introduction Genesis Computers is in the business of selling and maintaining personal computers for home use. The company also develops software solutions for its clients. The customers of the company buy PCs, as well as bespoke software. Clients can be segregated into customers who buy computers, customers who buy software and those who buy both. All customers are provided with free warranty periods for both hardware and software. Many of them prefer to enter into annual maintenance contracts at the end of the warranty period. In consonance with customer expectations, Genesis sells only branded computers. In addition to PCs, some customers also need printers and scanners, which the company provides. As the market of the company is limited to customers who need PCs for home use, the number of computers sold to individual clients remains restricted. Some clients who run small businesses from their homes occasionally place larger orders, along with bespoke software. The company is experiencing overruns in project costs. Cost escalations are occurring regularly in both hardware and software components, with resultant erosions in profitability, delays in project completion and decrease in customer satisfaction. It has now become imperative to ensure that cost budgets are maintained and customer expectations with regard to quality and delivery met appropriately. It is the objective of this assignment to investigate the reasons for cost overruns and develop appropriate measures to control identified problems. Consideration has to be given to the small size of the company. The recommendations should thus be simple, logical and convenient to implement. 2. Cost Overruns Measures to control project costs need to account not only for the costs incurred for procurement of hardware and development of software, but also for those incurred for maintenance and rework during the warranty period. Apart from these expenses, project costs need to incorporate all direct or indirect expenses attributable to the project. As warranty costs for hardware are protected by back to back arrangements with hardware vendors, this assignment will focus on the other cost elements involved in project execution. Cost control must necessarily be a multi disciplinary exercise. This fact needs to be conveyed to all departmental heads and their cooperation obtained. It needs to be recognised that cost reduction exercises that happen without the full cooperation of all departments will probably be stillborn and doomed to failure. a. Estimation and Quotations: In many cases the genesis (!) of cost overruns lies in improper preparation of estimates and quotations. Preparation of estimates is often the preserve of sales and marketing functions. The sales department in Genesis reports directly to the CEO and its eagerness to clinch deals occasionally results in inadequate cost estimation and low quotations. It is recommended that the estimating exercise be converted into a multidisciplinary function for an initial period of six months. During this period managers from projects, procurement, software development, finance and sales departments should take part in the estimation function. Managers drafted for this exercise will need to be informed of the urgency of the exercise, the necessity of carrying out detailed estimation exercises and the need for speed in preparing estimates. It must be ensured that sales response times do not get diluted due to the necessity of carrying out estimation exercises. It is also essential to ensure that the p rocedure for estimation be in line with the methodology used by the company for preparing project budgets. The estimation exercise, while incorporating direct and indirect costs, must provide for accurate forecasting of time required for software development. It needs to be emphasised that most software development costs are functions of time and labour and the underestimation of time is a causal factor behind preparation of incorrect estimates and subsequent overruns. b. Budgeting: The budgeting exercise takes place only after receipt of the order; with budgets sometimes being very different from original estimates. It is important to prepare the budget, de novo, after receipt of the order on the basis of the order specifications for hardware and software. The hardware requirements and prices agreed upon need to be checked with procurement prices to ensure the presence of determined margins. A software development process consists of specific steps e.g. analysis of software, elements, architecture, implementation, testing, documentation, training, support and maintenance. The budgeting process must necessarily account for the time required for separate processes, incorporation of buffers and slacks, application of accurate costing rates and incorporation of other direct and applicable indirect costs, including the apportionment of overheads. c. Supply Chain Management: Efficient control of costs relating to the hardware component in projects will be best served by improving the supply chain management of the machines, peripherals and accessories, traded by the company. Most projects contain both software and hardware elements. As such, they also have a delivery time framework that is in consonance with software development time. This factor, fortunately, provides enough time to the purchase department for procurement of hardware, even after receipt of the order. Genesis must take advantage of this slack in hardware procurement time to ensure minimum stocking and reduced inventory levels. The project managers need to coordinate with the staff of the procurement department and the vendors, thereby ensuring that while low inventories do not lead to delays in receipt of material, ordered supplies are received â€Å"just in time† to ensure timely delivery. Introduction of this practice will lead to reduction in inventory, freeing of inventory car rying costs, more careful buying and sharper project execution practices. d. Project Monitoring and Execution: Improvement in any aspect of project management; be it cost, delivery or quality, essentially starts with project managers. Each order, as soon as it is signed, must be allotted to a suitable project manager. The choice of project managers is important in order to ensure that chosen managers are competent enough to handle allotted projects and moreover, have enough time to devote to the execution of their projects. Overloading project managers or allotting projects to unsuitable managers is the surest way to invite problems in project execution. Improper project management can lead to costs going over budget or to late deliveries, with problems getting compounded when large number of projects come up for parallel execution. There are three basic dimensions to successful project management, control of time, scope and cost. These dimensions work like three sides of a triangle, with a change in any one parameter affecting the other two. Research shows that less than 10 percent of all projects are delivered to their original cost and schedule estimates. One reason associated with this failure rate lies in the tracking of effort and cost – estimates should be tracked over time comparing planned to actual outcomes.(McManus, 2006) Project managers must control the scope and time of the project and ensure that they comply with originally laid out plans. It is generally seen that this approach, if implemented sincerely solves many of the problems that lead to cost overruns. Project managers are responsible for a number of issues, the main ones being planning, designing objectives, controlling risk, estimating and allocating resources, organising work, acquiring resources, assigning and directing activities, controlling execution, monitoring and analysing progress, implementing route corrections, ensuring compliance with cost, time, quality and delivery norms and managing issues. Execution of many software projects also involves the utilisation of outside experts who are paid in line with the time expended by them while working on the project. Outside experts need to be monitored with more care because of their distant location and other commitments. Specific attention needs to be given to monitoring the various phases of different projects. If estimation and budgeting are done with a fair degree of comprehensiveness and accuracy, proper monitoring and route corrections procedures help greatly in keeping projects on track. Project monitoring involves a number of variables. It is recommended, in the first instance, that all mangers use standard software like MS Project to monitor and control projects. In addition to use of standard project monitoring tools, monthly financial reviews also help in controlling project costs. It is recommended that these financial reviews should be regularly held and attended by project managers, finance personnel and the CEO. The focus of these reviews should be on cost and time overruns. These reviews will help enormously, not just in locating reasons for overruns but also in quantifying the costs that remain to be incurred. It is imperative that reporting of costing data, at this stage, should draw only upon the information available within the existing finance function. Changes in systems relating to collecting and recording of costing data should be looked at only after the present recommendations are implemented and followed, for at least one year. It would be premature to do otherwise. 3. Closing Review and Conclusion: The conclusion of any project must necessarily be accompanied by a detailed closing review focussing on time, scope, cost, and customer satisfaction. The review should deal not just with negative variances but also with areas where good project execution practices have been able to achieve savings in time and costs. This will enable project managers to focus and localise practices that have worked favourably during project implementation. The project management team must use these completed reviews as major information sources for designing project cost control measures. They must draw from the lessons learnt and conclusions reached to prepare a detailed manual outlining company practices for monitoring and controlling project costs. The CEO and the finance department should keep the issue of project cost control alive during the year and design a reward system for staff responsible for executing very successful projects. It is suggested that these measures be implemented immediately and quarterly reviews be held thereafter to assess their effectiveness in achieving project cost control. Bibliography Ho, M, 2005, Managing Project Quality: Cost, Control and Justification, DM Review, Retrieved December 23, 2006 from www.dmreview.com/article_sub.cfm?articleID=1040055 Hormozi, A. M., Dube, L. F. (1999). Establishing Project Control: Schedule, Cost, and Quality. SAM Advanced Management Journal, 64(4), 32. Relkin, J, 2006, 10 ways to effectively estimate and control project costs, Tech Republic, Retrieved December 23, 2006 from articles.techrepublic.com.com/5100-10878-6078705.html

Some Reasons For Unhappiness

Some Reasons For Unhappiness The true American dream of the pursuit of happiness might now directly change into the pursuit of material wealth because some people are becoming unhappy. I assume our immeasurable desires make us unhappy. Psychologists define unhappiness as a mental or emotional state of distress that is distinguished by negative or upset emotions fluctuating from contentment to intense misery. I started my journey reasons for unhappiness, by interviewing some Montgomery College students, and I continued interviewing many other people: my friends, co-workers and relatives. Then, I did some research and watched a great documentary film called HAPPY and some more videos from websites to strengthen my case. Next, I examined people different reasons and views for their unhappiness. The first reason is seriousness of their unhappiness. Some people are not happy because they have extra weight on their body, and others are unhappy because they lost someone they deeply love. Also, they have complex reasons from one another. Some people believe they hate their job because they dont have enough money to afford what they want to buy. Others are not happy because they dont have a job. Health is also another concerning reason. Some people are unhappy because they dont have good health and others are not happy because they dont have money to buy cigarettes. After I studied different types of unhappiness, I found out people can become unhappy in two different ways. One way to be unhappy is having bad relationships among families, co-workers and friends. Another way is having personal problem, such as health. There are also several ways to become happy. These can be reading the Holy Bible, traveling aboard and learning about different cultures, creating great social interaction with your neighbors, or building freedom of choices. Introduction Pressures we carried in our lives can produce destinations for our happiness or unhappiness, such as a final exam for a student, an interview for a job seeker, an experiment for a scientist, or a touchdown for a football player. These conditions are major deciders for our happiness or sadness. Even though it is obvious that every one of us seek a single outcome -joy, there are still many reasons for unhappiness. I believe our happiness can be achieved by feasible dreams or heart desires, but not unobtainable dreams that put us into miserable situations. My assumption is limitless desires for everything we could ask for and even more have made us to not appreciate life and to no be happy. During my study, I found several reasons and research papers about unhappiness, but I mainly focused the dimension, complexity or differentiate, and unhealthiness of unhappiness to support my hypothesis. In this trying research, my goal is study the danger of unhappiness and its consequences and to find recommendations that fulfill a person life with full of happiness. In addition, the purpose of this report is to scrutinize or avoid our unhappiness because I believe it may cause demise. I have included some people life experiences and interviews and expert analyses. Methods According to Ian Sample article, How to be happy? the Guardian newspaper in November 2003, most of us are born with a certain amount of happiness, and our happiness is a best way to achieve our goals. However, unhappiness has been an endless problem for most individuals. Thus, I started by interviewing to proof my assumption. I interviewed some Montgomery Community College students, my friends, my families, and my co-workers, and all the interviews was fun, and besides it helped me to get supportive evidences. After I had numerous interviews, I watched a one and half hour documentary film called HAPPY, directed and written by Roko Belic, on Netflix. The documentary has an extraordinary journey from small town India to the modern city Japan in pursuit of happiness. Also, it has actual life stories of individuals from around the world and influential interviews with some top experts and scientists. It also explores the secrets behind our most valued emotion, happiness. I watched the documentary many times, and I carefully took a note about why people are happy or unhappy. Next, I composed some information about happiness from different website articles, such as the Guardian daily newspaper. In addition, I watched several videos, on TED.com, about happiness and unhappiness, which help me to prove my hypothesis come up with strong conclusion and recommendation. Results Depths of unhappiness Nancy Etcoff, a professor of the science of Happiness at Harvard university, in her talk, Happiness and its Surprises on ted.com, explained that humans are very sensitive of negative things; hence, they can easily be unhappy. During my study, I mainly focused on the profundity of unhappiness because some people unhappiness was a slight lower-amid gloom. For instance, they were unhappy because they got a parking ticket while parking in No Parking! areas. I tried to avoid this common and ordinary unhappiness, which have easy solutions. For instance, if someone is unhappy about his weight, he can exercise. Also, it was pretty difficulty for me to record consultations about unhappiness. While I was fully concerning to get a negative life experience, some people I interviewed were giving me a commonplace sadness because they concerned about protecting their depressed stories. In general, the majority of my interviewer stories were very common unhappiness. They were simply unhappy in particular situations and overlooked it right away. However, some have emotionally wounded for long period of time, which allowed me to see how unhappiness deeply affected people lives. One of my good friends told me about his agonizing marriage story, and how it affected his life. He told me that he found his wife cheating; however, he has been willing to keep his relationship for the sake of his children. Even though he is still unhappy about it, he mentioned that he fears if he wanted a divorce, he will lose his children. As a result, he chooses to be unhappy and lives with his children than getting divorce. Complexity of unhappiness In my study, I also found that unhappiness can have a different involvedness between ages and situations. For instance, My nephew, age 10, want to play game during weekend if he didnt allowed to play a video game in weekends, he would be unhappy. And, some college students believe that they are not happy because of some bad professors. Their repulsions are even though they have a good or bad grade, they are not happy by the way they are learning in some classes. However, some other college students have different ideas, they believe that the reason why college students are unhappy because of stressful college course, which has various pressures and expectation, and most time these prevent students to earn good grades. Also, my co-workers have different explanation for their unhappiness. Most of my co-workers think they are not happy because of low payment in the company. In contrast, my unemployed friends feel miserable because they couldnt find a job. How unhappiness impact a person health? During my interviews, some people give me feedback of unhappiness concerning to heath. They said that when they feel like there are too many pressures or demands on them, they become stressful. For instance, when they are worrying about tests and schoolwork, they might lose sleep. When they have busy schedules, they might eat on the run. Also, everyone experiences stress at times; adults, teens, and even kids, but there are ways to minimize or to manage those health problems. However, not like the following story. Markus, my co-worker in JCP, told me a poignant story of his ex-girlfriend. He told me that his ex-girlfriend became drug addicted because she was unhappy in her life. When she took drugs, she felt false happy. Thus, she continued to use drugs because if she didnt take drugs, she believed she would have a stressful day. Markus was unhappy by her situation and he tried to stop her for several months. However, she couldnt listen to him. Finally, she ended up death while taking drugs. Discussion During my study of reasons for unhappiness, I found out about two ways of unhappiness which support my hypothesis: one there is dependent unhappiness, and there is independent unhappiness. Dependent unhappiness is unhappiness that we feel when we lost what we had. For instance, if suppose we keep expecting from others: friends and co-workers including our relatives, we finally end up unhappy because people are capable of making mistake. Daniel Kahneman on his talks, The Riddle of experience vs. memory on ted.com, explained even though every one of us want to make happy one and another, still people are becoming unhappy because what other people did to them. Independent unhappiness is melancholies that happen when we have desire that has never-ending. For instance, when we comparing ourselves to others. When we want more of something things weather it is bad or good. We are not pretty skillful about thinking quickly before we act, so we need not be disgraceful about our own deeds. If we can solve problems in our life then there is no need of worry, but we still deeply stressed and become unhappy plus hurt our health with the thing we cant solve. During my studies, I have perceived whether it is dependent or independent unhappiness, people are becoming unhappy because they dont have a limit for things. Most of our unhappiness came from the unrestricted desire of achievements. We should have to know our capabilities and potential what wed, and has to keep little expectations from others as much little as possible also from ourselves. Even though our unhappiness is bring those various types of problems and different reasons. Some reasons are depth and some are easy, and some reasons are complex and have health issues. Recommendation to become happy They are many recommendations for our unhappiness. J.D. Roth, a founder of award-winning website Get Rich Slowly, in his article, The Psychology of Happiness: 13 Steps to a Better Life, on GetRichSlowly.org, has recommended how to avoid unlimited desires and some step for a better life. Also, he mentioned that people should not compare physically or socially to one another, and to focus to their personal goals. In addition, getting away of unhappiness might have different recommendations, but all have the same impact, which is becoming happy again. No one ever found happiness alone, gazing at his navel. Happiness is not personal. It is relational. If we improve our relationships, we will surely boost our happiness. Thus, traveling aboard and exploring new things, becoming closely connected or associated with neighborhoods are some of freedom of choice: doing what someone loves to do and knowing limitation: avoiding life pressures can help us to get away from unhappiness. Work cited: Sample, Ian. How to Be Happy. The Guardian. Guardian News and Media, 19 Nov. 2003. Web. 25 Nov. 2012. . The Psychology of Happiness: 13 Steps to a Better Life. Get Rich Slowly à ¢Ã¢â€š ¬Ã¢â‚¬Å" Personal Finance That Makes Sense. N.p., n.d. Web. 25 Nov. 2012. . Nancy Etcoff: Happiness and Its Surprises. TED: Ideas worth Spreading. N.p., n.d. Web. 25 Nov. 2012. . 2005, World Values Survey. Happiness Net Statistics Countries Compared. NationMaster.com. NationMaster, n.d. Web. 25 Nov. 2012. . Daniel Kahneman: The Riddle of Experience vs. Memory. TED: Ideas worth Spreading. N.p., n.d. Web. 25 Nov. 2012. . Happy. IMDb. IMDb.com, n.d. Web. 08 Dec. 2012

Group Dynamics in 12 Angry Men Essay -- Movie, Film, Twelve Angry Men

In the 1957 classic 12 Angry Men, group dynamics are portrayed through a jury deliberation. Group dynamics is concerned with the structure and functioning of groups as well as the different types of roles each character plays. In the film, twelve men are brought together in a room to decide whether a boy is guilty of killing his father. The personality conflicts, the joint effort and the functioning of several minds together to search for the truth are just a few characteristics of group dynamics at work. The whole spectrum of humanity is represented in this movie, from the bigotry of Juror No.10 to the coldly analytical No.4. Whether they brought good or bad qualities to the jury room, they all affected the outcome. At the outset, eleven jurors vote in favor of convicting the accused without even discussing a single shred of the evidence presented at the trial. When a group becomes too confident and fails to think realistically about its task, groupthink can occur. Since it takes a longer time to communicate and reach a consensus in a group, decision making in a group is time-consuming. Therefore, when groups want to achieve a quick decision, as several jurors were eager to do, they make riskier decisions than individuals. Since not any individual is completely accountable for the decision, members will have a tendency to accept more extreme solutions. Only one brave juror refused to vote guilty. Juror #8 refused to fall into the groupthink trap and ultimately saved an innocent man's life. He openly admits that he does not know whether the accused is guilty or innocent and that he finds it necessary to simply talk about the case. What follows is not only a discussion of the particular facts of t he case, but also an intense ex... ...quires looking at matters objectively, analyzing the evidence, and coming to a fair conclusion. And even if the juror's personal baggage was not checked at the door, the shift into positive group dynamics allowed the jury members to overcome interpersonal conflicts and prejudices to reach consensus on the innocence of an alleged murderer. Bibliography 1. Kolb, David A., and Joyce S. Osland and Irwin Mr. Rubin. Organizational Behavior: An Experiential Approach. 6th edition. New Jersey: Prentice Hall, 1995 Pages 98-100 2. Sarah Trenholm. Thinking Through Communication: An Introduction To The Study Of Human Communication. 2nd edition. Allyn and Bacon: A Viacom Company, 1995 Pages 196 - 205 3. Damian Cannon, a review by. '12 Angry Men (1957)' Copyright Movie Reviews UK 1997 4. Steve Rhodes, a review by. '12 Angry Men (1957)' Copyright 1997 Steve Rhodes

Industrial Music :: essays research papers

Industrial Music Rock and roll is dead. It's a fact. During the eighties romp of techno and fashion bands, people forgot all about it. In the late eighties and early nineties alternative music tried to save rock and roll, but it was too big of a category. If a band didn't sing country or rap, they were considered alternative. Every alternative band had their own idea of music, and it all spread apart, running farther away from rock. Finally, when alternative became more defined and broke off into categories, one specific type of alternative offspring, industrial music, made the best attempt in a decade to revive the long forgotten era of rock and roll. The only problem with this new rock is that it was angered from being forgotten for over a decade and now it's back, filled with angst and hatred. Industrial music has weaved rock and roll with evil and misery. The founder and leader of the industrial revolution is the band Nine Inch Nails. Most people do not classify Nine Inch Nails as a band though. The writer, producer, lead vocalist, keyboarder and guitarist of the band is Trent Reznor. For the past two years, Trent has been the artist of the year in Spin magazine and NIN has been the number two band of the year. In 1994, Nine Inch Nails was announced MTV's band of the year. This was a great honor because MTV spends most of it's time with rap and hip-hop. When NIN's first album came out in 1989, it was mostly rock and roll with a techno twist, containing songs full of depressing, suicidal lyrics. Then as the next two albums arose, Trent became more evil with his music, using machines and pretty much anything he could find that would make his music sound angered and irritated. This hard, twisted music, backed up by words of pure hatred started the industrial ball rolling.   Ã‚  Ã‚  Ã‚  Ã‚  One band that has tried to lighten up industrial just a tad is KMFDM, a German industrial band. The band name stands for Klein Mitlied Fuhr Das Merhiet, which is Little pity for the tyranny. Instead of using the suicidal, evil lyrics, KMFDM has used their music as more of a philosophical communication. They sing about how screwed up they think the world is and how much we are controlled by people we didn't know existed. The lyrics may sound depressing still, but the music is a little more upbeat. KMFDM got rid of the tortured machine sounds and added horns and synthesizers, making the music sound more digital and less like grinding gears.

Women Entrepreneurs

WOMEN ENTREPRENEURS: Women entrepreneurs may be defined as a woman or a group of women who initiate, organize and run a business enterprise. In terms of Schumpeterian concept of innovative entrepreneurs, women who innovate, initiate or adopt a business activity are called business entrepreneur. It is the group of women or single women running an enterprise or company in order to earn profit. Now days because of  Ã‚   women empowerment women are stepping-stone into the industries and are taking the place of men. Now a day's women's are running several business like beauty parlours, switching shops, boutiques, etc.The areas chosen by women are retail trade,  restaurants, hotels, education, cultural,   cleaning insurance and manufacturing. Women entrepreneurs have been making a significant impact in all segments of the economy in Canada, Great Britain, Germany Australia and US. Till the turn of the century, man has enjoyed a dominant position. But change in position technological innovation and modern way of thinking can reduce the disparity between man and women, and bring about equality and equity between them, the need of the hour in women empowerment both through provision of employment and enterprise creation.The Government of India has defined women entrepreneurs based on women participation in equity and employment of a business enterprise. Accordingly, a woman entrepreneur is defined as an enterprise owned and controlled by a woman having a minimum financial interest of 51% of the capital and giving at least 51% of the employment generated in the enterprise to a woman. They have made their mark in business because of the following reasons: * They want to improve their mettle in innovation and competitive jobs. * They want the change to control the balance between their families and responsibility and their business levels. They want new challenges and opportunities for self fulfilment. Role of women as an Entrepreneur's: 1) Imaginative: It refers to the imaginative approach or original ideas with competitive market. Well-planned approach is needed to examine the existing situation and to identify the entrepreneurial opportunities. It further implies that women entrepreneur's have association with knowledgeable people and contracting the right organization offering support and services. 2) Attribute to work hard: Enterprising women have further ability to work hard. The imaginative ideas have to come to a fair play.Hard work is needed to build up an enterprise.. 3) Persistence:  Women entrepreneurs must have an intention to fulfill their dreams. They have to make a dream transferred into an idea enterprise; Studies show that successful women work hard. 4) Ability and desire to take risk  the desire refers to the willingness to take risk and ability to the proficiency in planning making forecast estimates and calculations. 5) Profit earning capacity:  Ã‚  she should have a capacity to get maximum return out of invested capi tal. A Woman entrepreneur has also to perform all the functions involved in establishing an enterprise.These include idea generation, and screening, determination of objectives, project preparation, product analysis, determination of forms of business organization, completion of formal activities,   raising funds,   procuring men machine materials and operations of business. Fredrick Harbiscon, has enumerated the following five functions   of a women entrepreneur's : * Exploration of the prospects of starting a new business enterprise. * Undertaking a risk and handling of economic uncertainties involved in business. * Introduction of innovations, imitations of innovations. * Co ordination, administration and control. Supervision and leadership. In nutshell, women entrepreneur are those women who think of a business enterprise,   initiate it organize and combine the factors of production, operate the enterprise,   undertake risk   and handle economic uncertainties involve d in running a business enterprise The role of women entrepreneur in economic development is inevitable. Nowadays, women enter not only in selected professions but also in professions like trade, industry and engineering. Women are also willing to take up business and contribute to the nation's growth. This role is also eing recognized and steps are being taken to promote women entrepreneurship The concept of Women Entrepreneurs may be defined as women or group of women who initiate, organize and run a business enterprise. Women owned businesses are highly increasing in the economies of almost all countries. Women's empowerment in India is still an illusion. Empowering women entrepreneurs is essential for achieving the goals of sustainable development. The government of India safeguards the interests of women authorizer to bring the effective implementation and utilization of social economic and political status of women in India.In order to face the problems faced by women entrepre neurs, the Government of India launched the scheme Trade Related Entrepreneurship Assistance and Development of Women (TREAD). The main objective of the scheme is to empower women through development of their entrepreneurial skills by eliminating constraints faced by them in their sphere of trade. This assistance is to be provided for self-employment ventures by women pursuing any kind of non-farm activity. Promoting entrepreneurship among women is certainly a shortcut to rapid economic growth and development.A successful woman entrepreneur has the attitude and the inner drive to change her dream and her vision to reality. A successful woman entrepreneur should be given proper empowerment that will increase her success with the society. SOCIAL SCHEMES:Women entrepreneurs have achieved remarkable success. The Micro, Small ; Medium Enterprises Development Organisation (MSME-DO), the various State Small Industries Development Corporations (SSIDCs), the nationalised banks and even NGOs are conducting various programmes including Entrepreneurship Development Programmes (EDPs).To cater to the needs of potential women entrepreneurs, who may not have adequate educational background and skills, MSME-DO has introduced process/product oriented EDPs in areas like TV repairing, printed circuit boards, leather goods, screen printing etc. A special prize to â€Å"Outstanding Women Entrepreneur† of the year is being given to recognise achievements made by and to provide incentives to women entrepreneurs. The Office of DC (MSME) has also opened a Women Cell to provide coordination and assistance to women entrepreneurs facing specific problems. There are also several other schemes of the government like the * Income Generating Scheme implemented by the Department of Women and Child Development, which provides assistance for setting up training-cum-income generating activities for needy women to make them economically independent. * The Small Industries Development Bank o f India (SIDBI) has been implementing two special schemes for women namely Mahila Udyam Nidhi which is an exclusive scheme for providing equity to women entrepreneurs and the Mahila Vikas Nidhi which offers developmental assistance for pursuit of income generating activities to women.The SIDBI has also taken initiative to set up an informal channel for credit needs on soft terms giving special emphasis to women. Over and above this, SIDBI also provides training for credit utilisation as also credit delivery skills for the executives of voluntary organisations working for women. * Grant for setting up a production unit is also available under Socio-Economic Programme of Central Social Welfare Board. |

International Trade Theory and Policy Essay

Multilateral trade negotiations forums are organizations established to regulate trade between many countries of the world. The agreement involves establishing organizations which regulate trade in the entire world. The increase in globalization has forced many countries to form regulatory organizations to avoid bad trade practices. To enhance trade many countries have created trade agreements to remove barriers to trade. Economic integration is the most important aspect discussed by the trade agreement organizations. The organizations aim at achieving an integrated economy where countries can trade with each other. After the World War II many leaders of the world felt that the economies of the destroyed countries could only be improved through trade. One of the proposals to improve trade was to create a laissez-faire global economy but this was rejected since it was not applicable. The leaders agreed to establish global trade organizations which would enhance trade by reducing the barriers to trade which had been placed by the countries. During the war many countries created strict barriers to trade to protect their economies from external influence (Anderson, 2005). The General Agreement on Trade and Tariffs was the first agreement to be established. The agreement was established to enhance trade between the member countries but was later converted into World Trade Organization (WTO). The International Monetary Fund was also created to regulate the economic status of the developing nations as well as regulate international economic activities (Smith, Sumner & Rosson, n. d. ). Reconstruction of the damaged economies after the World War II was the priority of these organizations. For many years several amendments have been made to accommodate the changing economic climate. Trade liberalization has been the most important aspect during the amendments. For example, according to Anderson. (2005, pg. 414), â€Å"the Uruguay Round of multilateral trade negotiations led to agreements signed in 1994 that contributed to trade liberalization over the subsequent 10 years. † Despite the many advantages accompanied by the establishment of the international trade organizations, there have been several disadvantages accompanied by the activities of opening up of domestic markets to international trade. An example is the global economic recession of the 2007-2009 that was experienced by the world economies after the banking industry and the mortgage industry collapsed due to poor financial practices by the U. S. banks. Importance of multilateral trade institutions The multilateral trade organizations were created to enhance trade and stability of the economies of the member countries. Initially they were established to reconstruct the economies which had been destroyed during the World War II. Many countries realized the importance of trade in improving the economies after the war. Trade was the only tool that could restore the original status of the economies. Before and during the war many countries had put a lot of trade barriers to prevent trade with other countries. Opening up domestic economies required negotiations with all countries of the world to enhance a more open economic system (Warnke, 1996). Multilateral trade institutions improve international trade since they encourage member countries to open up their domestic markets to international trade. Trade disputes are resolved more easily between and among conflicting countries, hence leading to a good relationship between countries. Production according to comparative advantage has been encouraged by the improvement in international trade. Countries are encouraged to produce goods which they can produce most economically. Different countries have different resources which give them the potential to create income generating products. Through international trade resources are utilized optimally since an economy will specialize in the production of products which it has greater advantages (Bernard et al. 2007). International trade has encouraged countries to specialize in the production of goods and services. The mobility of factors of production has been accelerated by globalization. More industries are encouraging division of labor to increase the productivity of labor factors of production. More industries have developed with the expansion of international trade. These industries create more employment opportunities to the citizens of a country. As the par capita income of the people increases their living standards is improved. Poverty alleviation campaigns have encouraged improved international trade as one of the strategies to enhance development of nations (Bernard et al. 2007). Opening up the domestic market to international trade creates more advantages than disadvantages. The international prices are lower than the domestic prices. The consumers obtain goods and services at lower prices. The competition created by the international trade encourages the domestic firms to be efficient in their production systems. The customers are provided with a wide variety of products to select from (Bernard et al. 2007). Multilateral trade organizations control the globalization of economies. Globalization refers to the international operation of business activities and the transfer of information between countries. Globalization has affected business activities both positively and negatively. Global markets have emerged and many companies are operating in several countries. This has created competitiveness of the companies since the global markets are larger than regional markets. Globalization is the process of integrating the global economies, societies and cultures by connecting communication and trade networks. Economic globalization refers to the integration of global economies by enhancing trade, foreign direct investment, sharing of technology, movement of people and flow of capital. The factors which influence the rate of globalization are the world economies, technology, and socio-cultural, political and biological aspects (Warnke, 1996). Globalization has improved the exchange of technologies and knowledge. This has increased the capacity of businesses to expand on the number of innovative products in the market. The public sector alone cannot accommodate all the skilled labor in a country and trade provides more employment opportunities for the people in a nation. As economies become more global people with skills can move to countries where there is high market potential for their labor. The introduction of internet has increased efficiency in trade by enabling people transfer information more easily. Trade attracts private investment and this generates more capital in the economy. The gross domestic product of a country increases with increase in trade. Growth and development of an economic is accelerated by trade since more income is generated and the living standards of the people are improved (Daniels, Radebaugh & Sullivan, 2007). Poverty levels in both developing and developed countries have declined by greater margins due to participation of countries in the international trade. Economies have acquired more wealth and the gross domestic product of countries has improved. WTO has become the custodian of international law on trade. The enforcement of trade laws about good trade practices has been possible after the creation of WTO. The establishment of regional and multilateral trade agreements was experienced after WTO was created. This has encouraged many countries remove barriers to trade (World Trade Organization 2010). Weaknesses of multilateral trade institutions Most of the multilateral trade organizations are affected by the political climate in the member countries. Any political war between the member countries can ruin the operation of the organizations. When the organizations support some political organizations; they affect the interests of the members and this reduces the delivery of the required obligations. Politically strong countries have dominated the operations of the multilateral organizations and this is causing a lot of concern to the global trade communities. Decision making at the trade organizations has become very difficult since many participants are not willing to accept rules which affect their economies negatively. Anderson (2005, pg. 417) suggests that â€Å"although trade can and should play an important role in allowing developing countries to lift themselves out of poverty, in reality international trade agreements and institutions have more often than not contributed to the continuation of global social and economic injustice. â€Å" The developed nations have dominated the multilateral trade organizations. For example, according to Anderson (2005, pg. 31) â€Å"with decision-making based on a consensus system, so each member has equal decision-making power, the WTO is held to be the most democratic of all the international institutions with a global mandate. In practice, however, the working methods of the WTO lack transparency, inclusiveness and equity. † There have been conflicts as the developing nations are becoming concerned about the great influence the developed nations have on the decisions in these organizations. Multilateral trade agreements are complicated to establish since many countries are involved. The interests of each country should be represented during the negotiations to ensure that conflicts do not arise afterwards (Amadeo, 2010). Despite the establishment of the trade organizations many countries continue to place more trade discrimination measures upon other countries. â€Å"They include not just trade taxes-cum-subsidies but also contingent protection measures such as anti-dumping, regulatory standards that can be technical barriers to trade, and domestic production subsidies† Anderson (2005, pg. 415). Many trade distortions have occurred since the global economies were established. Multilateral trade organizations have encouraged the opening up of economies to international market influence. The opening up of domestic markets has affected the global economies. Several disadvantages have been accompanied by the opening up of the domestic markets, for example, the global economic meltdown of the 2007-2008. The crisis started with the rise in prices for basic products due to the international increase in fuel prices. The prices of oil and food products increased within a short duration leading to an economic crisis which affected many people in US. The prices for many products increased and inflation was experienced all over the country. Many subprime borrowers had low incomes and the rise in prices for basic products increased the expenses for their living. Many companies retrenched employees to accommodate the increasing production costs. The borrowers were unable to repay the loans resulting to massive defaults. More than 100 subprime mortgage intermediaries filed for bankruptcy. Reacquisition of the houses from the defaulters caused a lot of people to become homeless (Platt, 2008). Subprime mortgages are policies which have a high risk of default. Subprime borrowers are the people with low incomes and have a poor credit history. They have higher risk of default compared to the prime borrowers. The US government had deregulated the real estate mortgages leading to massive investment in subprime mortgages. This caused the risky lending of subprime mortgages. The subprime mortgages were not popular initially but they became widely used in the 1990s. The climax of the sub prime mortgages was in 2006 when they accounted for more than 21 percent of all mortgages traded in the US market. The value of subprime mortgages in 2006 was valued at $600 billion. Many subprime mortgage intermediaries were established to reap the benefits of the expanding industry (Helleiner, 2009). The world economies have experienced a major decline due to poor performance of many industries. This is a crisis which has affected all sectors of the economy. Williams (2009) claims that the crisis was initiated by the subprime mortgage lending crisis in US. The banking sector issued many loans to subprime mortgage intermediaries. Due to the expanding market in the sub prime mortgage market many banks issued unsecured loans to the intermediaries. The climax of the boom was reached in 2007 when the prices of products started to increase and many subprime mortgage lenders were unable to repay their loans. This led to massive default of debts and banks registered huge losses. This reduced the lending capacity of many banks. The resulting effect was lack of credit in the economy and the collapse of many companies (Stapledon, 2009). The government of US is to be blame for the crisis. The 102nd Congress under the leadership of George W. Bush deregulated the housing sector in 1992 (Guttmann, 1994). The main aim was to increase the availability of money for buying housing. Fannie Mae and Freddie Mac companies were deregulated and could spend $97. 50 to buy housing loans. Banks with $100 could spend more than $90 buying mortgage loans. The companies had been ordered by the congress to retain more capital to for risk allowance but this was not practiced. Since 1992 the mortgage sector experienced the highest boom with many companies investing heavily in the sector. Subprime mortgage intermediary companies were developed to assist homeowners acquire loans from the banks (Stapledon, 2009). The banking sector was the worse hit by the crisis. Inter-bank lending declined and banks had no money to issue to their customers. Most of the banks collapsed while others registered huge losses. This was as a result of failure by many subprime mortgage intermediaries which defaulted the huge loans they had acquired from the banks. The central bank could not lead to all the banks due to the massive crisis that affected the entire country. Since US is a market for many commodities from other countries there was an extension of the crisis to other economies causing a global economic meltdown. Many economies declined since they had no market for their goods. Inflation increased as prices persistently increased. The entire world encountered economic crisis which resulted into failure by all sectors of the economy in the world (Stapledon, 2009). Many international organizations have intervened to eradicate the problem. The intervention by the World Bank has created better results in the efforts to reduce the impacts of the crisis. World Bank has issued loans to many countries to increase the income levels of the people. Many companies have been able to access loans due to the fun ding by World Bank. The availability of loans has increased since last year and many companies have regained their capacity (Bayne, 2008). The World Trade Organization has negotiated with the oil producing countries to reduce the oil prices as one of the measures to reduce the effects of the crisis. The global oil prices increased causing the prices of many products to rise. The high product prices caused inflation in the whole world. WTO has also encouraged trade by persuading some countries remove the trade barriers they had placed upon their trade partners when the crisis was at the climax (Stephen, T. 2008).