...RATIONAL EXPECTATION While rational expectations is often thought of as a school of economic thought, it is better regarded as a ubiquitous modeling technique used widely throughout economics. The theory of rational expectations was first proposed by John F. Muth of Indiana University in the early 1960s. He used the term to describe the many economic situations in which the outcome depends partly on what people expect to happen. The price of an agricultural commodity, for example, depends on how many acres farmers plant, which in turn depends on the price farmers expect to realize when they harvest and sell their crops. As another example, the value of a currency and its rate of depreciation depend partly on what people expect that rate of depreciation to be. That is because people rush to desert a currency that they expect to lose value, thereby contributing to its loss in value. Similarly, the price of a stock or bond depends partly on what prospective buyers and sellers believe it will be in the future. Expectational Error Models of the Business Cycle A long tradition in business cycle theory has held that errors in people’s forecasts are a major cause of business fluctuations. This view is embodied in the phillips curve (the observed inverse correlation between unemployment and inflation), with economists attributing the correlation to errors people make in their forecasts of the price level. Before the advent of rational expectations, economists often proposed to...
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...REG NO: 15491119 NAME: GODWIN OMAGU QUESTION: Given the 'Rational Expectations Theory' a short run tradeoff between the price level and unemployment can only exist if the economy agent can distinguish arbitrary from real shock. Discuss Rational Expectations Theory What is the 'Rational Expectations Theory' The rational expectations theory is an economic idea that the people in the economy make choices based on their rational outlook, available information and past experiences. The theory suggests that the current expectations in the economy are equivalent to what the future state of the economy will be. This contrasts the idea that government policy influences the decisions of people in the economy. BREAKING DOWN 'Rational Expectations Theory' The idea is that rational expectations of the players in an economy will partially affect what happens to the economy in the future. If a company believes that the price for its product will be higher in the future, it will stop or slow production until the price rises. Because the company weakens supply while demand stays the same, price will increase. In sum, the producer believes that the price will rise in the future, makes a rational decision to slow production and this decision partially affects what happens in the future. "Inflation-Unemployment Trade-off under Adaptive Expectation and under Rational Expectation"? When agents in economy have adaptive expectations they predict future in the basis of what happened in the past...
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...Dissertation Director: Shyam Sunder December 2012 c 2012 by Kai Du All rights reserved. Abstract Essays in Accounting Theory: Corporate Earnings Management in a Dynamic Setting and Public Disclosure in the Financial Services Industry Kai Du 2012 This dissertation consists of three essays on the interactions between economic fundamentals and accounting information in three different settings: an infinite-horizon financial reporting problem, a coordination game with trading in the secondary market, and a bank which provides risk sharing among demand depositors. In the first essay, I propose a dynamic model of corporate earnings management in which investors have different expectations schemes. I find that while earnings management may exist when investors have rational expectations or misspecified Bayesian beliefs, it disappears in the long run of an adaptive learning process. The model also offers ample predictions on the time-series properties of asset prices and return predictabilities. The second essay studies the role of public disclosure by a distressed firm whose creditors engage in a coordination game with trading. I find that conditioned on the private information environment and equilibrium selection, better public disclosure could lead to higher probability of creditor run and lower expected welfare. The third essay introduces loan loss provision to a bank that transforms illiquid assets into demand deposits, and shows that the contingency in demand-deposit ...
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...MANAGERIAL ACCOUNTING 00819 MANAGERIAL ACCOUNTING A 11:0 - 12:30 MW 142 00820 MANAGERIALACCOUNTING B 12:30 - 2:0 ST 142 00821 MANAGERIAL ACCOUNTING C 2:0 - 3:30 MW 142 00825 MANAGERIALACCOUNTING G 9:30 - 11:0 MW 142 00826 MANAGERIAL ACCOUNTING H 11:0 - 12:30 ST 142 00827 MANAGERIAL ACCOUNTING I 12:30 - 2:0 MW 142 00828 MANAGERIAL ACCOUNTING J 2:0 - 3:30 ST 142 00829 MANAGERIAL ACCOUNTING K 3:30 - 5:0 MW 142 MACRO ECONOMICS 01263 MACRO ECONOMICS A 5:0 - 6:30 MW 7072 01265 MACRO ECONOMICS C 9:30 - 11:0 MW 7072 01266 MACRO ECONOMICS D 11:0 - 12:30 ST 7072 01267 MACRO ECONOMICS E 12:30 - 2:0 MW 7072 01268 MACRO ECONOMICS F 2:0 - 3:30 ST 7072 01269 MACRO ECONOMICS G 3:30 - 5:0 MW 7072 01270 MACRO ECONOMICS H 5:0 - 6:30 ST 7072 BEHAVIORAL SCIENCE 00783 INTRODUCTION TO BEHAVIORAL SCIENCE A 3:30 - 5:0 MW 154 00784 INTRODUCTION TO BEHAVIORAL SCIENCE B 5:0 - 6:30 ST 154 00785 INTRODUCTION TO BEHAVIORAL SCIENCE D 9:30 - 11:0 ST 154 00787 INTRODUCTION TO BEHAVIORAL SCIENCE E 11:0 - 12:30 MW 154 00788 INTRODUCTION TO BEHAVIORAL SCIENCE F 12:30 - 2:0 ST 154 00789 ...
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...Case Analysis - Thomas Green: Power, Office Politics, and a Career in Crisis 1. What are the different work styles, personalities, and expectations of Davis and Green? There are a number of differences among work style, personalities, and expectations of Davis and Green. First of all, Davis preferred to use market data to support his planning and forecast, convincing others by statistics and diagrams. Perhaps, based on his experience, he has perceived that some of the clients may not be the final decision maker. Showing statistics is one of the easiest ways to make clients to convey the information to superiors. On the other hand, Green preferred to meet with clients face to face and listen carefully to clients’ needs, directly dealing with the issues. He weight clients much over daily routine tasks Besides, even if both of them have high self-esteem, Green, the young man, is more impulsive than Davis. Plus, Green is more likely to express his feeling and comment on issues simply according to his knowledge at the public place. To give inputs, it may have other ways to reach the same results and effects. Unlike Green, Davis was more sophisticated to complain on Green’s attitude by listing the rational points in the email to Division Vice President, which is more persuasive than merely using emotional words. Additionally, with seniority, Davis expected Green, his subordinate, to assist him by providing market data and supporting detail and by developing new market strategies...
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...June 18, 2012 A teacher’s expectations can greatly impact how well a student does in a classroom. If a teacher demonstrates expectations in rational and positive manner, the student is more likely to excel in the classroom. However, if a teacher has a negative outlook and does not let the students know exactly what is expected, the classroom will not run as smooth and the students’ grades might be poor. There are many expectations that would positively influence student achievement. The five that will be covered in this paper are arriving on time and prepared, positive communication with classmates and the teacher, completing a reading log each night, turning assignments in on time, and paying attention in class. When addressing a fourth grade classroom, asking students to arrive on time and be prepared would be an expectation that would influence a student’s academic achievement. There are many reasons why it is important for students to arrive to class on time. First of all, a fourth grade classroom is busy and has a full day of activities each day. Arriving late would cause a student to not only miss out on an important morning activity, but it would be disruptive to other students who are moving on to their next assignment. The same is said when asking a student to come to class prepared. The unprepared student is not only taking valuable time out of his or her day, but that of his classmates. This expectation would influence the students’ academic...
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...meaning, and therefore, he has no verse to contribute. For example, after the first day of class, Todd writes “Carpe Diem” on his paper, dreaming of what it would be like if he, too, could contribute a verse and be great like those in the picture. His insecurity gets the better of him, though, and he throws out the paper believing he has nothing to contribute. Later, in class, after being asked to write a poem, Todd tells Keating he never completed the assignment after he spent many hours writing and revising his poem only to have thrown it away before class. This is a prime example of Todd’s struggle between romanticism and realism, where Todd begins dreaming of future possibilities and ways of expressing himself only to have his realistic expectations crash down on him and diminish his thoughts of potential greatness. Keating sees through Todd’s fear and first makes him yawp, and later makes him say whatever comes to mind. This is the beginning of the change in Todd. “I close my eyes and this image floats beside me The sweaty-toothed madman with a stare that pounds my brains His hands reach out and choke me And all the time he’s mumbling Truth, like a blanket that always leaves your feet cold. You push it, stretch it, it will never be enough Kick it beat it, it will never cover any of us. From the moment we enter crying, to the moment we leave dying, it will just cover your face as you wail and cry and scream.” In this poem, Todd is saying that the madman is passion...
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...Few memories as a failure on a major project from half a decade ago still vividly remains in memories. As a Research Assistant to Tim, it was my first paid job. Tim, an Engineer, worked in silos and had driver social style to his heart beat. He only communicated the expectations without delving in the details that he had in his mind. Even though the Office space was a closed knit space for 16 students, Tim seldom hung out with people to build personal relationships. He only interacted with others when there was a need. His lack of explanation on why the project was needed had left me wondering regarding purpose and design aspects of the new programming project. I struggled on how to effectively design the project and often sought help from other people, who recommended me that the project needed investment in new programming platform as old platform was incapable of achieving the project objectives. After making almost no progress on the project and wasting time in attempts to make old platform workable, I received a vehement email from Tim, stating that XYZ Inc. was deciding to scale back on funding, as no progress reports were submitted. I was shocked to learn that I was even expected to submit progress reports at the end of quarter on the undertaken project in which I had neither any clue nor communication. As an amiable person, I was too quick to reach an agreement with Tim on project deliverables. I had thought that I would be receiving friendly advice and guidance from...
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...Foreign Literature The career factors used by Richardson (2009) are similar to the pre- and post-entry Expectations examined by Blomme et al. (2009). Blomme et al. found distinct differences in expectations of job content, development opportunities, work-family balance, salary, Performance-related pay and career opportunities. The authors argue discrepancies in what employees expect in the industry and actually experience may lead to negative consequences, such as turnover Richardson (2009) received completed surveys from 379 tourism and hospitality students (25% response) in Australia to measure perceptions of the hospitality industry. The author examined differences between importance and expectations of students on 20 career factors. The authors found discrepancies between what students perceived as important and what they expected in a hospitality career. Richardson concluded hospitality and tourism students do not expect the hospitality and tourism industries to offer them the career factors they feel are important. In addition, the author noted tourism and hospitality students do not have a clear idea of careers and working conditions in the hospitality industry. A study carried out by Chen (2000) which analysed the perceptions of tourism students’ toward work values concluded that one particular group of students categorized as “income movers” expressed a reduced desire to work in the industry due to poor earnings potential. Barron &...
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...PRACTICAL RESPONSIBILITY I: NORMATIVE EXPECTATIONS In Chapter II, I have identified a basic objection to any responsibility-based account of action, the fundamental problem. In a nutshell, the concept of action appears to be prior to the concept of responsibility in the logical order of things. If so, then an account of action in terms of responsibility is impossible. I have also suggested that the challenge thus posed could be met with a concept of practical task-responsibility. The aim of this and the next two chapters is to develop such a concept. I will claim that a person is practically task-responsible for ϕing just in case it would be reasonable (in a special sense I will explain in Chapter V) to expect of her that she ϕ. Two major conceptual tasks lie ahead. First, the concept of expectation involved must be clarified. Second, the concept of reasonableness must be explained. These are the respective tasks of the present and the next two chapters. As we will see, both tasks are rather delicate. In both cases, we will see that the fundamental problem reappears at various junctures in the natural course of explanation of the concepts. I begin the chapter by clarifying the distinction between normative and predictive (or descriptive) expectations (section 1). Sections 2-4 proceed to discuss the concept of normative expectations, since the concept of practical task-responsibility is characterized exclusively in terms of normative expectations. After some preliminary conceptual...
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...Analyze the Thomas’s situation He proved himself to be very talented and intelligent, but he failed to satisfy the expectations of company and his superiors, Davis and Mcdonald. His direct expression for his ideas and his overly confident and arrogant personality made him to be unable meet office politics. His superior, Davis pointed out that he is “truly disappointed with Thomas’s work” and he has concerns with his “attitude and job performance”. Therefore, now he is situation to be receiving a dismissal in his position. Mistakes 1 (culture, power dependency) Green violates the group’s norms and regulation. Norms is a acceptable standards of behaviour within a group that are shared by group members. It is important because: • Facilitates group’s survival • Increase predictability of member’s behaviour • Decrease embarrassing interpersonal problem for members • Allows members to express central value of group and clarity what’s distinctive about group’s identity • It increase solidarity and cohesiveness His direct expression for his ideas and his overly confident and arrogant personality make him to be unable meet office politics. Green knows his capability and intelligent talent than any other people. Therefore he feels he has a right to express his idea under any circumstances and thinks his actions and choices are always right. More importantly, after his promotion, he admits his legitimate power in the office and thinks his power is equal to the Davis, his...
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...PERFORMANCE MANAGEMENT 1 Objective Objective of this policy is to set a process for managing the performance of the employees so as to achieve the ultimate objective of the organization. By adopting this policy we aim to attain the following objectives: 1 To help employees setting their priorities (objectives) right at the beginning of the year; 2 To align the individual/employees objectives with departmental objectives and the departmental objectives with the organizational objectives; 3 To enable/facilitate evidence based decision making in: a. Determination of compensation packages, wage structure, Salaries adjustment/raises, etc.; b. Employees retention, succession planning, Training &development 4 To identify the strengths and weaknesses of employees to place right men on the right job; 5 To maintain and assess the potential present in a person for further growth and development; 6 To provide a feedback to employees regarding their performance and related status; 7 To improve the working habits of the employees. 2 Scope This policy is applicable to all regular employees of the Organization. 3 Accountabilities 4.1 The Vice Chancellor (VC)/Executive Director (ED) – Based on the five years plan shall ascertain the key result areas for the year. 4.2 Deans shall ascertain their individual faculty’s contribution to achieve the key result areas set by the VC/ED and shall be responsible for the development...
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...The character's internal conflict of outward conformity versus inward questioning is manifested in the novel “Death of a Salesman” written by Arthur Miller, in which he portrayed Willy as a hollow salesman, constantly seeking wealth and fame in his life. Believing in his corrupted version of American Dream, Willy was unable to withdraw himself from his self deluded idea of societal conformity. Throughout the novel, Willy is in a constant state of mental dissillusionment. Containing a strong desire and obligation to fulfill his American Dream, he often contradict himself and thus trying to justify actions and events through nonsense justification. However, traces of Willy natural and subconscious inclinations also constantly show up in the novel. Therefore, as a result, Willy achieved virtually nothing in his life just like his belief in American Dream, which is surreal and intangible as well. Throughout the novel, the outward conformity and inward questioning of Willy often create contradicting tension. Willy often make contradicting statements from his previous assertions in order to conform his later statements into the standard of his American Dream. For example, Willy earlier stated that Biff is lazy, but he later denied Biff's laziness. He does so in order to retain his hope in Biff, wishing that someday he will achieve his American Dream through Biff. Another example of self contradiction is also manifested when Willy said that he will attain a more successful business...
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...1--2--3--4--5--6 Interpersonal Skills 4. Drawing from past work experience, describe several situations where you had to interact with "difficult people" and how you handled the situations. 1--2--3--4--5--6 5. Comment on the following: "Students are the most important people in our business." 1--2--3--4--5--6 6. This office is many times "all things to all people." How do you see your skills and personality fitting into that expectation? 1--2--3--4--5--6 Professional Ethics/Behavior 7. Tell us how you have handled past work situations that required "confidentiality." How might that procedure impact this office? 1--2--3--4--5--6 8. Discuss your understanding of the word "teamwork" and how you have been involved with that process on the job or in other settings. How might teamwork (or lack of it) affect an office setting? 1--2--3--4--5--6 9. Due to student needs and staff schedules, your daily schedule will change occasionally to help in meeting those needs. Comment on your flexibility with time and any expectations you might have. 1--2--3--4--5--6 Closing 10. Do you have any questions of us about this position? THANK YOU! (Describe remaining process.) Total score:...
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...brainless, or have a completely fake personality? Well, I think that the answer remains questioned. Most guys go after the “hot blondes,” not really caring about their personality, and only their looks. I think that this issue causes three main problems. For one, it makes some girls feel insecure, or not “pretty” enough. Two, it gives girls a label on what they should and should not look like. And lastly, it tells girls that we need to reach a high expectation to be good enough. As we know, the world is not perfect. However, we also live in a very judgmental world. Today, girls are constantly judged on their facial features, they eye and hair color, their body, and more. When guys choose the girls with not only no brain, but a horrible personality, it shows what kind of guy that person really is. Not only is it a shallow act on the guy’s part, but it also offends the girls. When girls see that guys are not going to be interested unless you meet certain expectations, they tend to change their features to meet others expectations. Things such as dying hair and acting dumb are two things that girls do just to get guy’s attention, knowing that they will not even notice them unless they act that way. Because of all these horrendous acts, girls are influenced to change themselves to the way others would rather them look like. All throughout magazine’s, girls are shown what they should and should not look like. For instance, have you ever seen an overweight person on the cover...
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