Terror Management Theory - 1289 Words

Introduction Psych 317 As humans, we are unique from animals in many ways. We have an internal guidance system called a conscience that allows us to think and act in a way close to our deepest values. We have an independent will that does not allow genetic influences or the environment to dictate our actions. We have an infinite creative imagination that allows us to create beyond our reality but perhaps the most uniquely human endowment we all possess is self-awareness. Self-awareness is the recognition of how we feel and how we behave. It also allows us to examine why we exist and ultimately, that we are going to die. While self-preservation is a characteristic to both humans and animals, the understanding of one’s own†¦show more content†¦While this study suggests that there is no need to be around similar people during times of vulnerability, the researchers recognize that the individuals in these groups were mere observers and not actually interacting with each other. Another hypothesis that emerged from TMT research is the anxiety-buffer hypothesis. This hypothesis stresses the importance of high self-esteem and how it can shield individuals from experiencing death anxiety. Individuals with high self-esteem feel that they are an ideal example of their culture and enjoy the protection from the mortality concerns that their culture offers (Hirschberger et al., 2002). Studies that exemplify the anxiety-buffer hypothesis are those that link TMT and risky sexual behaviors. In a 2004 study, researchers noted that by making mortality salient, a willingness to engage in life-threatening behaviors, such as unsafe sex, was reported (Orit Taubman, Ben-Ari). This study suggests that engaging in risky sex represents two facets of vulnerability related to the threat of death. One is the absolute fear or extermination which is associated to having the risky sex and the other is the need to love and have intimacy, a uniquely human trait that is related to self-esteem. Basically, when faced with mortality, humans yearn to fulfill their basic needs of love, even if that means risking life itself (Orit Taubman,Show MoreRelated Terror Management Theory Essay example905 Words   |  4 PagesTerror management theory (TMT) asserts that human beings have natural tendency for self-preservation if there is threat to one’s well–being (Greenberg, Sol omon, Pyszczynski, 1997). It notes that we are the cultural animals that pose self-awareness on the concept of past and future, as well as the understanding that one day we will die. We concern about our life and death but aware that it is unexpected by everything. The worse matter is that we become aware of our vulnerability and helplessnessRead MoreTerror Management Theory1289 Words   |  6 Pagesself-preservation is a characteristic to both humans and animals, the understanding of one’s own mortality is uniquely human. How do we, as humans, deal with the terror that is associated with this knowledge? According to Terror Management Theory (TMT), developed by Jeff Greenberg, Sheldon Solomon, and Tom Pyszczynski (1989), the need for â€Å"terror management† is a fundamental function possessed by humans and cultural systems. Based on the writings of anthropologist Ernest Becker and inspired by Freud’s workRead MoreTerror Management Theory Applied To Ageism In Film1554 Words   |  7 PagesTerror Management Theory applied to Ageism in Film Frida Ramirez Lone Star College – University Park Terror Management Theory applied to Ageism in Film Ageism (prejudice toward the elderly) is becoming a pressing issue as the population of adults over sixty proliferates (Levy Macdonald, 2016, p. 5). Enforcers of ageist stereotypes include the mainstream film industry. By enforcing a negative stereotype, the media subconsciously implements fear of growing old and ultimately dying among its viewersRead MoreThe Simpsons Worst Running Tv Series Of All Time991 Words   |  4 Pagesdome, a massive bomb is placed in an effort to prevent Springfield from further pollution. (The Simpsons Movie). The looming threat that in a short matter of time everyone could be dead. It is at this point that Terror Management Theory takes effect. Terror Management Theory (TMT) is a theory that effects every single human. This also applies to most TV shows, movies, books, poems, and music. TMT as defined according to Nathan Heflick, a Ph. D. and Senior Lecturer of psychology at the University ofRead MoreTerror Management Analysis Of Psychological Functions Of Religion Essay889 Words   |  4 PagesResearch Review #1 For my research review, I selected Puppy-Monkey-Baby (PMB) Terror Management Analysis of Psychological Functions of Religion. This research article focuses on terror management theory, and more specifically how religion serves to manage the terror a human may experience when confronted with the thought of death (Vail, 2010). Although non-religious beliefs can serve as a form of terror management, spiritual beliefs are frequently used to alleviate anxiety caused by death becauseRead MoreShould Disgust Influence Our Considered Moral Judgments?1328 Words   |  6 Pagesguide our judgments of a range of activities and social practices. Many advocates claim that feelings of disgust are sufficient to justify an ethical assessment. Moral disgust advocate who follow deep wisdom theory see the emotion of disgust as a suprarational source of information. This theory interprets disgust as an emotion that is morally attuned and provides insight into the nature of disgust. Advocates argue that in this day in age everything is tolerable and because of this disgust may be theRead MoreThe Science Behind Sleep : The Physics Of Sleep Essay1675 Words   |  7 Pagessleep(Walcutt). It is very difficult to wake a person during this time. To get any good sleep, it is important to be in these two stages for a while. During these stages is usually â€Å"when some children experience bedwetting, sleepwalking, or night terrors†(Stages of Sleep). A person has no muscle activity or eye activity during this time. There are many myths about better ways of deep sleeping, but one myth in particular has just recently been proven wrong. That myth is that alcohol will aid in aRead MoreThe Importance Of Artificial Disasters1206 Words   |  5 Pagesregarding dealing effectively with the disasters that occur abruptly. When a disaster occurs, the priority is to reduce the vulnerability of people to hazards such as terror attacks and natural disasters. Therefore, to save human lives and also reduce property damage, in the long run, disaster analysis is a very important part in disaster management. In a given society, disasters can expose citizens to the benefits gained from cooperation in a rather dramatic way. Specifically, individuals can break awayRead MoreTerrorism Is Very Real For Mnes Essay1233 Words   |  5 Pagesboth theory and practice. The research question addressed by this exploratory study is how international businesses apply past terrorism exposure and experience from operating in risky locations to create organizational preparedness and performance resilience to absorb and endure future terrorist attacks. This paper contributes to the international business literature by addressing a gap in the literature how firms can prepare for and respond to terrorism. The study contributes to a theory of organizationalRead MoreTerrorism Is The Act Of Using Violence1493 Words   |  6 Pagesinterpret and analyse this phenomena in many different perspectives and theories. This essay will look at two particular sociological perspectives of terrorism; by Mathew Deflem a nd Gabe Mythen and Sandra, to critically analyse the content of their articles, their perspective on the understanding of terrorism, and the limitation in respect to their theories. Mathew Deflem uses his theory to explore how Bureaucratization theory can be utilized to create effective policing, subsequently producing successful

The Effects Of The European Settlement On The Indigenous...

Human rights are the rights of humans, regardless of nationality, gender, race, or religion. We should all have this in common as we are all part of humanity. However, Indigenous people did not always have these rights (Ag.gov.au, 2015). Aside from basic human rights, Indigenous people also have their own rights specific to their culture. Before 1967, Indigenous people had different rights in different states and the Australian federal government did not have any jurisdiction over Aboriginal affairs until Australia’s constitution was amended for this purpose in 1967 (Moadoph.gov.au, 2015). Between 1900 and the present time, there have been significant changes to the rights of Indigenous Australians. The effects of the European Settlement on the Indigenous people of Australia have been devastating. When white people began arriving in Australia, the Aboriginal people believed them to be ghosts of ancestor spirits. However, once they realised the settlers were invading their land , the Aborigines became, understandably, hostile (Slater Parish, 1999, pp.8-11). In 1788, the total Indigenous population was believed to be between 750,000 and one million. By 1888, the Indigenous population was reduced to around 80,000 Australia wide (Korff, 2014). The three main reasons for this dramatic decline were the introduction of new diseases, violent conflicts with the colonisers, and settlers acquiring Indigenous land (Digital, 2015). In 1848, the Board of National Education stated that itShow MoreRelatedEuropean Settlement in Australia Provide the Catalyst for the Near Destruction of Indigenous Society1457 Words   |  6 PagesEssay Topic: European settlement in Australia provided the catalyst for the near destruction of Indigenous society European settlement had a negative impact on the Indigenous Australians and it provided a catalyst for the destruction of Indigenous society. The impact of European settlement on the Indigenous people of Australia was disastrous due to many things such as taking land that belonged to the Aboriginal people. Though there were some attempts to understand each culture, it led to variousRead MoreAustralian development in accordance to Indigenous Rights958 Words   |  4 Pagesmost practical ways, Australia is an egalitarian society. This does not mean that everyone is the same or that everybody has equal wealth or property, just that we accept all. As a country, Australia aims for the equality of all citizens; Indigenous, European and other, however these were not always the intentions of White Settlement, on the land we call home. European settlement had a severe and devastating impact on Indigenous people. Indigenous people called Australia home many hundreds ofRead MoreThe Impact Of British Colonialism On Indigenous Australians1560 Words   |  7 PagesSCS130 because they would gain insight into the impact of British colonialism on Indigenous Australians and how the laws of control and protection forced them to become dependent, this, enables an understanding in terms of the present situation of disadvantage. Hollinsworth (2008) maintains that the historical impact of colonisation by Europeans on Indigenous Australians, is the basis for contemporary racism in Australia (pp. 35,67,77,79-80,83-84,97). This is supported by, The Royal Commission intoRead MoreMovie Analysis : Rabbit Proof Fence1502 Words   |  7 Pageswhen his daughter was forcibly removed to a Native Settlement Camp for domestic servant training. Subsequently, Moodoo took up employment with the camp in an attempt to keep in contact with her . The work he does is challenging, both physically and emotionally, as he is forced into recapturing runaway Indigenous children. As a result of the hardships faced by Moodoo, he has become withdrawn, which is particularly concerning given his Indigenous culture is one based on social interactions. He alsoRead MoreBenefits Of Indigenous Australians And Healthcare Workers1066 Words   |  5 Pages Introduction: This report is designed to outline and explain the benefits to both indigenous Australians and healthcare workers (specifically Radiographers) of providing culturally competent care. In radiography, like all healthcare settings culturally competent care is essential for patient comfort and experience. To provide culturally competent care one must first understand the history of the Indigenous Australians health and factors that have had an influence on it. Health care workers mustRead MoreIndigenous Australians and Torres Strait Islanders Essay1655 Words   |  7 Pagesï » ¿EDC 2200 Indigenous studies Assignment 1 1500 words Introduction 100 – 150 words Background eg a sentence to give the reader what the essay is about. Roadmap of whats in the body of essay. Demonstrate an argument. Example intro: Colonisation has impacted profoundly on indigenous communities worldwide and this essays examines and details some of those impacts. Initially, the concept of colonisation will be explained, including the forces that were driving the colonisation and the usualRead MoreNative Imperialism And Its Implications On Aboriginal Identity895 Words   |  4 Pagesprior to the arrival of the first European settlers, Australia was once believed to be a terra nullius, an uninhabited â€Å"nothing land.† The European colonizers of Australia sought to make something of this land they believed they had discovered. Operating under this false notion, colonizers systematically invaded and conquered Australia, imposing their own ways onto the land and its original custodians, the Aboriginal people. The introduction of western settlements disrupted much of Aboriginal lifeRead MoreI Have Taken Endeavors At Balfour Downs Station At The North Western Australia Settlement Of Jigalong1687 Words   |  7 PagesI have taken endeavors in this venture. In any case, it would not have been conceivable without the kind bolster and help o f numerous people and associations. I might want to extend my true because of every one of them. I am exceptionally obligated to Amity University for their direction and consistent supervision and also for giving important data in regards to the undertaking additionally for their backing in finishing the task . I might want to express my appreciation towards my chiefRead MoreEffect of Colonisation1693 Words   |  7 Pagesin wairuatanga (spiritual connection to the natural environment), kaitiakitanga, which is that people are linked to all living and non – living things and it is the responsibility of the mankind to safeguard the ecosystem. In addition, they believed in oneness (kotahitanga) and manaakitanga - the ability to care for others (Hikuroa, 2010). According to Durie (as cited in Dew Davis, 2006) Maori people were able to manage health by sound public health principles. They were able to preserve and storeRead MoreThe Dapl Operator Announced On Election Day That It Had1248 Words   |  5 Pages The US army corps of engineers has completed its review of the Dakota Access pipeline and is calling for â€Å"additional discussion and analysis† (energytransfer.com), further delaying completion of a project that has faced massive opposition from indigenous activists. It is unclear how long the delay will last and whether it will survive under the Trump administration. Trump’s financial disclosure forms show he has between $500,000 and $1m invested in Energy Transfer Partners, and $500,000 to $1m

Central Bank Policy Decisions Affect Banks in Profitability

Question: Critically Evaluate How the Central Bank Policy Decisions Affect Banks in Profitability. Answer: Introduction of Central Banks Central banks are those banks which control the total banking system of any country. Only central banks have the authority of issuing banknotes. The major function of a central bank is to control money supply in the country by handling the interest rates. Central banks act as The lender of the last resort to the banks in this sector when there is financial crisis in the economy and banks are unable to cope with the situation. The central banks are the bankers to the government. Central banks supervise the commercial banks as they have to follow the guidelines mentioned by the bank. The central banks focus on the monetary stability, which brings constancy in the flow of money in the nations economy. Changes in the attitude for the government roles lead the central banks to develop economy as a major basis (Archer, 2009). With this concern, the paper intends to evaluate the way in which central bank policy decisions affect profitability of banks. Evaluation of How Central Banks Policy Decisions Affect the Profitability of Other Banks One of the major policies of central bank affecting the profitability of other banks is monetary policy. To evaluate the effect of monetary policy, one should have a complete understanding about the banks profitability along with the interest rates (Lambert Ueda, 2014). The central bank directly purchases securities from the open market influencing long-term rates and guiding market players about short-term rates. The open market operations are mostly used by the Federal Reserve System of central bank in America (Board of Governors of The Federal Reserve System, 2017). In the process, buying and selling of securities such as mortgage-backed securities as well as treasury notes take place from the other commercial banks, which are used as the key tool to increase or decrease interest rates. For instance, if Fed buys a bond from any other bank, the amount of securities will reduce but the amount of reserves will increase. When Fed sells the securities, economic growth and inflation ge t slower as the interest rate rises while purchasing securities, revival in the economic growth occurs as well as unemployment rates lower down along with a fall in interest rates. Considering the profitability of commercial banks, purchasing of securities by Fed will provide maximum profitability to the commercial banks as its reserves will increase. Investment and loans will be increased with the rise in the price of government securities and their interest rates will fall. Additionally, the overall interest rates will decrease and will provide motivation for new investments in the business (Saylor Academy, 2016). The yield rate and the interest level rates affect the profitability of the banks. In retail deposits endowment effect, the bank deposits are normally priced at a markdown value on market rates along with depicting a market dominated by a small number of sellers. As soon as the interest rate falls, the markdown value in the market falls. This will lead to increase in the net interest income by restricting the monetary policy. Thus, the net interest income of banks is affected due to the monetary policy where the slope of the yield curve remains conclave and leads to banks profitability. If the market rate rises, there will be a negative effect on quantity affecting the amount of bank deposits as well as loans. For instance, people prefer bank loans when the lending rates are lower along with increasing the net interest income temporarily. Correspondingly, if the lending rates rise in the future, it will hinder the profitability of the banks. The monetary policy also affects the non-i nterest incomes of the commercial banks. Keeping all other factors constant, if the bank interest rates get higher, the securities portfolios of banks will incur losses. When the securities will be available for sale in the present financial situation, the losses will be presented in the income statement and it will be applicable for equity. The impact of these losses can be observed during the realization of securities held at maturity. This effect is a temporary and will disappear as the effect of change of interest rates gets over. Hence, the process is affecting other banks profitability during its course (Borio, Gambacorta Hofmann, 2015). According to Bank of Israel (2014), hedging of interest rate risk is very essential for banks. Hedging is normally done by swapping interest rates to reduce the substantial losses or gains of the banks leading to non-interest income. Other than this, fees and commissions earned are also a part of non- interest incomes which come from deposit and lending activities as well as investment-banking-type activities. The activities may include trading, credit lines, mergers and acquisitions, and transaction services among others. Thus, non-interest incomes lead to losses for the banks affect their profitability. Lastly, loan loss provisions cover the loss from loans due to customer defaults or bad loans. During a financial crisis, low interest rates are witnessed. The condition of loans loss provisions are sensitively very high at interest rates which are low. The banks cannot bear any further losses. As the interest rate is extremely low, people will be encouraged to take more loans from the banks encouraging loan growth. This will lower down the ratio of loan loss provisions to the amount of loans increasing more amounts of unrecoverable loans from customers leading to loss of banks and affecting their profitability at large (Borio, Gambacorta Hofmann, 2015). Apart from the above, the rate at which central banks apply or signal the position of monetary policy, is known as Central Bank Policy Rate (CBPR). This rate varies and is considered as discount rates as well as repurchase agreement rate in different countries (IMF Data, n.d.). The CBPR varies for each policy interest rate based on alterations in discount rates and repurchase agreement. For instance, the different policy rates of the central banks around the world in the last 4 quarters are shown below: Figure 1: Central Bank Policy Rate Source: (IMF Data, 2017) Conclusion Based on the above discussion, it can be observed that central banks policies are linked to banks profitability. These policies directly or indirectly influence banks profitability by different analysis of financial system. According to The Central Bank of The Bahamas (2017), monetary policy is different from fiscal policy. Fiscal policy is the step taken by government not by central banks to influence a nations economy while, monetary policy is set by central banks. Fiscal policy is related to tax revenue and expenditure for the government and focuses essentially on economic growth, unlike economic stability by monetary policy. Fiscal policy is changed on a yearly basis while monetary policy is changed depending on the nations status in the economy (Borio, Gambacorta Hofmann, 2015). The increases in the rate of central banks lead to the rise in the commercial banks lending rates which discourage to borrow accordingly. This leads to decline in the profitability of the banks as custo mers will be looking for other sources of financing such as non-banking financial institutions (Mungai, 2013). Thus, for better profitability of the commercial banks, central banks must work upon to design appropriate bank-specific monetary policy that will cover the macroeconomic conditions and will help in funding currencies (Borio, Gambacorta Hofmann, 2015). The monetary policy is hence made to stabilize the output and control inflation which brings changes in the policy interest rates of the central banks in different nations. Hence, the changes of policy interest rates in central banks, will in turn develop into affecting the probability of all other commercial banks in the world (Mathai, 2012). Therefore, the contribution of central banks is immense for the growth of any bank globally. References Archer, D 2009. Roles and objectives of modern central banks. Issues in the Governance of Central Banks, pp.17-55. Bank of Israel, 2014, Management of Interest Rate Risk, Proper Conduct of Banking Business Directive [1] (5/13) Management of Interest Rate Risk, pp.333-1-333-41. Borio, C, Gambacorta, L Hofmann, B 2015, Bank for International Settlements, The Influence Of Monetary Policy On Bank Profitability, no. 514, pp.5-37. Lambert, F Ueda, K 2014, The effects of unconventional monetary policies on bank soundness, International Monetary Fund, Washington, D.C. Mungai, M A, 2013, The role of central bank rate on commercial banks profitability in Kenya, School of Business, University of Nairobi, pp.1-65. Saylor Academy, 2016, Chapter 14. The Money Supply Process The Central Bank, viewed 15 May 2017, https://www.saylor.org/site/wp-content/uploads/2011/07/ECON302-4.2.pdf . The Central Bank of The Bahamas, 2017, what is monetary policy and how is it different from fiscal policy? The Central Bank, viewed 21 April 2017, https://www.centralbankbahamas.com/faqs.php?cat=18id=10145. IMF Data, No Date, What is the Central Bank policy rate? International monetary fund, viewed 22 May 2017, https://datahelp.imf.org/knowledgebase/articles/484375-what-is-the-central-bank-policy-rate. IMF Data, 2017, Interest rates and share prices, Access to macroeconomic financial data, viewed 22 May 2017, https://data.imf.org/?sk=5477ad05-460d-4c91-9690-11e99b1ed935sId=1390030109571. Board of Governors of The Federal Reserve System, 2017, Open market operations, Credit and Liquidity Programs and the Balance Sheet, viewed 22 May 2017, https://www.federalreserve.gov/monetarypolicy/bst_openmarketops.htm. Mathai, K 2012, Monetary Policy: Stabilizing Prices and Output, International monetary fund, viewed 22 May 2017, https://www.imf.org/external/pubs/ft/fandd/basics/monpol.htm.

A Familiar Place free essay sample

I feel most comfortable in a place where a sense of calm envelops me†a place that brings peace in its own unique ways. To escape all my troubles I always go on a walk by myself. Walking to class reminds me of all the times I walked around my neighborhood in my hometown. Outside my dorm I noticed the many sorority posters on all of the girls doors around me. In the elevator I caught a glimpse ofa bright green notice about the Tiger Transit service for Clemson students. This was most evident and noticeable because of the bright colors and images attached to the otice. Outside my dorm, hills surround me; I do not know where they begin or where they end. As Im finding my way to class I pasted a group of students outside my dorm, waving signs that provide information for the Papa Johns Pizza delivering service. We will write a custom essay sample on A Familiar Place or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page I have several memories of spending time with my friends after football games eating pizza. I will never forget the fluffy, spicy, and delicious sensation I get when eating the first bite of a fresh slice of pizza. Of course I was tremendously persuaded with the pizza signs because of all the memories behind it. When I opened the door to the hall of my biology class, I noticed all the students waiting outside my classroom. Our teacher obviously was running late. As I sat there and waited, I found myself looking around and that was when I noticed a flyer about all the activities to get involved with at Clemson. During this time of the year these signs are important because it is when students try out and practice for the rest of the year. These signs could be posted more frequent and with larger print to become more noticeable and show the importance of the activities. Because of the small print I realized these signs were more subtle and soft to a normal Clemson student walking to class everyday in a hurry. Once I am seated in class with all the students around me talking and catching up the overall atmosphere creates an unmatchable experience. The drama and stress come to the front and take over my body mostly before tests. The hills outside are soon forgotten and the path of not knowing where it begins or ends, ends here until the hour is up. Expectations, anxiety, and concern are the only words with a meaning.

What if Germany had won World War 2 an Example by

What if Germany had won World War 2 Introduction Need essay sample on "What if Germany had won World War 2" topic? We will write a custom essay sample specifically for you Proceed World war II was a widespread war that occurred amongst most of the countries in the world. It was a great war which forced most countries to place their complete scientific, industrial and economic efforts toward war, combining both military and civilian resources. It was the most deadly conflict in the history of humans, with fatalities reported to have exceeded 70 million people. The military personnel involved in this war exceeded 100 million, which further shows the enormity of the war. The war started after Germany invaded Poland and subsequently, British Dominions, France, and the United Kingdom declared war on Germany. After the war, the United States and the Soviet Union emerged as the superpowers, which subsequently led to the cold war. This war led to the emergence of the United Nations, which was tasked with the responsibility of preventing such a war in future. According to Jacobsen and Smith, (96-97), Germany, Italy, and Japan subsequently formed a tripartite pact, which was meant to counter any move by the US to become involved in the war. The pact maintained that the three nations would cooperate and stand by each other over a decade, in order to establish a new order which would safeguard the welfare and prosperity of the citizens of these countries. According to Gudmens and the US Army Command and General Staff College Combat Studies Institute (63-64), the Japanese attacks on the American fleets in Pearl Harbor in 1941, led to the use of the atomic bombs on Japan, in the cities of Hiroshima and Nagasaki. The damage caused by the two bombs that were dropped in the two cities was unprecedented, and this led to the surrender of Japan in 1945. This effectively ended the war. Alliance with Japan as Germany's downfall. The alliance of Germany with Japan can be said to be a major contributor to Germany's downfall. According to Dunn (120-121), the initial pact between Germany, Japan, and Italy was meant to safeguard the interests of the citizens of the three countries, but Japan's downfall led to the collapse of the axis. As has been explained above, Japan attacked Pearl Harbor causing significant damage to US ships as well as casualties to US troops. This act, combined with Japan's refusal to surrender unconditionally, in line with the agreement in Potsdam, led to the use of atomic bombs by the US on Japan. The bombs killed an estimated 80,000 people in Nagasaki and another 140,000 in Hiroshima. According to Oakes and Kia (30-31), thousands subsequently died after being exposed to the radia tion, and this led to the surrender of Japan. Japan considered the atomic bombs to be a threat to humanity, and could not bear losses of such magnitude, especially considering that the US was planning to use other such bombs on it. These bombs exposed the superiority of the US, especially considering that Germany did not have such bombs. The surrender of Japan crippled the axis and effectively led to the end of the war, which was a blow to Germany. Germany's concern for cleansing as a contributor to their defeat in the war. During the World War II, Adolf Hitler orchestrated the murder of 6 million Jews, in an effort to 'cleanse' the world. The number of Jews who were killed was a third of the total Jewish global population at the time. The Nazis, under control from Hitler, blamed the Jews for corrupting the German culture through 'mongrel' and 'foreign' influence. The Nazis also portrayed Germans as honest, courageous and hardworking, and the Jews as cowardly and evil. The Germans built many concentration camps where the Jews were incarcerated and spent vast resources persecuting the Jews. In 1941, Germany invaded the Soviet Union and assassinated over 30,000 Jews during the first two days, through several assassination squads. It is clear that Germany spent vast resources equipping its assassination squads and other elite teams which murdered Jews. Other resources were also used for building and maintaining concentration camps. In a period of war, all resources should be used to fight the enemies, as opposed to diverting them for any other uses. Germany diverted some of its resources to 'cleanse' itself from Jews and this played a part in their defeat in the war.Germany's invention of the atomic bomb as a factor that would have made them win the war. The effects of the atomic bombs that were used by the US, were the main contributors to the end of the World War II. This, as has been explained above, is due to the number of fatalities, damage to property and future effects that they caused to humanity. In fact, Japan surrendered after the realization that the entire human race could be wiped out by solely using these bombs. The effects of the bombs caused by the radiation affected future generations. The US was preparing to use other bombs on Japan, and the loss was too great to bear, hence the surrender. If Germany had developed the atomic bomb first, then this would have been an almost certainty of winning the war. Germany needed to enrich the uranium to eighty percent level or above, and it would have developed an atomic bomb. If they had it first, they would definitely have used it against its enemies, under the rule of Hitler. In fact, Hitler would have dropped the bombs in the most densely populated cities, which would have led to the highest number of civilian casualties, without flinching a muscle. This would have made even the most determined nations to surrender, including the US and Soviet Union. Germany's success in invading USSR if its soldiers were better equipped Germany invaded the Soviet Union in 1941 through an operation which was referred to as Operation Barbarossa. The invasion was supported by the axis and involved over 4.5 million Axis powers' troops. The main purpose of this invasion was to conquer Soviet Union's link which connected Astrakhan and Arkhangelsk. However, Hitler did not achieve the success he had anticipated, and Germans were repulsed from Moscow. They were not able to mount a successful offensive afterward. The major factors that led to the lack of success were harsh climate and terrain, as well as lack of adequate equipment. The Germans launched their attacks during the summer, under the assumption that the war would be over by the time the harsh winters arrived. However, the war dragged on for longer, and the German soldiers did not have adequate clothing to keep their bodies warm. They also had a series of mishaps which limited the troops' access to weaponry. For instance, the V2 rocket failed in its last stage of development thereby decreasing the effectiveness of the Germans' attacks. The harsh winter also froze some weapons, including vehicles. Better equipment and clothing would have made the chances of Hitler's success much higher than they were. Period of time war would have dragged on if D-day was unsuccessful The D-day offensive began in 1944 and posed to end the German offensive. According to Gerrard (84-85), troops from the allied countries invaded France and fought the Germans, in a bid to liberate France. Before the D-day, the allies destroyed the bridges and railways in France and Belgium in a bid to limit the ability of Germans to access reserves. They also deceived the Germans that they would attack the country through Pas de Calais. On D-day, more than 4000 craft and 5000 ships were used in landing on the beaches. According to Zaloga and Johnson (64-65), the Germans initially put up resistance, but they were defeated by the heavily armed Allies. The Allies gained the necessary momentum after succeeding in Normandy, while the Germans were demotivated by the losses. The success in Normandy played a crucial role in the Allies' success in the war in general. If Germany had won this battle, it would have been motivated to fight harder and conquer more territories in Europe. Hitler would have captured many prisoners, aircraft, ships, tanks, arms and other equipment that would have strengthened the German troops. However, in my view, the war would not have dragged on for very long, since Germany had other weaknesses in its strategy. Some of the weaknesses have been discussed in the paper, and others include errors in strategy. Germany was trying to capture too many territories simultaneously, and this was, in fact, crippling its troops, supply, and weaponry. Another factor is that the US would still have developed the atomic bomb, which would have forced Germany to surrender irrespective of the win at Normandy. In my view, the war would not have gone on for more than five years, irrespective of whichever side won the Normandy battle. Conclusion It can be concluded that in addition to lack of equipment, poor clothing and the impact of the US atomic bomb, Germany still faced other challenges that would have made it difficult to win World War II. The conquering of too many territories simultaneously, as has been discussed, weakened the Germans. Focus on other non-war issues such as 'cleansing' the Germans also shifted resources to other less important goals. However, the alliance with Japan can be said to be one of the greatest mistakes Hitler made, and which cost Germany victory during World War II. Works Cited Dunn, Dennis. Caught Between Roosevelt & Stalin: America's Ambassadors to Moscow. Kentucky: University Press of Kentucky, 1998, p 120-121. Gerrard, Howard. D-Day 1944. New York: Osprey Publishing, 2002, p 84-85. Gudmens, Jeffrey & US Army Command and General Staff College Combat Studies Institute. Staff Ride Team. Staff Ride Handbook for the Attack on Pearl Harbor, 7 _ December 1941: A Study of Defending America. New York: DIANE Publishing, 2005, p 63. Jacobsen, Hans-Adolf & Smith, Arthur. World War II, Policy, and Strategy: Selected _ Documents with Commentary. Washington: Clio Books, 1979, p 96-97. Oakes, Elizabeth & Kia, Mehrdad. Social Science Resources in the Electronic Age. New York: Greenwood Press, 2004, p30-31. Zaloga, Steven & Johnson, Hugh. D-Day Fortifications in Normandy. New York: Osprey Publishing, 2005, p 64-65.

Insanity in Metamorphosis by Franz Kafka Essays

Insanity in Metamorphosis by Franz Kafka Essays Insanity in Metamorphosis by Franz Kafka Paper Insanity in Metamorphosis by Franz Kafka Paper Essay Topic: The Metamorphosis Famous actor, father, and husband, Eric McCormack once proclaimed, â€Å"Most people, if you live in a big city, you see some form of schizophrenia every day, and its always in the form of someone homeless. Look at that guy hes crazy. He looks dangerous. Well, hes on the streets because of mental illness. He probably had a job and a home.† Basically, what McCormack is saying is that schizophrenia is found all around us, is found in people from all different walks of life and no matter the circumstance, everyone shares the same form of saneness and equality in some how, in some way. In The Metamorphosis by Franz Kafka, the main character Gregor Samsa happens to have a severe case of schizophrenia. Evidently and as unanimous decision of many readers, Samsa’s case of mental illness is portrayed in the novel through his bizarre and surreal appearance as a mammoth cockroach. While a great deal of readers would concur that Gregor Samsa was truly insane and was not a giant, h uman-sized cockroach, some would say that Gregor actually did metamorphose into a cockroach. The idea that Gregor actually did mutate to an alien life form is insane can be rebutted through many counteraccusations, such as biological explanations, schizophrenic personalities, and the outcomes that come alongside destitute lifestyles. Firstly, readers on the side of biology would refute that Gregor did not actually mutate into a cockroach, as Gregor’s situation is a false accusation of mutation. Explicitly stated in the first paragraph of The Metamorphosis, Gregor’s metamorphosis takes place as follows: â€Å"When Gregor Samsa woke up one morning from unsettling dreams, he found himself changed in his bed into a monstrous vermin. He was lying on his back as hard as armor plate, and when he lifted his head a little, he saw his vaulted brown belly, sectioned by arch-shaped ribshis many legs, pitifully thin compared with the size of the rest of him, were waving helpl

Employee-employer hiring relates to the concept of negligence Essay

Employee-employer hiring relates to the concept of negligence - Essay Example Therefore, employers who hire temporary employees or elevate them to permanent ones cannot lay succeed in filing claims for negligence on temp agencies that fail to run background checks. In light of this, Robert Half’s failure to disclose Ms Tee Rose’s suspected criminal past does not amount to a breach of duty to run background checks; rather, it is merely an exercise of the duty of care under the contract between itself and Ms Rose. The court’s ruling against Fox Associates was correct because the case did not meet the three-point threshold for recovering the damages arising from negligence. Fox Associates failed to establish that: (a) Robert Half owed it a fiduciary duty, hence would cushioning it against any injury caused by the employee; (b) Robert Half abdicated that duty; c) damages amounting to $76,600 proximately arose from the breach of duty. In the decision against Fox Associates the court may have given prominence to Robert Half’s social utili ty to employers; lack of foreseeability of Ross’ criminal record, since she had not been convicted of any felony; the burden of protection against injury, which in this case rested with the Fox Associates; and the repercussions of imposing the burden on the temp agency, which could force it to close down (Reicher, 2013; Nixon, & Kerr, 2011). The court’s decision was in line with the verdict on Praesel v. Johnson, 967 S.W.2d 391 (Tex. 1998), which directed that a clinician does not owe a duty to third parties such as employment agencies. In Wise v. Complete Staffing Servs., Inc., 56 S.W.3d 900, 902 (Tex. App. Texarkana 2001), the temp agency was conditionally exempted from liability arising from the employee’s misconduct (Reicher, 2013). In light of these precedents, Fox Associates should have done its own background checks on Ms Rose before employing her on permanent basis. Sunbeam is more at fault for its failure to run background checks on the senior-most exec utive prior to his hiring. Unlike the less formal relationship between the executive search agency and the Sunbeam, the employer had a valid employment contract with Mr Dunlop and its assets were more likely to be at risk in the event Mr Dunlop had criminal record (Reicher, 2013; Nixon, & Kerr, 2011). Background checks on executives should be conducted within organizations or through a contracted search consultant upon a formal consent from the potential executive regarding the nature or level of the checks. As Colaprete (2012) has suggested, Ms Ross’ former employers said nothing about the employee’s history and gave her good recommendations, perhaps because they were not a Consumer Reporting Agency tasked with probing her alleged misconduct within their respective organizations. This was strategic in the sense that the omission enabled the employers to avoid the rigorous process and costs associated with the fair treatment of Ross, considering that she had not yet be en convicted. Moreover, with the criminal investigations against Ms Rose still underway, perhaps the employers did not want to be held liable for â€Å"misrepresentation of facts† for pre-empting an on-going judicial process in the event that the outcomes of the investigations rendered the employers’ recommendations derogatory information. If I were one of her former employers, I would mention the foreseeability of Ms Ross engaging in acts of felony, but

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Actions of the Secretary of Defense Donald Rumsfeld - Essay Example Donald Rumsfeld’s decision to modify Pentagon’s covert action and intelligence was right. The Pentagon that he joined was a monolith determined to win mega wars against two opponents simultaneously. He was uncertain of America’s victory in such wars because the enemies had equal capability and strength. He anticipated for varied threats that required diverse defense capabilities rather than automatic and programmed responses. He, therefore, sought to transform the pentagon by supporting a culture that values creativity and intelligence risk-taking. It is evident that Rumsfeld did not bend both titles. The government’s war against terror calls for a remaking of Pentagon’s and CIA’s activities and incorporate strategies that were not in place by September 11. Currently, there are calls to transfer the use of drones or move the targeted killing program to the Pentagon from CIA. Propaganda is usually distorted information meant to persuade the po pulace. The internet and social media sites such as Facebook and Twitter can help people to propagate ideas, whether it is by demonizing the opponent or mobilizing support. It is also inappropriate to use social media for data-mining operation. Data-mining poses a threat to privacy. A social media can provide personal and sensitive data only for it to be used for different purposes other than the intended one. What the Pentagon did with U-Turn was beneficial though unethical. Under Title 50, the actions helped Pentagon’s intelligence gathering operations.

Song Essay Example | Topics and Well Written Essays - 1000 words - 1

Song - Essay Example nnot incorporate imaginative lyrics into their songs that seek to engage the listener with innovative and interesting ways to tackle a very limited subject matter; a subject matter that is almost invariably dealing with love and/or loss. As a means of understanding one current highly successful song that is currently experiencing a great deal of radio airtime, this particular analysis will consider Rihanna’s single â€Å"Diamonds† within the context of its use of simile, metaphor, and symbolism. As a function of understanding the ways in which these literary devices are utilized within the given song, it is the hope of this author that a new level of appreciation for the means by which songwriters seek to engage the listener with new and exciting means of describing something that has been relayed an infinite number of times before will be realized. With regards to simile within the given song in question, the very first lines of the song state: â€Å"Shine bright like a diamond† (Rihanna 1). In this way, the immediate use of simile is utilized as a way to engage the listener with the powerful imagery of a glistening diamond as reflective of the way that new love glistens and seems as something wholly and entirely unique within the realm of human experience (Gabrielsson 15). Of course the simile in this particular instance acts as more than just as simile, it provides a degree of symbolism in helping to represent the embodiment of love within the song as something akin to a rare and precious stone that radiantly proclaims itself wherever it exists. Further examples of simile in the song exist within the repeated lines â€Å"We’re like diamonds in the sky† (Rihanna 1). Such a use of simile reinforces the idea of comparison to the richness of the love that the songwriter attempts to convey to the listener (Pa lmer 39). In much the same manner metaphor is used as well within the line â€Å"You’re a shooting star I see† (Rihanna 1). Naturally, such an

Meningitis Vaccine Policy in Saudi Arabia

Meningitis Vaccine Policy in Saudi Arabia Meningitis Vaccine Policy During Hajj Overview of the Essay This essay looks at the meningitis vaccine policy during Hajj in Saudi Arabia, first looking at the healthcare system in Saudi Arabia, in terms of how the health care system is structured and what the policies towards vaccination against meningitis are. The essay then moves on to discuss more general policies towards meningitis vaccination, from the World Health Organisation (WHO), for example, and how the Saudi model of vaccination fits in to this more general framework. The essay then moves on to looking at social theories that have been suggested to explain how organisations work, in terms of understanding how meningitis can be spread through the hajjis attending the Hajj pilgrimage. The essay then moves on to look at what evidence has been gained from research in to meningitis outbreaks during Hajj, and meningitis control through vaccination. This is presented in the form of a literature review of the current, relevant, literature regarding meningitis outbreaks during Hajj, and meningitis control through vaccination. Literature that is specific to Saudi Arabia is focused on, although vaccination programmes that have been successfully attempted further afield will also be discussed. The essay then moves on to looking at how and when the current Saudi Arabian vaccination policy and how this policy differs from previous policies, in terms of why the new policy was introduced and what the positive and negative effects of this policy have been. This section incorporates research reviewed in the previous section, through the literature review of the relevant research, and also looks at how historical trends and international trends in healthcare have contributed to this policy. The impact of globalisation on health care is also discussed. The essay then moves on to discuss any gaps that are present between the stated policy and the implementation of this policy, in terms of the organisational constraints that are present that directly affect policy implementation. The next section of the essay looks at the implications of the policy for nursing practice, in terms of the direct involvement of nurses, the need for counselling and educating parents, in terms of the historical development of nursing and the international trends in nursing. Introduction The Saudi Healthcare System This section looks at how the health care system is structured in Saudi Arabia, and what the policies towards vaccination against meningitis are within the Kingdom of Saudi Arabia. The essay then moves on to discuss more general policies towards meningitis vaccination, from the World Health Organisation (WHO), for example, and how the Saudi model of vaccination fits in to this more general framework. The essay then moves on to looking at social theories that have been suggested to explain how organisations work, in terms of understanding how meningitis can be spread through the hajjis attending the Hajj pilgrimage. The healthcare system in Saudi Arabia is essentially a national health care system, provided by the Government, which is overseen by the Ministry of Health (MOH), which provides primary healthcare services through a series of health care centres scattered throughout the Kingdom. These primary care centres refer applicable cases to advanced specialist curative services based in hospitals. In addition, secondary and tertiary care is provided by a variety of Ministries, and through a variety of private and public organisations: for example, Saudi Arabian universities provide specialist care, through their research hospitals and Saudi Arabian airlines provide health care to it’s employees. Emergency care is provided by the Saudi Red Crescent Society, and is also responsible for providing medical care during the Hajj and Umra pilgrimages. Health care is free, at the point of delivery, to all Saudi citizens and expatriates working in Saudi Arabia, and the Saudi Government spends an estimated ten per cent of its annual budget on health care: this seems to be a good investment as the Saudi’s have one of the highest life expectancy in the region, although obesity is becoming a concern in Saudi Arabia, due to the introduction of the ‘Western’ diet to the region. Whilst a more than adequate health care system is provided by the Saudi Government, as has been seen, there is also a thriving private healthcare system which provides all levels of care, from primary to tertiary and including emergency medical services. The Saudi Government is also interested in reforming the health care system, with a desire to achieve coordination amongst the various sectors and to increase the number of Saudi medical and nursing graduates so that Saudi employees can work in this sector, rather than employing many hundreds of thousands of expatriate nursing and medical staff, as is currently the case. The Saudi Government is also attempting to introduce a cooperative health insurance scheme, which would cover all non-Saudi residents living and working in the country. Infection Control for the Hajj In order to attend the Hajj, vaccination against the A and C meningitis strains was made mandatory, following on from the worldwide outbreak of meningitis A which occurred following the 1987 Hajj (Fonkoua et al., 2002) and a 1992 outbreak of meningitis A which occurred amongst Umra pilgrims (Wilder-Smith et al., 2003). In addition to this requirement for travellers entering Saudi Arabia for the Hajj, all hajjis coming from countries belonging to the African meningitis belt, and those arriving from areas that had recently experienced a meningitis outbreak, were required to take a single dose of ciprofloxacin upon arrival to Saudi Arabia (WHO, 2001). This policy was in place in Saudi Arabia until the recent outbreak of the W-135 serogroup. The current concern of health professionals and health organisations is, however, the W-135 serogroup, due to the recorded outbreak of meningitis amongst Singaporean pilgrims returning from the Hajj in 2001, many of whom had been vaccinated with the quadrivalent vaccine (Wilder-Smith et al., 2003). As stated in Wilder-Smith et al. (2003), there was a massive outbreak of serogroup W-135 meningitis in the 2000 and 2001 pilgrimages, through pharyngeal carriage of the serotype in pilgrims returning from the Hajj. Wilder-Smith et al. (2003) looked at meningitis carriage during the minor pilgrimage (Umra) and found that, whilst the W-135 serotype was carried, it was at a much lower rate of incidence, at 1.3% versus the 17% found in Hajj pilgrims, leading to their conclusion that in order to reduce the potential introduction of N.meningiditis W-135 in to the countries of origin of the pilgrims, then a ttentions would be better focused on those pilgrims attending the Hajj rather than the Umra. Following on from the Hajj-associated outbreak of W-135 serogroup, the Saudi Arabian Ministry of Health changed their policy with regards to meningitis and made it mandatory for hajjis to receive the quadrivalent vaccine (against A, C, Y and W-135) as a visa requirement from 2002 for people entering Saudi Arabia for the purposes of the Hajj (Wilder-Smith et al., 2003). In addition, the Saudi Arabian Ministry of Health administers antibiotics to all local Saudi hajjis in order to eradicate the carriage of the W-135 serogroup and to reduce transmission to local contacts and to the larger community (Wilder-Smith et al., 2003). In terms of more general policies with regards to vaccination programmes against meningitis, the World Health Organisation (WHO) recommended control practices for meningitis involve vaccination with the A/C vaccine in response to epidemics, which requires that epidemics are detected early and that stocks of vaccines be set up in at-risk regions, so that vaccination can be rapid (Fonkoua et al., 2002). Whilst other outbreaks of the W-135 strain of meningitis are becoming increasingly common, such as the outbreaks in Yaounde in Cameroon (Fonkoua et al., 2002) and in Burkina Faso (which killed 1500 people of the 13000 known to have been infected), the WHO is recommends preventative vaccination to protect those individuals at risk (for example, travellers, people in the military and pilgrims) (WHO, 2003) and vaccination for those who have been in close contact with known meningitis cases. In terms of vaccination for epidemic control, the WHO recommends that in the African meningitis belt , the known hotspot for meningitis, stretching from Senegal to Ethopia, epidemics be controlled with enhanced surveillance and the use of oily chloramphenicol, with mass vaccinations for those areas in the epidemic phase and those contiguous areas that are in alert phase: such mass vaccination, promptly administered is estimated to prevent seventy per cent of cases (WHO, 2003). As shown in a 2001 WHO report (WHO, 2001) on the emergence of the W-135 strain of meningitis, infection with this strain can lead to outbreaks of considerable size and because the epidemiology of this strain is not well understood, there is a serious need for travellers to the Hajj to be protected. The 2001 outbreak of W-135 strain of meningitis at the Hajj spread worldwide with a total of 304 cases reported and this outbreak raised serious questions as to whether the W-135 strain of meningitis will become a major public health problem at national and international levels (WHO, 2001). As shown in the NHS leaflet specially designed for UK citizens and residents planning on attending the Hajj, the W-135 strain of meningitis is deadly and vaccination against the A and C strains of meningitis does not protect an individual against this more deadly strain: only the quadrivalent vaccine will protect individuals against the W-135 strain of meningitis (NHS, 2007). In terms of the WHO policy on the W-135 strain of meningitis, the WHO has stated that the currently available vaccine is too expensive to be applicable for mass vaccination programmes that are known to be effective in the prevention of the epidemic outbreak of other meningitis strains, and so the WHO is pressing for an affordable vaccine against the W-135 strain, i.e., a vaccine at a price that would be affordable in an African situation, given that the majority of outbreaks of meningitis occurring worldwide occur in the African meningitis belt (WHO, 2003). Thus, there is no widespread vaccination programme with the quadrivalent vaccine, which protects against the W-135 strain of meningitis, unlike the routine vaccination programmes with the vaccines that are effective against the A and C strains. As the WHO, the Saudi government and various Governments who deal with their citizens who attend the Hajj (for example, the UK) are recommending, it is, at the moment, sufficient that the quadrivalent vaccine is given only to those who are at risk, i.e., those who are planning on entering a region that is known to have the W-135 strain. Widespread vaccination against the W-135 strain of meningitis is not being practiced anywhere in the world, mainly, it seems, due to the high cost of the vaccine but also due to the fact that there is no scientific evidence as to the global direction of the W-135 strain of meningitis i.e., the fact that there is no evidence, as yet, to suggest that the W-135 strain of meningitis will become a global scourge (WH O, 2001) and, as such, that it is not certain, as yet, as to whether a mass vaccination against this strain is necessary. Due to this information, the Saudi Arabian government implemented a mass vaccination with the tetravalent vaccine, active against the A, C and W strains of meningitis (WHO, 2001) and put in place the controls for hajjis as previously outlined: i) making it mandatory for hajjis to receive the quadrivalent vaccine (against A, C, Y and W-135) as a visa requirement from 2002 for people entering Saudi Arabia for the purposes of the Hajj (Wilder-Smith et al., 2003); ii) administering antibiotics to all local Saudi hajjis in order to eradicate the carriage of the W-135 serogroup and to reduce transmission to local contacts and to the larger community (Wilder-Smith et al., 2003); and iii) requiring all hajjis coming from countries belonging to the African meningitis belt, and those arriving from areas that had recently experienced a meningitis outbreak, to take a single dose of ciprofloxacin upon arrival to Saudi Arabia (WHO, 2001). Social theories to explain how organisations work This section looks at some of the social theories that have been suggested to explain how organisations work, in terms of understanding how meningitis can be spread through the hajjis attending the Hajj pilgrimage. In terms of the social theories that have been suggested to explain how organisations work, in terms of understanding how meningitis can be spread through the hajjis attending the Hajj pilgrimage Bourdieu, writing in Hillier and Rooksby (2005) talks about the concept of ‘habitus’ in terms of describing both geographical and social spaces or dispositions, which Bourdieu (2005) describes as permanent manners of being, seeing, acting and thinking, a permanent structure of perception, conception and action. Bourdieu’s (2005) thinking on habitus and dispositions can be applied to participation in the Hajj, as Bourdieu (2005) widens his definition of habitus to include unity of human behaviour, or what he terms lifestyle: that is, a set of acquired characteristics which are the product of prevailing social conditions. Bourdieu (2005) argues that this habitus, this disposition, can lead to entrenched behaviours and responses, especially in religious beliefs, for example, which leads, for example, to people wishing to attend the Hajj pilgrimage as part of their religious beliefs. Other social theories that have been put forward to explain organisational behaviour include social network theory (Barnes, 1954) which explains how social networks are formed, through the formation of nodes (i.e,, individuals) which are bound together through interdependency such as values or visions or disease transmission. The use of this theory can help epidemiologists explain how, for example, meningitis is spread amongst and beyond hajjis, leading to the development of plans and policies to contain the spread of meningitis. This will be looked at in more detail later in the essay. The Evidence from the Research This section looks at what evidence has been gained from research in to meningitis outbreaks during Hajj, and meningitis control through vaccination. This is presented in the form of a literature review of the current, relevant, literature regarding meningitis outbreaks during Hajj, and meningitis control through vaccination. Literature that is specific to Saudi Arabia is focused on, although outbreaks and vaccination programmes that have been successfully attempted further afield will also be discussed. There was a massive outbreak of serogroup W-135 meningitis in the 2000 and 2001 Hajj pilgrimages, through pharyngeal carriage of the serotype in pilgrims returning from the Hajj (Wilder-Smith et al., 2003). Wilder-Smith et al. (2003) looked at meningitis carriage during the minor pilgrimage (Umra) and found that, whilst the W-135 serotype was carried, it was at a much lower rate of incidence, at 1.3% versus the 17% found in Hajj pilgrims, leading to their conclusion that in order to reduce the potential introduction of N.meningiditis W-135 in to the countries of origin of the pilgrims, then attentions would be better focused on those pilgrims attending the Hajj rather than the Umra. Outbreaks of the W-135 strain of meningitis are becoming increasingly common further afield, such as the outbreaks in Yaounde in Cameroon (reported in Fonkoua et al., 2002) and in Burkina Faso (which killed 1500 people of the 13000 known to have been infected) (reported in WHO, 2001). To this end, as will be seen, whilst there is a vaccine against the W-135 strain of meningitis, this vaccine is extremely expensive and, as such, is not suitable for mass vaccination programmes. The vaccine is currently only in usage for travellers who are expecting to travel in to high risk regions, i.e., hajjis travelling to the Hajj which happens in a known outbreak area. It is hoped, however, that the WHO lobbying of the pharmaceutical companies will produce a more affordable version of the vaccine that would then be utilised in mass vaccination programmes, particularly across the African meningitis region, in order to minimise the spread of the deadly W-135 strain of meningitis. The Saudi Arabian Vaccination Policy This section looks at the current Saudi Arabian vaccination policy and how this policy differs from previous policies, in terms of why the new policy was introduced and what the positive and negative effects of this policy have been. This section incorporates research reviewed in the previous section, through the literature review of the relevant research, and also looks at how historical trends and international trends in healthcare have contributed to this policy. The impact of globalisation on health care is also discussed. Prior to the W-135 meningitis outbreak amongst those who had attended the 2001 Hajj, and following on from the worldwide outbreak of meningitis A which occurred following the 1987 Hajj (Fonkoua et al., 2002) and a 1992 outbreak of meningitis A which occurred amongst Umra pilgrims (Wilder-Smith et al., 2003), the Saudi Arabia vaccine policy was for mandatory vaccination against the A and C meningitis strains for all hajjis, with the necessity to present a certificate of vaccination upon application for a visa to travel to Saudi Arabia for the Hajj. In 2003, similarly to many other countries, such as the UK, who also undertake such a mass vaccination scheme, the Saudi Arabian government implemented a mass vaccination with the tetravalent vaccine, which is active against the A, C and W strains of meningitis (WHO, 2001). Following the 2001 W-135 outbreak, the Saudi Arabian Government put in place several controls for hajjis: i) it became mandatory for hajjis to receive the quadrivalent vaccine (against A, C, Y and W-135) as a visa requirement from 2002 for people entering Saudi Arabia for the purposes of the Hajj (Wilder-Smith et al., 2003); ii) the Saudi Arabian Government administered antibiotics to all local Saudi hajjis in order to eradicate the carriage of the W-135 serogroup and to reduce transmission to local contacts and to the larger community (Wilder-Smith et al., 2003); and iii) it became a requirement for entry to the country that all hajjis coming from countries belonging to the African meningitis belt, and those arriving from areas that had recently experienced a meningitis outbreak, were to take a single dose of ciprofloxacin upon arrival to Saudi Arabia (WHO, 2001). In terms of how international trends in healthcare and globalisation have contributed to these changes in the policy of the Saudi Arabian Government towards controlling meningitis, whilst the Hajj has always attracted pilgrims from all over the world, only recently has the deadly W-135 strain of meningitis reared its head, presenting a potentially disastrous scenario if this disease became epidemic as a consequence of the ideal conditions for disease replication that the Hajj presents. Thus, the Saudi Arabian Government has had to work fast to draw up a policy that minimises, as far as possible, the chances of a W-135 epidemic. The Saudi Arabian response to this threat has been impressive, in terms of drawing up practical, preventative measures so quickly and putting these in to practice so quickly. Globalisation has speeded up international travel and, through globalisation, the world has become, in a very real sense, smaller. One can literally travel wherever one desires, faster than ever before. The fact that there was an outbreak of W-135 in Singapore, amongst Singaporean hajjis, shows that what could once, historically, have been an isolated outbreak of such a deadly disease now has the potential to affect many thousands of individuals, as those infected could, potentially, travel on many different modes of transport, across many thousands of miles, coming in to contact with many different individuals, who could then become carriers of the disease, spreading the disease far afield and leading to different outbreaks of the same disease in places where the disease has never been reported previously. Problems Facing the Policies in Place to Prevent Meningitis Outbreaks During the Hajj This section discusses the gaps that are present between the stated policy and the implementation of this policy, in terms of the organisational constraints that are present that directly affect policy implementation. The actual situation of meningitis control amongst hajjis requires attention, as it is known that many hajjis enter Saudi Arabia illegally and thus are not reached by formal checks or health services whilst entering Saudi Arabia (WHO, 2001). This leads to the situation where diseases could be spread through an individual slipping through the many and varied controls that have been put in place by the Saudi Arabian Government, as it is known that many of these illegal immigrants come from countries that do not have vaccination programmes in place and who, therefore, are highly unlikely to have been vaccined prior to travelling to Saudi Arabia for the Hajj. For this reason, aside from the formal border controls on entry of hajjis, vaccination posts have been established in the last few years around the Holy Mosque (WHO, 2001). In addition, risks are presented by the arrival, at Saudi Arabian border entry ports, of individuals bearing false vaccination certificates. This presents a particular problem as these individuals put at risk the Saudi Arabian control policies that are in place, through the fact that these individuals may be carriers of disease, and may pass disease to the hajjis, but also because the need to vaccinate these individuals, often numbering in to the thousands, costs the Saudi Arabian Government time and money, paying for and administering the vaccine, a vaccine that is in short global supply and which is expensive (WHO, 2001). In terms of minimising the chances of such problems occurring, the Saudi Arabian Government has been in close talks with the Governments of countries of the African meningitis belt to offer direct, on the spot, help with vaccination programmes, donating vaccines to those countries who cannot afford them and opening temporary health centres in those countries that do not have the necessary infrastructure for the administration of said vaccines (WHO, 2001). The Saudi Arabian Government is also involved in research looking at, for example, carriage prevelance of meningitis strains in Mecca and the impact of mass chemoprophylaxis with ciprofloxacin (Who, 2001). Thus, whilst there are gaps that are present between the stated policy and the implementation of this policy, in terms of the organisational constraints that are present that directly affect policy implementation, the Saudi Arabian Government seems, really, as shown through this in-depth study, to be doing literally all it can to attempt to control, as far as possible, the outbreak of various strains of meningitis amongst hajjis during Hajj. Implications of the Saudi Arabian Policy for Nursing Practice The next section of the essay looks at the implications of the policy for nursing practice, in terms of the direct involvement of nurses, the need for counselling and educating parents, in terms of the historical development of nursing and the international trends in nursing. There are many and varied problems presented to UK nurses by the Saudi Arabian policy on vaccination against meningitis, in terms of the fact that UK nursing staff need training to understand the cultural significance of the Hajj to their muslim patients, in order to understand any potential requests for vaccination and to diagnose any potential diseases on their return from the Hajj. Nurses dealing directly with hajjis also require further training in the current vaccination requirements for hajjis, as determined by the Saudi Arabian Government’s vaccination policy, as shown through their visa requirements, in order to administer the correct, required, vaccines. The nursing staff in contact with hajjis should also be fully versed in the symptoms of all types of meningitis (including the deadly W-135) and other diseases that could be contracted whilst undertaking the Hajj, in order for timely diagnoses to be made, and timely treatment to be delivered to the patient. The fact that there was an outbreak of W-135 in Singapore, amongst Singaporean hajjis, shows that what could once, historically, have been an isolated outbreak of such a deadly disease now has the potential to affect many thousands of individuals, as those infected could, potentially, travel on many different modes of transport, across many thousands of miles, coming in to contact with many different individuals, who could then become carriers of the disease, spreading the disease far afield and leading to different outbreaks of the same disease in places where the disease has never been reported previously. Thus, globalisation has led to the situation where nursing staff need to be attuned to the possibility of ‘local’ patients presenting with ‘tropical’ or ‘foreign’ diseases. Whilst there is a system of reporting set up for such diseases, the early diagnosis of such diseases is often mistaken for common ailments, such as flu, for example, and diagnosis and treatment delayed, often leading to the spreading of the disease whilst the patient is ‘at large’ and not contained. This was the case in the 2001 outbreak of W-135 meningitis in the UK, with only 8 of the 51 total cases being actual pilgrims and 22 cases being contacts of the pilgrims, with 21 cases not having any apparent contact with the pilgrims: transmission was maintained for several months prior to diagnosis which is suspected to have led to many of the additional cases (WHO, 2001). Thus, nursing staff in countries that host Hajj attendees, such as the UK, need to be aware not only of current policies which affect the vaccination requirements of hajjis, but also of diseases that could be contracted whilst at the Hajj, in terms of knowing what symptoms to look for in patients returning from the Hajj. Saudi Arabian policies that are aimed at controlling the spread of meningitis during the Hajj thus not only have an effect on Saudi Arabian nursing staff, in terms of requiring them to administer any necessary vaccines and/or other medication, but also have a direct impact on nursing staff in those countries that host hajjis, for example, the UK, requiring special training for nursing staff. Conclusion This essay has looked at the meningitis vaccine policy during Hajj in Saudi Arabia, first looking at the healthcare system in Saudi Arabia, in terms of how the health care system is structured and what the policies towards vaccination against meningitis are. It was seen that the Saudi Arabian policies to vaccination against meningitis have changed somewhat in light of the 2001 outbreak of the W-135 strain of meningitis, which led to a tightening of requirements for entry to the country for the purposes of the Hajj and to a widespread vaccination programme across Saudi Arabia, and a local vaccination and medication programme in the immediate vicinity of the Hajj sites. The essay then moved on to discuss more general policies towards meningitis vaccination, from the World Health Organisation (WHO), for example, and how the Saudi model of vaccination fits in to this more general framework. As seen, the WHO is concerned that a major outbreak of the W-135 strain of meningitis could not be controlled, due to the high cost of the vaccine; the Saudi mondel fits in to this general framework in terms of aiming to prevent an outbreak not through mass vaccination with the quadrivalent vaccine but through the careful control of individuals entering the Hajj zone. The essay then moved on to looking at social theories that have been suggested to explain how organisations work, in terms of understanding how meningitis can be spread through the hajjis attending the Hajj pilgrimage, showing that many social theories are applicable to explain how diseases are transmitted across the Hajj period. The evidence that has been gained from research in to meningitis outbreaks during Hajj was then discussed, as was the historical treatment of meningitis control through vaccination. This was presented in the form of a literature review of the current, relevant, literature regarding meningitis outbreaks during Hajj, and meningitis control through vaccination. Literature that is specific to Saudi Arabia was focused on, although vaccination programmes that have been successfully attempted further afield were also discussed. The essay then moved on to look at how and when the current Saudi Arabian vaccination policy has changed, and how this policy differs from previous policies, in terms of why the new policy was introduced and what the positive and negative effects of this policy have been. It was shown that, prior to the W-135 meningitis outbreak amongst those who had attended the 2001 Hajj, and following on from the worldwide outbreak of meningitis A which occurred following the 1987 Hajj (Fonkoua et al., 2002) and a 1992 outbreak of meningitis A which occurred amongst Umra pilgrims (Wilder-Smith et al., 2003), the Saudi Arabia vaccine policy was for mandatory vaccination against the A and C meningitis strains for all hajjis, with the necessity to present a certificate of vaccination upon application for a visa to travel to Saudi Arabia for the Hajj. In 2003, similarly to many other countries, such as the UK, who also undertake such a mass vaccination scheme, the Saudi Arabian government implemented a mass vaccination with the tetravalent vaccine, which is active against the A, C and W strains of meningitis (WHO, 2001). Following the 2001 W-135 outbreak, the Saudi Arabian Government put in place several controls for hajjis: i) it became mandatory for hajjis to receive the quadrivalent vaccine (against A, C, Y and W-135) as a visa requirement from 2002 for people entering Saudi Arabia for the purposes of the Hajj (Wilder-Smith et al., 2003); ii) the Saudi Arabian Government administered antibiotics to all local Saudi hajjis in order to eradicate the carriage of the W-135 serogroup and to reduce transmission to local contacts and to the larger community (Wilder-Smith et al., 2003); and iii) it became a requirement for entry to the country that all hajjis coming from countries belonging to the African meningitis belt, and those arriving from areas that had recently experienced a meningitis outbreak, were to take a single dose of ciprofloxacin upon arrival to Saudi Arabia (WHO, 2001). In terms of how historical trends and international trends in healthcare have contributed to this policy, and the impact of globalisation on health care, it was shown that globalisation has meant that diseases can spread far more rapidly and widely than ever before, and that this has grave consequences in terms of deadly diseases such as the W-135 strain of meningitis. Various problems for the Saudi Arabian vaccination policy were then discussed, and the relevant solutions were given, and then the essay moved on to discussing the role of nurses involved in the care potential hajjis and of returning, infected, hajjis, in terms of the implications of the Saudi Arabian vaccination policy for nursing practice, in terms of the direct involvement of nurses, the need for counselling and educating parents, and in terms of the historical development of nursing and the international trends in n

Computers in Elementary Education :: School Technology Papers

Computers in Elementary Education When trying to describe the meaning of education, one might think of the relationship between a teacher and a student. The essence of this relationship is stregthned by the teachers' ability to adapt to the students needs. With many advancements of society and technology, today's teachers are better equipped with tools so powerful that the standards of yesterday are being challenged more frequently. Among these great tools exists the computer and the Internet. Unfortunately, history reveals that great tools often have their consequences. For example, how great must it have been to be among the first few to use a knife thousands of years ago. We all know, just as those first few might have found out, that with all the positive and useful ways we can use knives, there are just as many evil ways we can use them. With the help of the media as well as first hand use, millions of people already know of the risks having to deal with computers and the Internet. Another issue that plays a factor is the tradition as a whole. It might be possible that a few of the teachers around the world fear being replaced by a machine. Can the computer really substitute the help and guidance of a teacher? This idea itself raises another issue. Deciding how many computers per school, how many computers per class, how many lessons involving computers, whether Internet access should be granted, and planning security issues with expensive equipment is not going to be an easy task. I believe everyone is very excited right now about having computers in their classrooms. It's also happening at the elementary school where I am currently working as a T.A. There will be at least one computer in each classroom. The fourth and fifth grade classes have more than one because they have projects that they can type during class or they have any other activity that will enhance their computer abilities. I work in a kindergarten class and when the children were told they wer e going to have a computer in their room they all said, "yeeaaahhh." I would be excited too because they're only thinking about the computer games that are going to be available for them. They're not thinking that their whole instruction is going to be in front of the computer. The decision making responsibilities are probably going to be left to the government.

Capital Market Theory Rsm 332 – Week 2

CAPITAL MARKET THEORY RSM 332 – Week 2 Week 1 – Introduction – Financial Accounting (Review) Week 2 – Financial Markets and Net Present Value Week 3 – Present Value Concepts Week 4 – Bond Valuation and Term Structure Theory Week 5 – Valuation of Stocks Week 6 – Risk and Return – Problem Set #1 Due Week 7* – Midterm (Tuesday*) Week 8 – Portfolio Theory Week 9 – Capital Asset Pricing Model Week 10 – Arbitrage Pricing Theory Week 11 – Operation and Efficiency of Capital Markets Week 12 – Course Review – Problem Set #2 Due Contact: otto. [email  protected] utoronto. ca CAPITAL MARKET THEORY RSM 332 – Week 2AGENDA 1. 2. 3. 4. 5. Announcements Financial Markets and Net Present Value Survey Results Optional Material (e. g. Cases, Practical Knowledge, News, etc. ) Suggestions/Practice for Exam(s) Contact: otto. [email  protected] utoronto. ca Extended Office Hours Friday , October 19th (11:00am-3:00pm) †¢ Room 6 – TZ6 (Tanz Neuroscience Bldg – 6 Queen’s Park Crescent West) TBD – Saturday, October 20th †¢ Depends if there is enough demand Thursday, October 25th (5:00pm-7:00pm and 7:00pm-9:00pm) †¢ During regular timeslot †¢ Cover optional material (e. g. cases, practical knowledge, etc. ) Contact: otto. [email  protected] utoronto. ca Exams Midterm (Tuesday, October 23rd – 8:00pm-10:00pm): †¢ EX 100 (Examination Facility – 255 McCaul Street) †¢ 2 Hours Final (TBA): †¢ 2 Hours Preparation: †¢ Problem Sets 1 & 2 †¢ Crib Sheet (Start Early and 1-Sided) †¢ Calculator (Silent) Contact: otto. [email  protected] utoronto. ca Tutorials †¢ Starting – September 19/20/21 †¢ Wednesday (6:00pm-8:00pm) †¢ TZ6 (Tanz Neuroscience Bldg – 6 Queen’s Park Crescent West) †¢ Thursday (11:00am-1:00pm) †¢ RW 110 (Ramsay Wright Laborat ories – 25 Harbord Street) †¢ Friday (5:00pm-7:00pm) †¢ RW 110 (Ramsay Wright Laboratories – 25 Harbord Street) Review: †¢ Midterms and Finals (2008-2011) Xiaofei Zhao (xiaofei. [email  protected] utoronto. ca) †¢ http://332ta. raykan. com †¢ Contact: otto. [email  protected] utoronto. ca Outside of Lecture Office Hours (Drop-In): †¢ Wednesdays: 4:00pm-6:00pm †¢ 105 St. George Street – Rotman (North Building) Room 413 or 417 Office Hours (Other Days/Times): †¢ Extended Hours †¢ By Appointment Contact: otto. [email  protected] utoronto. ca Corporate Finance: What is Going On? 3) Firm’s Financial (5) Investors (4) (Financial Institutions, (1) Individuals, Other Firms) (1) (2) (3) (4) (5) Cash raised from investors by selling financial assets Cash invested in real assets (some are intangible) Cash generated by operations Cash reinvested in the firm (retained earnings) Cash repaid to investors (interest, divi dends, etc. ) Operations (2) Decision Maker Reference: Alex MacKay Financial Markets: What is Going On? Firms (Users of Capital) Initial Public Offering (IPO) Secondary Offerings (SEO) Borrowing (Loans, Bonds)Dividends, $ Repurchases, Interest Payments $ Market Mechanisms or Market Makers (Stock Exchanges, Banks, Investment Funds, †¦) $ $ Firms Issue Stock Certificates and Bonds $ $$$ Invested in Stocks and Bonds Investors (Providers of Capital) Investment Banks help firms make transactions Brokers/Dealers help investors make transactions Reference: Alex MacKay Financial Theory and Corporate Policy Chapter 1 (Copeland, Weston and Shastri) Course Reserve FINANCIAL MARKETS AND NET PRESENT VALUE Consumption Plan and Investment RuleConsider 1 period problems Assumptions: †¢ No uncertainty †¢ One period (two dates), consumptions occur on date 0 and date 1 †¢ A consumer is endowed with initial wealth (Y0) on date 0, and will receive income (Y1) on date 1 †¢ Simple interest rate (r) Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment Rule 4 CASES †¢ Case I: †¢ Case II: No Capital Market, No Production Opportunities With Capital Market, No Production Opportunities †¢ Case III: No Capital Market, With Production Opportunities †¢ Case IV: With Capital Market, With Production OpportunitiesReference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Consumption and Investment without Capital Markets C1 U2 U1 U0 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 Slope of the Tangent (-ve) = (Marginal Rate of Substitution) (MRS) MRS = ? C1 ? C0 U1 U(C0, C1) MRS = ? U / ? C0 ?U / ? C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Poli cy) 4 th Edition 2004 Consumption and Investment without Capital MarketsC1 Production/Investment Opportunity Set C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 Rate at which a dollar of consumption today (C0) is transformed by productive investment into a dollar of consumption (C1) tomorrow. C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 Marginal Rate of Transformation (MRT) MRT = ? C1 ? C0 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 U1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 Y1 U1 Resource Bundle: (Y0, Y1) Y0Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment without Capital Markets C1 Increase investment until MRT = MRS U1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 U2 U1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital MarketsC1 MRT = MRS U2 U1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment without Capital Markets C1 U2 U1 (Increase Investment) Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 Slope = -(1+r) Borrowing and Lending opportunities (Capital Market Line) (at market interest rate r) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets C1 Interest plus Principal (Invest/Lending) Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 Interest plus Princip al (Borrowed Amount – Principal) Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 U1 C0Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets C1 Y1 U1 Endowment: (Y0, Y1) Y0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 (Invest) Y1 U1 Y0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1Market rate of return > Subjective Time Preference (1+r) > (1+rtime preference) Y1 U1 Y0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 U1 (Consume Less) Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 U1 (Invest) Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0Edition 2004 Consumption and Investment with Capital Markets C1 U2 Y1 U1 Y0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets C1 Market Interest Rate = Subjective Time Preference U2 Y1 U1 Y0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th C0 Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 U1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] toronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 C0 Reference: Copeland, W eston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 U3 = (production and capital market) U2 = (with production alone) U1 = (initial endowment) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption Plan and Investment RuleConsider 1 period problems Assumptions: †¢ No uncertainty †¢ One period (two dates), consumptions occur on date 0 and date 1 †¢ A consumer is endowed with initial wealth (Y0) on date 0, and will receive income (Y1) on date 1 †¢ Simple interest rate (r) Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment Rule 4 CASES †¢ Case I: †¢ Case II: No Capital Market, No Production Opportunities With Capital Market, No Production Opportuni ties †¢ Case III: No Capital Market, With Production Opportunities †¢ Case IV: With Capital Market, With Production Opportunities Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Consumption Plan and Investment Rule CASE I – No Capital Market, No Production Opportunities †¢ Consumer can consume Y0 on date 0, and Y1 on date 1 Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment Rule CASE II – With Capital Market, No Production Opportunities The set of consumption plans is broadened 1. 2. Consumer can save from Y0, invests in financial assets, and consumes more on date 1 Borrow against Y1, consume more on date 0, pay back loan with interest on date 1 from Y1, and consume less on date 1 Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment Rule CASE II – With Capital Market, No Production Opportunitie s †¢ Denote C0 and C1 as date 0 and date 1 consumption respectively †¢ Constraint on them is: C1 = (Y0 – C0) (1+r) + Y1 Consumption Budget Line (Constraint) C0 + C1 = Y0 + Y1 1+ r 1+ r Y Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 In general, the consumer will be better off with capital markets Consumption Plan and Investment Rule CASE II – With Capital Market, No Production Opportunities Present Value †¢ For any cash flow, C0, C1, define its present value as: PV = C0 + C1 + r †¢ Budget constraint can be restated as: †¢ The present value of consumption equals the present value of income Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment Rule CASE II – With Capital Market, No Production Opportunities Example: †¢ Assume an investor has a wealth of $1. 5M on date 0, and will have an income of $0. 55M on date 1 †¢ The intere st rate is 10%. †¢ The present value of total income is: $2M = $1. 5M + $0. 55M (1+ 0. 10) Date 0 Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Date 1 Consumption Plan and Investment RuleCASE III – No Capital Market, With Production Opportunities Physical Investment †¢ Suppose the consumer is also an entrepreneur who identifies a physical investment opportunity †¢ Initial investment requires $0. 5M on date 0 †¢ Return of $0. 85M on date 1 †¢ Should this consumer/investor take this project? †¢ Without a capital market, it depends on her/his utility function Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Consumption Plan and Investment Rule CASE IV – With Capital Market, With Production Opportunities †¢ By investing $0. 5M in a financial asset, receive $0. 55M in return (i. . 10% return) †¢ By investing $0. 5M in a physical asset, receive $0. 85M in return (i. e. 70% return) †¢ Consumer/Investor should take this project †¢ Interest rate is also called the opportunity cost of capital †¢ i. e. Return foregone by investing in a project rather than in comparable investment alternatives Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Consumption Plan and Investment Rule CASE IV – With Capital Market, With Production Opportunities Net Present Value (NPV) †¢ Is the project’s net contribution to wealth (i. e. present value minus initial investment) NPV = C0 + C1 1+ r In the above example, the NPV of the project is: NPV = -$0. 5M + $0. 85M = $0. 2727M (1 + 0. 10) Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca Consumption Plan and Investment Rule CASE IV – With Capital Market, With Production Opportunities NPV Rule †¢ States that: †¢ If a project has a positive NPV, we should accept it †¢ If a project has a negative NPV, we should reject it Equivalent Rules †¢ NPV Rule – Accept positive NPV projects †¢ Rate-of-Return Rule – Invest in projects which offer a rate higher than the cost of capital Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation Theorem You are at a Honda (HMC) shareholders’ meeting †¢ Three shareholders are quite vocal about what the company should do Shareholder #1 – Old Lady †¢ Wants money right now †¢ Wants HMC to invest in sports cars which will yield a quick profit Shareholder #2 – Representative of a Little Boy’s Trust Fund †¢ Wants money a long way in the future †¢ Wants HMC to invest in building electric cars Shareholder #3 – Young Professional †¢ Wants money at some specified time in future (i. e. 10 years) †¢ Wants HMC to build smaller cars because of an expected oil crisis Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation TheoremWhat do you think Honda manag ers should do? Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation Theorem What do you think Honda managers should do? MAXIMIZE VALUE Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation Theorem In general, each shareholder may want: †¢ Maximum wealth †¢ Ability to transfer wealth across time into consumption †¢ Choose risk characteristics of consumption plan Each shareholder, however, can: †¢ Achieve own consumption plan through investments in financial assets †¢ Achieve risk characteristics of plan by investing in more or less risky securitiesEQUITY (CAPITAL GAINS, DIVIDENDS) Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation Theorem In general, each shareholder may want: †¢ Maximum wealth †¢ Ability to transfer wealth across time into consumption †¢ Choose risk characteristics of consumption plan Each shareholder, however, can: †¢ Achieve own consumption plan through investments in financial assets †¢ Achieve risk characteristics of plan by investing in more or less risky securities EQUITY (CAPITAL GAINS, DIVIDENDS) DEBT (INTEREST) TAX AGENCY COSTS Reference: Raymond Kan Contact: otto. [email  protected] utoronto. ca A Separation Theorem In general, each shareholder may want: †¢ Maximum wealth †¢ Ability to transfer wealth across time into consumption †¢ Choose risk characteristics of consumption plan Each shareholder, however, can: WHAT TYPE OF INCOME DO YOU PREFER? †¢ Achieve own consumption plan through investments in financial assets †¢ Achieve risk characteristics of plan by investing in more or less risky securities EQUITY (CAPITAL GAINS, DIVIDENDS) DEBT (INTEREST) TAX AGENCY COSTS Reference: Raymond Kan Contact: otto. [email  protected] utoronto. caConsumption and Investment with Capital Markets (With Production Set) C1 U3 = (production and capital market) U2 = (with producti on alone) U1 = (initial endowment) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 Choose the optimal production decision by taking on projects until the marginal rate of return on investment equals the objective market rate) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 (Choose the optimal consumption pattern by borrowing or lending along the capital market line to equate your subjective time preference with the market rate of return) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] toronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 (Production/Investment Decision) (Consumption Decision) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 (Production/Investment Decision) (Consumption Decision) (Fisher Separation Theorem) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004Consumption and Investment with Capital Markets (With Production Set) C1 (Fisher Separation Theorem) Given perfect and complete capital markets, the production decision is governed solely by an objective market criterion (represented by maximizing attained wealth ) without regard to individuals’ subjective preferences that enter into consumption decisions C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 (Production/Investment Decision) (Consumption Decision) Fisher Separation Theorem) C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 (Production/Investment Decision) (Consumption Decision) (Fisher Separation Theorem) MRS = MRT = 1+r C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Consumption and Investment with Capital Markets (With Production Set) C1 ALL INDIVIDUALS USE THE SAME TIME VALUE OF MONEY (i. e. ame market interest rate) IN MAKING THEIR PRODUCTION/INVESTMENT DECISIONS (Fisher Separation Theorem) MRS = MRT = 1+r C0 Reference: Copeland, Weston, Shastri (Financial Theory Contact: otto. [email  protected] utoronto. ca and Corporate Policy) 4 th Edition 2004 Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). Contact: otto. [email  protected] utoronto. caReference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 1. 2. 3. Which investment should Ronal d invest in, AAA or BBB? How much should he invest? If Ronald makes investment describe his cash flows? (i. e. Consumption spending divided equally in present value terms) Contact: otto. [email  protected] utoronto. ca Reference: Don Brean ExampleRonald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 1. Which investment should Ronald invest in, AAA or BBB? Contact: otto. [email  protected] utoronto. ca Reference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today).Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 1. Which investment should Ronald invest in, AAA or BBB? Contact: otto. [email  protected] utoronto. ca Reference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 1. Which investment should Ronald invest in, AAA or BBB? 2. How much should he invest? Contact: otto. [email  protected] toronto. ca Reference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 3. If Ronald makes investment describe his cash flows? (i. e. Consumption spending divided equally i n present value terms) Contact: otto. [email  protected] utoronto. ca Reference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother.Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 3. If Ronald makes investment describe his cash flows? (i. e. Consumption spending divided equally in present value terms) PV of Wealth = PV of Consumption PV (C0) = PV (C1) (i. e. C0 = C1 / (1+r) ) NPVBBB Ronald’s PV of Wealth = $400 + $1,000 + $87. 27 = $1,487. 27 $1,487. 27 = C0 + C1 / (1+r) = C0 + [C0 (1+r)] / (1+r) C0 = $743. 64 and C1 = $818 Contact: otto. [email  protected] utoronto. ca Reference: Don Brean ExampleRonald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest r ate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 3. If Ronald makes investment describe his cash flows? (i. e. Consumption spending divided equally in present value terms) C0 = $743. 64 Investment in BBB Cash Flow Requirement (CF0) = ($743. 64 + $300) = $1,043. 64 Borrowing Requirement = CF0 – $400 = $643. 64 Contact: otto. [email  protected] utoronto. ca Reference: Don Brean ExampleRonald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). 3. If Ronald makes investment describe his cash flows? (i. e. Consumption spending divided equally in present value terms) C1 = $818 Return from BBB Cash Inflow (next year) = $1,100 + $426 = $1,526 Cash Ou tflow (next year) = $818 + $643. 64 + $64. 36 = $1,526 Loan Repayment Interest on Loan @ 10% Contact: otto. [email  protected] utoronto. a Reference: Don Brean Example Ronald, a finance student, has $400 cash-on-hand and has $1,100 in trust from his grandmother. Ronald will receive the trust funds next year. (Market interest rate is 10% or trust funds worth $1,000 today). Ronald has 2 mutually exclusive investment opportunities (i. e. AAA and BBB rated investments). CONCLUDING THOUGHT Ronald’s optimal investment decision (i. e. $300 in BBB) is independent or separate from his decision as to how he inter-temporally allocates his consumption (i. e. C0 and C1) The independence of those two decisions is referred to as the Fisher Separation Theorem. Contact: otto. [email  protected] utoronto. ca Reference: Don Brean â€Å"GET TO KNOW YOU† SURVEY (Name: Optional) Question #1: †¢ What has occurred in your other courses that you were happy about and would like to be i ncorporated into this course ? †¢ What has occurred in your other courses that you were NOT happy about? Question #2: †¢ Anything specific you would like to learn? What are your learning goals in this course? †¢ Any specific requests from the instructor, TAs, program, other support staff, etc? Question #3: †¢ Are you thinking of pursuing further education in Finance, if not then what do you have in mind? And/or†¦ What job(s) are you interested in?Question #4: †¢ Tell me more about yourself (e. g. goals, program concentration, 2nd or 3rd year, etc†¦ ) Question #5: †¢ Any other comments, requests, suggestions, etc? TAKE ~3 MINUTES INDIVIDUALLY TO FILL OUT SURVEY TAKE ~ 5 MINUTES TO TALK TO 5 CLASSMATES WHOM YOU HAVEN’T MET YET (write down initials) SURVEY RESULTS (SUMMARY) †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ Real world experiences, practica l (real-world) examples, cases†¦ Relevant news (where to find news), Current issues in the market Relate course material to real world Exam tips/techniques Applications and excel models used in the real world Interactive class, games, videos†¦Extended office hours (availability) to address questions Humour Practice questions and solutions; Past exams and solutions Capital markets (high-level overview) Typical jobs in finance, Leading finance organizations Additional tutorial time Stock picking, portfolio allocation/analysis, investment tools/strategies, trading tips Learning topics that can be applied in real life Relate designations/roles to course material and applications Better understanding of financial instruments (e. g. Mortgages, bonds, etc†¦ ) View of finance from other functional areas (e. g. Marketing) 13 Popular Case Studies (Failures) 1. 2. 3. 4. 5. . Barings (Bank) – Operational Risk (Trading Activities – From arbitrageur to speculator) Nat ional Australia Bank – Operational and Market Risks (Currency Trading) Bankgesellschaft Berlin (Bank) – Credit and Operational Risks (Loans to Property Developers) Taisei Fire and Marine Insurance Co – Insurance & Governance Risks (Uninsured exposure – Lack of understanding) Washington Mutual (Bank) – Credit, Regulatory and Governance Risks; Stress and Scenario Testing (Low lending standards and bad quality acquisitions) Fannie Mae and Freddie Mac – Credit, Market, Operational, Regulatory Governance and Moral Risk; Politicians vs.Financial Risk Management (Sub-prime loans) Long-Term Capital Management – LTCM (Hedge Fund) – Market & Model Risks (Short liquid vs. Long Illiquid Investments (e. g.Bonds) – Russia Defaulted) Bankers Trust (Bank) – Operational Risk (Misled clients on derivatives sold to them) Orange County – Market and Interest Rate Risks (Wrong way bet on interest rates – Borrowing Short a nd Investing Long – Interest Rates Increased) Northern Rock (UK Bank) – Portfolio, Capital Funding, Operational and Reputational Risks; Stress and Scenario Testing (Sub-prime mortgages – Bank Run) Metallgesellschaft AG (Energy Group) – Market Risks (Cash Flow Issues from Written Forwards) Worldcom (Telecom) – Operational Risks (Accounting Fraud – Massive cquisitions & Debt) China Aviation Oil (Singapore) – Market and Governance Risks (Misreported oil futures trading losses, Un-hedged open short positions, Oil Prices Increased) Source: PRMIA 7. 8. 9. 10. 11. 12. 13. SURVEY AND BREAK 13 POPULAR CASE STUDIES Midterm 2011 – Q3 Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part A – Assume that there is no capital market, which investment, A or B, will Jack choose? Justify your answer with calculations (6 marks) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part A  œ Assume that there is no capital market, which investment, A or B, will Jack choose?Justify your answer with calculations (6 marks) †¢ If Jack does not invest, his utility is zero †¢ If Jack makes investment A (Utility is ? ) †¢ If Jack makes investment B (Utility is ? ) †¢ Y0 = $500 and Y1 = $0 †¢ Savings = Investment = Y – C Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part A – Assume that there is no capital market, which investment, A or B, will Jack choose? Justify your answer with calculations (6 marks) †¢ Investment A †¢ UA = (500-244)1/4 (400)1/2 = 80 Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Contact: otto. [email  protected] utoronto. caPart A – Assume that there is no capital market, which investment, A or B, will Jack choose? Justify your answer with calculations (6 marks) †¢ Investment B †¢ UB (I) = (500-I)1/4 (50(I)1/2)1/2 †¢ UB (I) = (5 0)1/2 [(500-I)I]1/4 †¢ Find I* by differentiating UB (I) wrt I (set to zero) †¢ dUB(I) = (50)1/2 (1/4) [(500-I)I]-3/4 (500-2I) dI I* = 250 Derivatives (Review) Reference: Martin J. Osborne http://www. economics. utoronto. ca/osborne/MathTutorial/CLCF. HTM Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part A – Assume that there is no capital market, which investment, A or B, will Jack choose?Justify your answer with calculations (6 marks) †¢ Investment B †¢ UB (250) = (50)1/2 [(500-I)I]1/4 †¢ UB (250) = 111. 80 †¢ UB > UA Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part A – Assume that there is no capital market, which investment, A or B, will Jack choose? Justify your answer with calculations (6 marks) †¢ Note: Two methods to calculate I* †¢ 1st method (take derivative of Utility Function) †¢ What’s the 2nd method? Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Alternatively – Investment B Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) (Assume a perfect capital market for borrowing and lending exists and the market interest rate is 20%) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ Jack will choose the investment with the highest NPV †¢ Calculate NPVA and NPVB Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ NPVA = -$244 + ($400)/(1+0. 20) = $89. 33 Contact: otto. [email  p rotected] utoronto. ca Midterm 2011 – Q3 Contact: otto. [email  protected] utoronto. ca Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ To solve for NPVB †¢ Need to find optimal investment (I*) †¢ set MRT = -(1+r) = -1. 20 I* = $434. 03 †¢ MRT = – dF/dI = -25/(I1/2) = -1. 20 †¢ F = 50 ($434. 31/2) = $1041. 67 †¢ NPVB = -$434. 03 + ($1041. 67/1. 20) = $434. 03 Midterm 2011 – Q3 Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ To solve for optimal consumption plan (i. e. C0*and C1*) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ To solve for optimal consumption plan (i. e. C0*and C1*) †¢ Total Wealth = $500 + $434. 03 = $934. 3 (set equal to C0 + C1/(1+r)) †¢ PV Wealth = PV Consumption †¢ C1 = 1120. 84 – 1. 2C0 Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Contact: otto. [email  protected] utoronto. ca Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ To solve for optimal consumption plan (i. e. C0*and C1*) †¢ Total Wealth = $500 + $434. 03 = $934. 03 (set equal to C0 + C1/(1+r)) †¢ U(C0, C1) = C01/4 (1120. 84 – 1. 2C0 )1/2 †¢ dU/dC0 = (1/4)C0-3/4 (1120. 84 – 1. 2C0)1/2 – 1. 2 x (1/2)C01/4(1120. 4 – 1. 2C0)-1/2 †¢ Setting it equal to zero: 1120. 84 – 1. 2C0 = 2. 4C0 C0* = $311. 34 †¢ C1* = 1120. 84 – 1. 2C0 = $747. 22 Midterm 2011 – Q3 Part B – Which investment, A or B will Jack choose? What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) (Assume a perfect capital market for borrowing and lending exists and the market interest rate is 20%) †¢ Alternatively: To solve for optimal consumption plan (i. e. C0*and C1*) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part B – Which investment, A or B will Jack choose?What is his utilitymaximizing investment I* and the optimal consumption plan? (6 marks) †¢ Alternatively: To solve for optimal consumption plan (i. e. C0*and C1*) †¢ MRS = – (1+r), which leads to †¢ – (C1/2C0) = 1. 2 C1 = 2. 4 C0 †¢ Budget constraint: C0 + C1 / (1+r) = Total Wealth = $934. 03 C1 = 1120. 84 – 1. 2C0 C0* = $311. 34 C1* = $747. 22 Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part C – Jack can hire a worker to supervise one investment for him. As a result, he can now invest in both production opportunities if he wants.If he hires a worker, he has to pay wages in equal instalments (i. e. Same wage today and next period). What maximum wage per period would Jack be willing to pay? (4 marks) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part C – Jack can hire a worker to supervise one investment for him. As a result, he can now invest in both production opportunities if he wants. If he hires a worker, he has to pay wages in equal instalments (i. e. Same wage today and next period). What maximum wage per period would Jack be willing to pay? (4 marks) †¢ NPVA = $89. 33 = W + (W/1. 20) †¢ W = $48. 3 (i. e. Maximum wage per period) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part D – Jill earns an income of $250 today and $250 next period but has no access to any production opportunities. She can, however spend some money today to purchase investment opportunity B. Her utility function is: U(C0, C1) = C0 + 2C1 + min(C0, C1) What is the highest price that Jill is willing to pay? (4 marks) Contact: otto. [email  protected] utoronto. ca Midterm 2011 – Q3 Part D – Jill earns an income of $250 today and $250 next period but has no access to any production opportunities.She can, however spend some money today to purchase investment opportunity B. Her utility function is: U(C0, C1) = C0 + 2C1 + min(C0, C1) What is the highest price that Jill is willing to pay? (4 marks) †¢ With a perfect capital market, the Fisher Separation Theorem applies †¢ So the maximum amount she will pay is $434. 03 (i. e. NPVB) Contact: otto. [email  protected] utoronto. ca FINANCIAL MARKETS AND NET PRESENT VALUE (TO SUCCEED – PRACTICE, PRACTICE, PRACTICE) Week 3 – Quick Review (Self-Evaluation) of Week 2 â€Å"GET TO KNOW YOU† SURVEY (Name: Optional)Question #1: †¢ What has occurred in your other courses that you were happy about and would like to be incorporated int o this course ? †¢ What has occurred in your other courses that you were NOT happy about? Question #2: †¢ Anything specific you would like to learn? What are your learning goals in this course? †¢ Any specific requests from the instructor, TAs, program, other support staff, etc? Question #3: †¢ Are you thinking of pursuing further education in Finance, if not then what do you have in mind? And/or†¦ What job(s) are you interested in? Question #4: †¢ Tell me more about yourself (e. . goals, program concentration, 2nd or 3rd year, etc†¦ ) Question #5: †¢ Any other comments, requests, suggestions, etc? TAKE ~3 MINUTES INDIVIDUALLY TO FILL OUT SURVEY TAKE ~ 5 MINUTES TO TALK TO 5 CLASSMATES WHOM YOU HAVEN’T MET YET (write down initials) SURVEY RESULTS (SUMMARY) †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ Real world experiences, practical (real-world) examples, cases†¦ Relevant news (where to find news), Current issues in the market Relate course material to real world Exam tips/techniques Applications and excel models used in the real world Interactive class, games, videos†¦Extended office hours (availability) to address questions Humour Practice questions and solutions; Past exams and solutions Capital markets (high-level overview) Typical jobs in finance, Leading finance organizations Additional tutorial time Stock picking, portfolio allocation/analysis, investment tools/strategies, trading tips Learning topics that can be applied in real life Relate designations/roles to course material and applications Better understanding of financial instruments (e. g. Mortgages, bonds, etc†¦ ) View of finance from other functional areas (e. g. Marketing) http://www. explorefinancialservices. om/Options http://www. explorefinancialservices. com/ Financial Markets: What is Going On? Firms (Users of Capital) Initial Public Off ering (IPO) Secondary Offerings (SEO) Borrowing (Loans, Bonds) Dividends, $ Repurchases, Interest Payments $ Market Mechanisms or Market Makers (Stock Exchanges, Banks, Investment Funds, †¦) $ $ Firms Issue Stock Certificates and Bonds $ $$$ Invested in Stocks and Bonds Investors (Providers of Capital) Investment Banks help firms make transactions Brokers/Dealers help investors make transactions Reference: Alex MacKay 113 Hedge Fund Strategies Dedicated ShortSource: AIMA Canada Further Reading Hedge Funds – Emerging Market Strategy †¢ Emerging Markets (American Depository Receipts – ADRs vs. Foreign Securities) http://www. sec. gov/pdf/ininvest. pdf (Page 12) (SAP) Hedge Fund – Quants †¢ Jim Simons (Renaissance Technologies) – Commodities/Futures – (Rapid Fire Trading) – (computer and system specialists, researchers and traders) (computational linguists–speech recognition/investing) †¢ http://chinese-school. netfir ms. com/abacus-hedge-funds-Jim-Simons. html †¢ †¢ Kenneth Griffin (Citadel Investment Group) – Convertible Bonds –> Long-Short †¢ http://money. cnn. om/2008/12/08/news/companies/citadel_vickers. boyd. fortune/index. htm The Quants (Scott Patterson – Wall Street Journal Reporter) †¢ †¢ http://www. businessweek. com/magazine/content/10_09/b4168070829612. htm http://online. wsj. com/article/SB10001424052748704509704575019032416477138. html Steven Palmer (AlphaNorth Asset Management Inc) (Microcap – Tech) †¢ http://www. theglobeandmail. com/globe-investor/funds-and-etfs/funds/top-hedge-fund-manager-turns-to-techmicro-caps/article1884049/ House Dems propose taxing equity trades to fund new federal programs †¢ †¢ †¢ Financial transaction tax on all stock (0. 5%), bond (0. %) and derivatives (0. 005%) trades Protects financial markets from speculation Make high-frequency trading â€Å"unprofitable† http://thehi ll. com/blogs/floor-action/house/249893-house-dems-propose-taxing-equity-trades-to-fund-new-federal-programs Harsh HFT curbs could sneak into MiFID †¢ †¢ †¢ †¢ Introduction of minimum resting times between trades Could force HFT firms out of the market, widening spreads and making trading more costly Meetings held with the European Parliament’s Economic and Monetary Affairs Committee (ECON) MiFID (Markets in Financial Instruments Directive) – European Union Law http://www. hetradenews. com/news/Regions/Europe/Harsh_HFT_curbs_could_sneak_into_MiFID_II. aspx CAPITAL MARKET THEORY RSM 332 – Week 2 Week 1 – Introduction – Financial Accounting (Review) Week 2 – Financial Markets and Net Present Value Week 3 – Present Value Concepts Week 4 – Bond Valuation and Term Structure Theory Week 5 – Valuation of Stocks Week 6 – Risk and Return – Problem Set #1 Due Week 7* – Midterm (Tuesday*) We ek 8 – Portfolio Theory Week 9 – Capital Asset Pricing Model Week 10 – Arbitrage Pricing Theory Week 11 – Operation and Efficiency of Capital Markets Week 12 – Course Review – Problem Set #2 DueContact: otto. [email  protected] utoronto. ca THANK YOU SEE YOU NEXT WEEK! OFFICE HOURS WEDNESDAYS – 4:00PM-6:00PM ROOM 413 OR 417 105 ST. GEORGE STREET ROTMAN (NORTH BUILDING)