...1. What are the determinants of assets demand? 1. Wealth, the total resources owned by the individual, including all assets 2. Expected return (the return expected over the next period) on one asset relative to alternative assets 3. Risk (the degree of uncertainty associated with the return) on one asset relative to alternative assets 4. Liquidity (the ease and speed with which an asset can be turned into cash) relative to alternative assets 2. What are the implications of efficient market hypothesis on the academic field? 1) It implies that in an efficient capital market, one investment is as good as any other because the securities’ prices are correct. 2) It implies that a security’s price reflects all available information about the intrinsic value of the security. 3) It implies that security prices can be used by managers of both financial and nonfinancial firms to assess their cost of capital (cost of financing their investments) accurately and hence that security prices can be used to help them make the correct decisions about whether a specific investment is worth making or not. 3. What are the favorable evidence that markets are efficient? 1. Investment analysts and mutual funds don't beat the market. 2. Stock prices reflect publicly available info: anticipated announcements don't affect stock price. 3. Stock prices and exchange rates close to random walk; if predictions of DP big, Rof > R* predictions of DP small...
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...“Discuss the questions raised by the financial crisis over the objective of general purpose financial reporting, and how the IFRS Foundations Trustees wish to resolve them”. The financial crisis which started during the summer 2007 is, by its magnitude and its scale, the strongest crisis that happened since 1929. Begun as a bank crisis which have destroyed and “all the major US bulge-bracket firms” (Molyneux & Valdez, 2010, page 263), the crisis spread like wildfire and has rapidly engulfed the entire financial world. Even if everybody agree to recognise that accounting was not the root cause of financial crisis, its role to prevent future financial crisis could be significant. Many questions have been raised by financial crisis over the objective of general purpose financial reporting. The first question is related to the purpose of the financial reporting. In fact, the actual crisis has showed that, more than ever, the financial sector needs prudential regulators (Goodhart, et al.,2003, page 10) (Molyneux & Valdez, 2010, page 470) (Spencer, 2000, page 211); because the information given by the financial reporting is an important tool for regulators, standard setters and regulators need then to collaborate. However, their interest could overlap or be in conflict. In these cases, it is important to formulate clearly the main aim of financial reporting. The lacks of global standard as well as the inconsistency of some standards are two other weaknesses of the financial...
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...economic systems Socialism (planned and collective), capitalism (individualistic and competetive), mixed (planned and individualistic – war capitalism, collective and planed – market socialism eg. China) 5. Name basic institutions of effective capitalism Provate property rights, market system, no corruption, monetary stability, openess of economy 6. Name basic recommendations or elements of merchantilism Encouraging agriculture, ecenomic wealth can be measured by precious metal (silver/gold); export over import, merchant fleet as vital importance, government involved in economy 7. Key elements of national competetiveness Basic institutions, infrastructure, stability 8. Name main elements of firm competetiveness Demand and supply, financal performance, investment ratio 9. When Keynesian policies to fight recession can not be applied? When there is a budget deficyt, high public debt, recession, no possibility to borrow money 10. How many arguments in favour of protection of infant industries can u name? Further development of this industry, reduction of unemployment, better situation in military Times, increase od Keynesian’s multiplier 11. Name arguments against protection High taxes for subsides, uncompetetive production, corruption, faulty specialization, trade wars, rise of prices, no scale benefits 12. What is dumping in economics? Dumping – selling below cost of production or below market...
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...Advantages. 5. Other expenses. 6. Investments. 7. Purchases from financial assets. 8. Repayments of loans. 3 Government Expenditures Economical Criterion Functional Criterion Includes eight chapters 4 State Budget “ Is a financial plan that includes the expected G Revenue and expected G Expenditure for the next fiscal year, used to achieve society's targets, economic growth, social Equity, … etc. ” G Expenditure Ch.1 Wages & salaries Ch.2 Purchases of good service Ch.3 Interests Ch.4 Subsidies & Social benefits Ch.5 Others Spending Ch.6 Investments Ch.7. Purchases of financial Assets Ch.8. Repayments of loans 5 Values G Revenue Ch.1 Taxes Ch.2 Grants Ch.3 Others Revenue Ch.4 Collected money from selling financal Assets Ch.5 Public Borrowing Proposed State Budget 1) Wages and salaries: 172 Billions L.E Increased by 20.7% from the adjusted budget [143 ---- 172 Billions L.E] Average weight is estimated by 25% of the total expenses. 2) Interests are estimated by 182 B.L.E Increased by 31% from the adjusted budget. [138.6 ---- 182 Billions L.E] Average weight is estimated approximately by 26% of the total expenses. 3) Subsidies: 205.5 B.L.E Increased approximately by 31% from the adjusted budget. [183 ---- 205.5 Billions L.E] Average weight is estimated approximately by 30% of the total expenses. 6 Total Expenses 25% for wages and salaries 26% for interests 30% for subsidies 19% for other expenses The total government expenditures...
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...Worldwide Paper Company ------------------------------------------------- An Analysis of Blue Ridge Mill Ebha Agrawal, Elizabeth Collins, Sagar Jain, Ross Manfre, Joshua Newby Financal Management 7010 October 6, 2015 Executive Summary: In 2006 Worldwide Paper Company, a leader in the paper production industry, is faced with a challenging question. Should they build their own on-site longwood woodyard or continue to purchase from another mill? Blue Ridge Mill, a subsidiary of Worldwide Paper Company, is considering this strategic move to save on operating costs and enter a new market on the recommendation from Bob Prescott, the controller of the mill. With production set to begin in 2008, Worldwide Paper Company would see an operating costs savings of $2.0 million in 2008 and $3.5 million per year in the years after. This savings comes from producing their own shortwood product versus purchasing from Shenandoah Mill. The addition of the on-site woodyard also allows Worldwide Paper Company to capitalize on the increased production capacity to enter the shortwood market to now compete with its former business partner expecting to reach sales at $10 million in 2009 and continue until 2013. Is this a good investment for Worldwide Paper Company to enter? The following analysis will consider following: net present value, NPV;...
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...ACCOUNTINGS ASSIGNMENT 02 Rochana Sandaruwan ID = KARSD21 PART A Financial Ratio | How to calculate it | 2011 | 2012 | Current Ratio | Current Assets ÷ Current Liabilities | 28000 = 7 4000 | 42000 = 2.33 18000 | Quick Ratio | Quick Assets ÷ Current Liabilities | 16000 = 4 4000 | 20000 = 1.11 18000 | Account Receivable Turnover | Net Sales ÷ Average Debtors | 40000 = 5 8000 | 60000 = 3 20000 | Inventory Turnover | Cost of Goods Sold ÷ Average Inventory | 26000 =2.36 {(10000+12000)/2)} | 42000 =2.47 {(12000+22000)/2)} | Debt Ratio | Total Liabilities ÷ Shareholders Equity | 4000 = 2.5 8000 | 4000 = 2.5 8000 | Net Profit Ratio | Net Profit x100 Sales | 6000 x100 =15% 40000 | 4000 x100 =6.67% 60000 | Return on Owner’s Capital | Net Profit after Tax – Preferance dividend x100 Equity share | 6000 x100 = 15% 40000 | 4000 x100 = 8.33% 48000 | The current asset ratio is one commonly used tool that measures the liquidity and financial position of a company. This ratio is used to determine how well a company is able to pay its short- term liabilities.A ratio of two or higher is considered good. Companies with ratios of two or higher are often more likely to have fewer issues paying their debts...
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...aging population, reasons substantiating the cause for national concern, and two major reasons medical care for the aging population needs reforming. Issues Surrounding Medical Care for the Aging Population and Reasons Substantiating the Cause for National Concern Current estimates predict by 2015, the Baby Boomer population will increase more than 76 million. One of the reasons this population of Americans is expected to live longer, is because of the continuing advances in medical technologies.The aging population will require different levels of health care at different intervals, to avoid their health continually going downhill, resulting in admission into a long-term care facility. The years 1998-1999 marked a fractured health care financal system. In addition, during this time, Medicare executed payment systems for skilled nursing services and home health care. Therefore, the current challenge in America is to figure out how to deliver the level of quality care expected by seniors and how to finance it (Derr, 2005). Two Major Reasons Why Medical Care for the Aging Needs Reforming The first major reason medical care for our aging population needs reforming are cost and resources. Some older people do not go to the doctor because he or she cannot afford the cost of health care insurance, prescription drug costs, and the cost...
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...Garmin Analysis: Looking To The Future Kimberly Moore-Hobbs Dr. Steven Tippins JWI 530 Jack Welch Management Institute Abstract In marketing, my role is to develop a plan to monopolize the GPS market and decrease threats that enter the industry to sabotage our product of GPS. In this case study, I will reveal the opportunity of NPV, ROIC, and ROE in which will build revenue for the company. My capital will compromised by inquiring capital by an outside source. I will develop a strategy, which will include acquisition, research that will grow the needs of the company. The segment of my company, which is fitness aviation and marine units, will deteriorate. In 3 years time I will disinvest the non-core operation (3 million dollars) and receive a cash bonus of 500 million dollars. My automotive segment will rapidly decline. The competitor which is the smart phone, with there 65 billion industry and is growing at a steady rate of about 20% a clip will decrease my profit shares to zero. Garmin is fighting against it competitor the smart phone and the brand name that support smart phone such as Apple, Blackberry, Google, Nokia and HTC.I will reanalyze the ramification of the capital structure of Garmin. I will forecast a projection that will develop an appropriate financial method that increases revenue. My plan will include excess cash that result in positive benefits in cash flow. Garmin Analysis: Looking To The Future Financial statements Garmin has a strong...
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...COURSE NAME: MBA-621-FINANCIAL AND MANAGERIAL ACCOUNTING NAME: ANGELINA TAYLOR STUDENT ID: R1402D57229 DATE: 25-11-2015 ASSIGNMENT TWO Part 1- Planning and Control 1) The primary purpose of a budget The primary purpose of a budget is to serve the needs of management in respect of the judgments and decisions it is required to make and to provide a basis for the management functions of planning,c ontrol, communication and motivation. J R Dyson noticed the following about the usefulness about a budget: It forces management to look forward rather looking back, it encourages management to examine what they have done in relation to what they could do and prominently budgeting helps management in control through the constant comparison of actual results with budgeted results, and then taking any necessary corrective action. Dyson J R (Accounting For Non-Accounting Students. Pg. 377). From the above the main purpose (considering the question) is all of directing, giving attention, problem solving and a few more like control and motivation. Budgets aid planning, which gives a business direction. A budget takes the organizational plan (goal and objectives) and quantifies this into something tangible to aim for. Budgets, by defining where the business is going and how it would get there help management and employees alike to focus. Some budgets even go further in reinforcing this focus by listing what will not be done in the period it will cover. Budgets tend...
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...MỤC LỤC Part 1 2 1.1 Introduction 2 1.1.1 The reasons why we choose South Africa 2 1.2 History and Demographics of the people 3 1.2.1 History 3 1.2.2 Demographic of the people 6 Part 2 8 2.1 Forces that exist in the business and cultural environment of the country 8 2.2 What we would like if we were resident of South Africa 9 2.3 What we wouldn’t like if were resident of South Africa 11 2.4 Primary exports and import, trading partner. Graph the historical rate of the exchange between your South Africa 's currency and that of the United States dollar 12 2.4.1 Primary exports 12 2.4.2 Primary imports 13 2.4.3 Primary trading partners 13 2.4.4 Exchange rates 13 Part 3 14 3.1 Resources, Initiatives of business organizations and South Africa’s government policies 14 3.1.1 Resources and Initiatives of business organizations already exist in South Africa 14 3.1.2 South Africa’s government policies aid such initiatives (Include Financial, Marketing, & Human Resource issues) 16 3.2 Advices for businessmen 17 3.2.1 Business culture 17 3.2.2 Business notices 19 References 21 SOUTH AFRICA ESSAY Part 1 1.1 Introduction 1.2.1 The reasons why we choose South Africa * South Africa is a country of BRICS In 2010, South Africa began efforts to join the BRIC grouping, and the process for its formal admission began in August of that year. South Africa officially became a member nation on 24 December 2010, after...
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...Understanding the Concepts William Gould Finance 100 Dr. Crawford March 7, 2013 Strayer University, Augusta Campus Owning and operating your own business is a goal of most Americans. The thing about owning your own business is to understand the concepts of operating a small business. When thinking about starting a small business, a person must have a well written business plan. A business plan is an “a formal document that describes a business concept, outlines core business objectives, and details strategies and timelines for achieving those objectives” (Kelly & McGowan, 2012).A business plan consist of marketing: products and services offered, demand from customs, market and location, advertising and marketing plan and pricing strategy, Financial Management: amount needed to start, expected cash flow, projected income and balance sheet, etc...Operation: daily management, hiring and personnel policies, insurance coverage and leasing agreement (Gordick, 2003). Within a small business, a small business owner must be able to keep track of the money that is coming in and going out. Using the different financial source and equation to operate your business is essential in owning and operating a small business. Understanding the concepts will help you own, operates and sustain a small business. NPV and payback is a concept a small business owner must understand, when making decision in a small business. NPV or net present value method is a dynamic investment appraisal...
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...The Rise and Fall of WorldCom Shabnam Rakeen RES500-Fundamentals of Quantitative Analysis Colorado State University – Global Campus Dr. Barry Smith The Rise and Fall of WorldCom The aftershock of the fall of WorldCom was not only felt in the United States but all over the world. Once a company that was ranked number 4 amongst the Fortune 500 companies was losing everything and was involved in turmoil of accounting fraud and financial troubles unimagined to anyone (Pandey & Verma, 2004). The fraudulent activities and financial troubles led to WorldCom filing bankruptcy protection under Chapter 11 and brought the end to a world known telecommunications company. What led to these financial troubles? How could the fraud go on for so long without notice? These were some of questions that the stakeholders of the company were gripped with. The purpose of this paper is to analyze the financial statements of WorldCom and determine whether these statements foreshadowed the troubles ahead. WorldCom was a successful telecommunications company with its history dating back to 1983. It started out as small long distance calling service provider called Long Distance Discount Service (LDDS) in 1983. Bernard Ebbers was one of the early investors in the company and 1985 became the chief executive officer of the company (Pandey & Verma, 2004). Under his direction, the company acquired Advantage Companies in 1989 and became a publically traded company. The company expanded through mergers...
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...Compare the models of government-business relations in two countries , focusing on one industry . Which model is best? Why? Compare the models of government business relations in Sweden and the United States This essay will compare the two models of government business relations operating in the banking sectors of Sweden and the United States (US). The main argument presented, is that the Swedish model provides a more effective outcome for both the citizens and businesses by offering greater economic stability within the internal economy and also the banking sector. This argument is supported by examples that demonstrate how the Swedish model enabled quick and effective implementation and has provided the Swedish banking sector stability since its inception in1992. Sweden has a socialist democratic system with a capitalist economy, a socialist embedded welfare system and a deregulated financial market which has benefited from constant economic growth (Central Intelligence Agency, 2010). Sweden’s growth continued till the 1990’s when it experienced the ‘1990 Bank Crisis’ similar to the American subprime mortgage crisis (Phillips, 2009). The United States has a liberal democracy with a market orientated economy which is one of the most powerful economies in the world with a GDP of $14.29 trillion (Central Intelligence Agency, 2010). However unlike Sweden the United states economy does suffer from insufficient economic infrastructure and medical and welfare systems (Central...
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...Unit No.12 (Financial Management) Unit Code: AA/012/P013 Assignment Title: Expected Knowledge and Skills-- Finance Manager Assignment No. 12- AA/012/P013-IND Contents Acknowledgement 2 Task 1 3 What are the financial management and why it is necessary for an organization? 3 What are the financial objectives of the firm and how they are related to corporate strategy? 4 Corporate strategy is about the choices complete controls create regarding problems like the particular organization the company is in, whether new marketplaces would be joined or whether to take out from current marketplaces. These kinds of choices can commonly have substantial financial effects. If, for example, a decision is taken to enter a new manufacturing company, and current organization in that industry could be bought, or a new organization be started from the beginning (Van Horne, & Wachowicz, 2008). 5 How financial objective can be different in case of non for profit organization. 5 The financial objectives of the not-for-profit organization must agree with the objective of the organization and financial constraints. For example, if the not-for-profit organization is particularly pleased to be an organization, an organization increase national could cause you to lose its appeal. Compose a record of objectives that fit the objective of the not-for-profit organization and are possible objectives (Saunders, et. al. 2006). 6 Define the types of stakeholder a company have and...
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...Outline 1) Introduction 1. History of Karstadt 2. History of Quelle 2) Crisis 2.1 What is a business crisis in general? 2.2 KarstadtQuelle crisis 2.3 Wrong Management 2.4 The stores 3) The Turning 1. New manager 2. The merger 3. New marketing 4. Out of the crisis 4) conclusion The KarstadtQuelle Crisis Introduction It is well known that KartsadtQuelle AG has been through big crisis which caused a lot of changes. This objective is to show the crises Karstadt Quelle went through. It questions how this could happened and why. Further it will show the changes KartsadtQuelle started to prevent going bankrupt and the position in the market in the past and present. History of Karstadt The eponym of Karstadt, Rudolph Karstadt (1856-1944) opended a "Clothing manufacture and retail shop C. Karstadt" in 14th May 1881 in the north of Germany with the help of his father. 1885 the fabric merchant Theodor Althoff (1858-1931) takes over “the haberdashery, linen and woollen goods shop” from his mother. While Rudolph Karstadt expanded in the north of Germany, Theodore Althoff extended in the western of Germany. By 1910 Theodor Althoff operated 11 stores and established in 1912 his largest store in Essen with 10.000 square meters of selling space and with 53 different departments. These two persons had a similar concept –...
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