...people invest and bear the risk of loss. It is also evident that Scripture established a pattern of risk and reward. The gospel of Matthew verses 14-30 records the Biblical principles of investing. Known as the Parable of the Talents, this portion of scripture tells the story of three individuals endued with five, two, and, one talent respectively. Those that received five and two talents invested the talents and reaped rewards from their endeavors. The master in the parable commends those who ventured out in business and took risks. Likewise, the one talent servant who was afraid and hid the talent is characterized as slothful and chastised harshly by the Master. It is evident from this parable that the Master seeks gains on His investment. At a minimum it is expected that resources would gain a rate of interest consistent with low-risk investment. The master reproves the one-talent servant for not at least gaining nominal interest returns on the resources entrusted to him. The parable reveals the Master’s pleasure in those who would venture and risk for the prospect of returns. Scripture also points to a basic principle of investing in regard to the level of risk and the rate of return. Investing involves risk. In order to reap the gains associated with investment growth, financiers must be willing to bear substantial risks. Penman (2011) explains the relationship between risk and return noting the ever-present tension between payoffs and there risk. While expectations of...
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...Risk Versus Reward: The Continuing Vaccination Question As young Americans living in the twenty first century, vaccines have always had a place in our lives. It is taught to us at a young age that vaccines are not only beneficial but necessary to the pursuit of healthy and long lives. For decades, we have been giving vaccines to ourselves and our children without question because the doctors say we should and they have the education, not us. The number of vaccines that children are mandated to receive continues to rise at an alarming rate. Currently, children receive approximately fourteen different vaccinations before the age of two Many of these vaccinations require multiple inoculations, which often have a child receiving four more shots in a single visit (Akinsanya-Beysolow). Every year, more vaccines are added to the list. With the speed of vaccine approval, it is time to step back and reevaluate who is making these recommendations and for what reasons. The cost to vaccinate a child from birth to eighteen has risen from one hundred dollars in1986 to $2,192 (Rosenthal). Vaccine manufacturing is a huge business with a vested interest in mandating vaccines. The decision to vaccinate should be left to the patient and parents, not the government or vaccine manufacturers. Data shows that even before vaccines most of the diseases we vaccinate for were on the decline (Obomsawin). Childhood illness rates have been on a steady increase over the last few decades. As the childhood...
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...very accurate statement, taking risks is a part of life as people go from day to day. If a person doesn’t make the best of life everyday, things just drag on and never seem to end. Those that take gambles and excite themselves in new and spontaneous ways are the only ones that can hope to break away from this. Many people tend to avoid risks and believe that risk taking is something they should not do merely because it could end with negative consequences; consequences that are almost always exaggerated a great deal. In Shakespeare’s Macbeth, the protagonist Macbeth made many decisions to achieve his deepest and darkest desire which was to become king. In order to take a hold of what he wanted he took many huge risks, and in taking those risks he achieved his goal. David Baldacci’s Memory Man and “To Risk” by William Arthur Ward are both works of literature about taking risks, if no risks are taken then no ground can be gained and no rewards can be reaped. Through the rewards of taking a risk, the motivations behind risk taking, and the importance of taking a risk, these works of literature show that in order to achieve a goal, a risk must be taken. Very seldom do people think of the rewards of taking risks and just wallow in the aspects of what could go wrong however, risks need to be taken in order to achieve progress in life. The novel Memory Man was about taking a risk in order to achieve a goal. The protagonist of Memory Man took a risk by walking into his old police precinct...
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...arrangement, all or most of the credit risk remains with the entity. Such an arrangement will almost always fail the risks and rewards tests (and possibly others). It should therefore be accounted for as a loan. By contrast, a "without recourse" arrangement transfers all or most of the credit risk to the factor (transferee). Such an arrangement is likely to qualify for de-recognition (subject to an evaluation of other risks that might be relevant such as slow payment risk). In substance, such an arrangement could be economically similar to a sale of the receivables in which case it is accounted for accordingly. The continuing involvement accounting requirements of IAS 39 will rarely apply in most factoring arrangements because most arrangements result in substantially all the risks and rewards being either transferred or retained. These requirements include special rules on recording and measuring continuing involvement assets and liabilities that deviate from the normal requirements of IAS 39. Accounting Implications When an entity factors its trade receivables, an analysis should be carried out to determine whether or not the receivables should be "de-recognised" (ie removed from the entity's statement of financial position). This analysis should be based on the entire arrangement, including any guarantees or other recourse arrangements. An unconditional sale of receivables will result in de-recognition because all the risks and rewards are transferred (AASB 9.AG39(a))...
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...Do you think that doing something risky or for a title or personal achievement is worth it? To me personally, I believe that the reward is not worth the risk because the risks usually way out the rewards. Although the move is bold, it usually has the risks of hurting yourself or even death. Back in 2010, a 16 year old girl tried to break the record for being the youngest person to sail across the world, by herself. Abby’s reward of this would be that she is the new record holder of this, but her risks are that she could get hurt, die, or ruin her boat. I would have to say that getting a fancy name or plaque is not worth the risks of dying, getting hurt, or ruining your boat. In the text, “Ship of Fools” it claims, “Here's a proposed rule of thumb: any record that requires more than 10 syllables to explain does not need to be broken.” It is saying that all of these records with very long requirements and parts are dumb and don’t need to be messes with, especially if the risks are life threatening. I have to agree with this...
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...Guillermo Furniture Store Finance Concepts July 2, 2011 FIN/571 Guillermo Furniture Store Finance Concepts The risks associated with financial concepts in the case of Guillermo Furniture raises when a company considers joining forces with another company. In such a case with Guillermo Furniture, trying to forecast future purchasing of materials is more difficult because the chance for over purchasing may come into play if the company does go the route to sell itself to a competitor. The questions that come to the forefront is whether the merger will pick up what the other company has on hand. Risks vs. Reward Guillermo Furniture having been approached by a competitor about joining forces brings into play the idea of risk vs. reward. Guillermo Furniture has thought about selling the company or maybe closing the business and possibly merging with the competition. Should Guillermo Furniture do any of the above, what are the risks vs. reward in any of these options? Using information obtained from the sales forecast is used to create the sales budget. “This budget is a result of decisions to create the conditions that will generate a desired level of sales.”(Horngren, 2008). Managers usually take into consideration a number of factors when examining risks for their company. These factors can be looked upon as risks for the company as well. Some of the factors include reviewing past patterns of sales which can be used to help with predicting future...
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...to introducing GenMax’s subsidiary, Aero Motors to the North American Market. The first option is the go-it-alone strategy in which we will attempt to penetrate the market with our own brand. The second option is to partner with a local company which will minimize the risk and enable Aero Motors to leverage the partner’s infrastructure and favorable brand image. After much consideration, it is evident that there are advantages and disadvantages to each alternative. Below I have delineated each option based on the risks and rewards and as it relates to effective use of our brand followed my recommendations. Go-It-Alone: Risk and Reward This strategy can bring a lot of reward if the project is a success, because GenMax will be able to capture all the profits and other possible benefits such as newly earned brand recognition. Additionally, GenMax will be able to take advantage of the two years before the competitors can utilize the new technology allowing for greater profitability. Lastly, by utilizing a go-it-alone strategy, Aero Motors will enjoy the autonomy to make decisions without having to wait for the partner to agree or compromise. While those rewards appear to be favorable, there are also risks that should be considered. In utilizing the go-it-alone strategy one must take into account the limited or even non-existent brand perception Aero Motors and GenMax have in the North American market. It must be considered because the lack of brand equity can influence...
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...program should be implemented. System Requirements The frequent shopper program falls under two departments; Sales and Marketing and Human Resources. Sales and marketing will determine promotions regarding the rewards and track customers usage. Sales and marketing will handle research for the programs as well; initial research, evaluation and refining the program will all be under the sales and marketing department. Human resources become involved ensuring all employees are scheduled for proper training. Each employee will undergo training for promoting the program, answering customer questions and ensuring the customer is receiving credits for each eligible purchase. Legal and Ethical Requirements The legal department will research the laws governing these types of programs in the area. The areas that require research are as follows; privacy, regulations regarding rewards, restrictions and fraud risks. Customer privacy is not only an ethical issue it is also a legal issue. Tracking individual customer activity and contacting can be viewed as unethical and illegal, therefore, careful research into the laws governing privacy is a priority and disclosure regulations need to be reviewed. When rewarding customers and determining what types of rewards the program should be offered an in-depth search of regulations...
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...order specifications: • Contract Purchase order • Payment terms net 30 days and different taxes • Terms and conditions regarding unavailability of power, uncalled power cuts. • Including Indemnification, right to audit, limitation of liability, changes according to market price(or fixed) 2. What are the risks and rewards to consider in this case? How can the team balance these risks and rewards? In this case we have different suppliers but the best suited is Company A. We will consider the rewards and risks of considering single sourcing. Rewards: • Having a single source A means less work to qualify the source and probably less administrative effort in dealing with them. • Since all of their volume is given to source A, the buyer has maximized his leverage based on total volume of energy. The buyer should make sure that this point is emphasized during the negotiations concerning price, etc. • The energy supplier A feels special obligation to help the manufacturer in terms of availability, etc. • Easier to track down the source of problems as well as affected products in the event of a quality investigation/recall Risks: • Risk can be defined as the magnitude of exposure to financial loss or operational disruption and stems from uncertainty. What if the single source A goes on strike or has a fire at its facility, disrupting its energy process...
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...Classic Airlines is facing the same issues that many organizations are faced with which is providing increased value to their customers with a tighter budget, as the fifth largest airline Classic airlines has had declining profits and their stock prices have fallen this has adversely affected the organization. To make matters worse Classic Airlines has lost 19 percent of their Classic reward members; and the members they have left are flying with Classic even less these days (UOP Portal, Classic Airlines, 2011). This has forced the company to restructure based on extreme competition and the declining metrics disclosed from their customer loyalty report. Chief Executive Officer Amanda Miller has tasked the leadership teams to make improvements to the frequent flier program that will promote positive returns. The board of directors recently mandated a 15 percent cost reduction across the board that will be in effect for the next 18 months. To achieve this task Classic will need to analyze feedback from customers and understand their objectives and align those with their long term goals. The issues and opportunities present in Classic airlines will be addressed as well as any ethical dilemmas or stakeholder perspectives that need to be addressed. The problem definition and the end state vision will be discussed and the optimal solution will be proposed for Classic Airlines. Issue and Opportunity Identification Classic Airlines has several issues that they need to address...
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...CHAPTER 13 RISK, RETURN, AND THE SECURITY MARKET LINE Answers to Concepts Review and Critical Thinking Questions 1. Some of the risk in holding any asset is unique to the asset in question. By investing in a variety of assets, this unique portion of the total risk can be eliminated at little cost. On the other hand, there are some risks that affect all investments. This portion of the total risk of an asset cannot be costlessly eliminated. In other words, systematic risk can be controlled, but only by a costly reduction in expected returns. 2. If the market expected the growth rate in the coming year to be 2 percent, then there would be no change in security prices if this expectation had been fully anticipated and priced. However, if the market had been expecting a growth rate other than 2 percent and the expectation was incorporated into security prices, then the government’s announcement would most likely cause security prices in general to change; prices would drop if the anticipated growth rate had been more than 2 percent, and prices would rise if the anticipated growth rate had been less than 2 percent. 3. a. systematic b. unsystematic c. both; probably mostly systematic d. unsystematic e. unsystematic f. systematic 4. a. a change in systematic risk has occurred; market prices in general will most likely decline. b. no change in unsystematic risk; company price will most likely stay constant. c. no change in systematic risk; market prices...
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...ACFI 2005 Finance. 3. A customer has approached your commercial bank seeking to invest funds for a period of six months. The customer is particularly worried about risk following the GFC and the market volatility that continues to characterise world financial markets. Explain the features of call deposits, term deposits and CDs to the customer and provide advice on risk-reward trade-offs that might be associated with each product. Answer: Commercial banks are the main type of financial institution operating in all major international financial systems. They control a significant proportion of the financial asset within the financial system. Recently, the majority of developed economies have significantly reduced the level of bank regulation and there has therefore been a considerable growth in the commercial bank sector. Following the GFC, this deregulatory phase was criticised for having contributed to the crisis. Thus, it is natural for the customer to be worried about risk following the GFC and the market volatility that continues to characterise world financial markets. Since the core function of commercial banks is to gather savings from depositors and investors and use those funds in the provision of loans to customers this customer’s approached towards our commercial bank seeking to invest funds for a period of six months can be recognised. Call deposits- call or demand deposits are funds held in a savings account that can be withdrawn on demand. Features of call...
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...you! Well people should be aware of these things you would take away what people loved to do the most, players are very aware that they take risks every time they take the field, and there are awards that come from sports. To begin, football players should be able to do what they love to do. For example in source three the author states '' I love football i could play through an ankle injury.'' This clearly states how much D J Flucker enjoys and how big his passion to play football. Even though football players could get seriously hurt it would be horrible to make people stop doing what they love to do each and every week. In source two the author states '' The NFL ( National Football League) donates millions of dollars for research on brain injuries.'' Even if football players get hurt they will have an advantage on being able to get better. If football players weren't able to be able to play and football were to be banned forever football players would never be able to do what they love to do!...
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...Private Fitness Inc. 2 Risk assessment: 2 1、Current situation 2 2、New Risk 2 ①Risk 2 ②Risk level 3 ③Risk treatment[We will give more details later.] 3 Solution 4 1、 Management Structure(personnel and cultural control) 4 2、Progress（Action control） 5 ①Between Rosemary and the non-instructor manager: 5 ②Among the manager, instructors and clients: 5 ③A whistle-blower program 6 3、Motivation and punishment (Result control) 6 Since Private Fitness Inc. is located in an upscale community and provides specific classes to customers, each instructor is valuable and we think Rosemary should forgive Kate and still employ her as an instructor. But Kate is not qualified for the manager position because what she did is a serious ethical problem. Rosemary should hire a non-instructor manager outside, considering the risk we analyzed that a person take instructor and manager position at the same time. For the solution, our group first made a risk assessment and according to this, we will give details in the later part of the article. Objectives of Private Fitness Inc. First, we should identify the overall objective of the Private Fitness Inc., which is a small entity with only 5 employees, is to operate at a profit. Second, we need identify that the problem that Rosemary need to face with is to resolve the fraud made by Kate, which both contributes to the dishonesty and motivation of herself and the available chance to make use of. Risk assessment: 1、Current...
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...A leasing agreement is an agreement whereby one party, the lease, pays lease rentals to another party, the lessor in order to gain the use of an asset over a period of time. There are two types of lease: A finance lease in which the is lease that transfers substantially all the risks and rewards incidental to ownership of an asset to the lessee. Another one is operating lease. That is lease other than a finance lease. To decide whether a lease is finance or operating, the first step is to assess whether the risks and rewards of ownership have transferred to the lessee. Risk and rewards of ownership include Risk Rewards * Lessee carries out repairs and maintenance lessee has right to use asset for most or all of its useful life * Lessee insures asset * Lessee runs the risk of losses from idle capacity * Lessee runs the risk of technological obsolescence Throughout following list of situations in which a lease would normally classified as a finance lease The lease transfer the ownership of the asset to the lessee by the end of the lease term The lease term is for the major part of the economic life of the asset even if title is not transferred Gains or losses from fluctuations in fair value are borne by the lessee Advantages of Leasing: 1. Lease permits alternative use 2. Lease arrangements faster and cheaper credit 3. Lessee's ability to raise loans 4. Leasing prevent obsolescence 5. Lease arrangement is particularly...
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