Traditional Marketing Perspective

Question: Which point of view do you concur with? Why? Answer: Out of both the points of view, I for one concur with the customary advertising viewpoint of items being the reason for monetary trade and administrations being the optional advantage which is related with the unmistakable items. The entire reason for the financial trade is the trading of fiscal assets to fulfill specific needs or necessities (Vissa, 2012). The people engaged with the trade procedure, start the buy dynamic procedure dependent on their necessities and prerequisites. This thus drives them to locate the potential venders present in the relating market alongside the potential options of the comparing item. The third stage in the purchasing dynamic procedure recommends that the purchaser gauges all the potential choices present in the relating market as far as their capacities of fulfilling their necessities or prerequisites (Shore, 2006). This proposes the significant target of the money related exchange is the fulfillment of the necessities through the use of the materi alistic item. The fourth phase of the purchasing dynamic procedure permits the purchaser to dissect the choice of picking the item over the other options and getting it. Therefore the whole procedure of settling on the purchasing choice of the purchaser depends on the fulfillment of their needs. After the acquisition of the items, the associations offer different types of assistance to the clients to keep up their fulfillment of the item. Thus the items are the reason for the financial trade and the administrations are the optional advantages related with them to upgrade their use understanding (Mitchell, 2012). References Mitchell, J. R., Mitchell, R. K., Mitchell, B. T., Alvarez, S. (2012). OPPORTUNITY CREATION, UNDERLYING CONDITIONS AND ECONOMIC EXCHANGE. Shore, L. M., Tetrick, L. E., Lynch, P., Barksdale, K. (2006). Social and financial trade: Construct advancement and approval. Diary of Applied Social Psychology, 36(4), 837-867. Vissa, B. (2012). Office in real life: Entrepreneurs' organizing style and inception of monetary trade. Association Science, 23(2), 492-510.

Master a Seasonal Essay, the Holiday Way

Ace a Seasonal Essay, the Holiday Way Ace a Seasonal Essay, the Holiday Way Edit as You Go When composing anything, it is imperative to check fill in as you go. Numerous authors don't check for mistakes until the finish of a paper; this can be tricky. Its much less exertion to check for blunders as you compose. Having a second pair of eyes is constantly valuable; proficient composing administrations can check your work and assist you with making enhancements. Be Sensible On the off chance that you intend to make your composing â€Å"visual,† you should be elucidating. Except if youre adding pictures to the content, the peruser can just experience an article through your words. Prior to composing, take in the location of a vacation welcoming card, or write in a merry setting. Fuse insights about how the occasion smells, feels, tastes, and looks. Utilize an assortment of faculties to pass on your pictures and importance. Know Your Audience Similarly as organizations do statistical surveying, an author should know his/her crowd. What perusing level is the crowd? What’s their land area? Remember the crowd as you compose. On the off chance that It Sounds Right, Write! Perusing your exposition resoundingly all through the procedure. In spite of the fact that an expression might be linguistically right, the stating could be ungainly. Unbalanced expressing is diverting to the peruser, particularly in an exposition endeavoring to pass on the soul or vitality of the Christmas season. Prepare to stun the world, and Add a Touch of You It very well may be anything but difficult to get disheartened when composing; a great many people do. Take a stab at permitting yourself to â€Å"dream big† with regards to your article. Drive yourself to compose 1000 words, and afterward push past that. Brainstorm innovative themes, and make it you by including an individual touch. Is it accurate to say that you are clever? Include humor. Is it true that you are tragic? Discussion about how individuals get blue during the special seasons. Your emotions and considerations make the paper more grounded. Each voice is extraordinary and significant. Continue dealing with your composition, and look for the assistance of an expert composing administration when you hit a hindrance. Call cost free all through Canada at 1-800-573-0840.

The Seasons of Campus

The Seasons of Campus The University of Illinois has one of the best campuses for a diverse weather schedule. Spring, summer, fall, and even winter will bring you an experience that encompasses every type of weather situation. Every type of weather has its ups and downs, but the campus is what makes the weather so special. Winter is a time of wearing boots and taking beautiful pictures of the trees with snow dangling off of them. On the other hand, spring is a time of doing homework on the Quad and playing a little frisbee. Illinois is home to beautiful summers, as well. If you happen to be on campus over the summer, youll find that Illinois is a place for moderate days and cool nights. The Quad is one of the best places to be over the summer, too, because of the peaceful nature of most students being gone for the summer. Matter of fact, one could say that the weather is a great reason to stay on campus over the summer for classes. Fall is wonderful in its own right, as well. Illinois football on Saturday afternoons is amazing and will truly make you feel the team spirit. There is also a really cool RSO called October Lovers that celebrates everything that the fall has to offer. I would say that most students on campus would agree that fall is the most active time for activities on campus. I have to say that I love spring the most on campus. It is a time when your school year is clearly coming together, and all the trees are so pleasant on the eyes as they bloom and show another year of awakening. Its just too bad that this beauty is accompanied by homework and the eventual finals week. Jacob Class of 2019 I’m an Advertising student within the College of Media. My hometown is a place called Fairmount, Illinois, which is about 30 minutes from campus. I began my Illinois journey in the Division of General Studies.

Parenthood Is A Typical Illustration Of Developmental...

Parenthood Daniel Baleho The movie parenthood is a typical illustration of developmental psychology in early childhood, middle childhood as well as adulthood. Ecological system and the role of subsystems, socioeconomical status and parenting style is clearly portrayed in it the Buckman family in it. Gil Buckman is a 35 year-old father of three. He works as executive in sales while his wife; Karen stays at home and cares for their children. Their children names are: Kevin, Justin and daughter Taylor. Kevin is the eldest son, while Justin is the youngest. Gil tries to make balance between his career and family. He was not happy about his Kevin because Kevil looks insecure and unconfident. As a result his father thinks he was the reason for his son`s failure. He struggles to avoid being the type of father his father Frank was .old man, On the other hand, Karen, tries to remain calm and supportive. Helen, Gil`s oldest sister is divorced and raising her two children as single parent Her daughter Julie is not obe dient to her, she is more interested in her boyfriend and does not care about her education. Gary seems quite. Susan, Gil`s another sister teaches in middle school and she is married to a scientist named Nathan Huffner. Nathan gives their daughter education for her psychological development (cognitive), but Susan is not happy about his controlling nature. Larry, Gil`s youngest brother arrives home after a longtime of disappearance. Frank, TheShow MoreRelatedU07A1 Compare and Contrast Two Family Therapy Theories Essay3707 Words   |  15 PagesTherapy Theories Choose two family systems therapy theories that you are interested in learning more about and applying to the family subsystem you analyzed in the Unit 5 assignment. Write a paper in which you describe the central concepts, goals, and typical interventions of each model, using scholarly sources (journal articles, books, or edited book chapters) to support your writing. Your paper must use a minimum of three scholarly, peer-reviewed sources for each model. Once you have described the mainRead MoreCurrent Issues and Trends in Assessment in Early Childhood Education6428 Words   |  26 Pagesin Early Childhood Education. 1). A reevaluation of the view that early childhood education is a panacea 2). Greater emphasis on planned continuity between kindergartens and the primary grades 3). Increased use of multi-age grouping 4). Need for parenthood education in the high school 5). Importance of parent involvement in the decision making and policy formation processes concerning the education of his child and the implementation of classroom programs 6). Wider acceptance of the

The Influence of Women in Epic of Gilgamesh Essay - 580 Words

The Influence of Women in Epic of Gilgamesh Gilgamesh can be viewed as a writing that describes the social scene of the times it was written in. The characters of Enkidu and Gilgamesh are strong males. The roles of women in Gilgamesh are submissive and subtle. Women in this ancient Sumerian tale tend to be passive, but capable of influencing the outcome of events. Enkidu is a mighty force to confront. He is so strong that he is seen as a wild animal in his first appearances in the book. Gilgamesh is as strong or even stronger than Enkidu. He is the king of Uruk and is part god and part man. These dominant male characters command the most attention of the reader. The prostitute is one of the roles of women in the text. She brought†¦show more content†¦She walks behind Enkidu when he enters the great market at Uruk. She is subtle in her intentions. Enkidu has obviously been deceived into leaving his home in the wilderness. King Gilgamesh is a daunting figure who demands total obedience. This is documented in Hartley Spatts review. Spatt states, When the audience next learns that the king has been abusive to the young men of the city and has deflowered young maidens, their disapproval of these acts is tempered by their initial approval of his great accomplishment (2538). He goes on to say, The tales content reveals much about humanitys earliest social and religious concerns... (Spatt 2538). It certainly does reveal elements of these issues. No matter where the leader of a city or country exists today, the public would not tolerate such behavior. Gilgameshs acts further demonstrate the social environment at the time of writing. Women had no rights and their families accepted this as the norm. The book records the creation of Enkidu: So the goddess conceived an image in her mind, and it was of the stuff of Anu of the firmament. She dipped her hands in water and pinched off clay, she let it fall in the wilderness, and noble Enkidu was created (Gilgamesh 19). 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Explain why the NEP was unpopular with many Communists Free Essays

Many Communists were devoted to fulfilling Mar’s Communist Manifesto and were upset by the NAP going against it. These were mainly the far leftists who openly protested against it as the farer right members saw that keeping the NAP for a longer time would help the revolution by being a â€Å"half way house† between Communism and Capitalism. Many Communists found it difficult to speak out against Lenin as he was almost God like amongst them and he saw the NAP as a short term solution. We will write a custom essay sample on Explain why the NEP was unpopular with many Communists or any similar topic only for you Order Now Not only did the private ownership of business just upset Communists because it went against their ideology, it also meant that people who profited from their private businesses would be earning more than others which would lead to class divisions in society. The Communists wanted to break down all class barriers so that everyone would be equal. Not only this, class divisions could lead to political divisions, jeopardizing the Communist rule. Political divisions can’t happen in a Communist state. It just can’t happen. The class divisions will be even more pronounced as unemployment is very high meaning living standards are dropping for some. Firstly, there shouldn’t be any unemployment in a Communist state because everyone is meant to have a place in society that is equal to everyone else. Secondly, dropping living standards turned people against the Communists. You’re not going to support a government when you’re worse off under them than you were before. Many Communists blame the NAP for the peasants’ resentment of the overspent; although it probably was more to do with the fact the Communists were forcing a revolution to happen in a country that wasn’t ready. Privately owned businesses in many cases were doing better than state owned ones which reflected badly on the government. They were doing better because they would benefit personally from their own hard work and so had more motivation to work well whereas workers in the State businesses didn’t have that incentive. Also, state owned businesses were struggling to each full productivity because of outdated machinery which resulted in high production costs of consumer goods and so prices were high. This was terrible for the economy and led to peasants withholding food or purposely growing less as it profited them more as they could sell it for more. This angered Communists as they were trying to increase grain production for their industrialization plans. The NAP was not producing the capital the state required to industrialist. Even though they owned all the heavy production nines, they were losing out on the money made by the privately owned businesses plus the money from the peasants agriculture (which is going to pay for the industrialization of the LESSER) is going down thanks to them growing less or withholding more food! The NAP simply didn’t meet the needs of the USSR and the Communists said the USSR needed industrialist’s. So even though the NAP encouraged initiative amongst peasants and they loved being able to sell their grain on open markets, the Communists didn’t see this as enough of a gain and so opposed the NAP. How to cite Explain why the NEP was unpopular with many Communists, Papers

Israels Economy Essays - Eastern Mediterranean, Israel, Republics

Israel's Economy Israel's economy stands on natural resources. Copper and salt can be found there. Also, natural chemicals like potash and phosphates come from the Dead Sea area. Israel is one of the top producers rubber, plastics and chemicals. Also, clay and sand come naturally to Israel. Scientists have proven that Israel can grow fruits and vegetables in its hot and dry deserts. That gives them a bigger amount of plants to sell and help their economy. Citrus fruits and vegetables help a great deal to Israel's economy no matter where they're grown. Israel's economy needs a little help but their natural resources do quite a bit for them. Israel depends on trading with other countries and manufacturing goods in order to have the things they need. Israel's main trading partners are England, America, Germany, Italy and France. In fact, one third of the country's exports go to The US. Clothing and other household goods are manufactured in Israel but are mostly not traded because the country is unable to make enough of an abundance. The clothing industry employs over 46,000 workers in Israel. Israel is also the top exporter of cut and polished diamonds. Products for the military have to be manufactured because of their political state. The only vehicles manufactured in Israel go to their armed forces, forcing them to import all of their cars. Israel produces electronics like laser equipment, image processing devices and fiber optic materials. Israel trades great amounts and manufactures great amounts. All of this gives them a better economy. Israel has huge amounts of tourism. More than 2,000,000 tourists visit the country every year. Tourism is one of Israel's most profitable industries. People travel to Israel because of their religion, to visit family or for just sight seeing. In 1986, 929631 tourists traveled to the country by air. All of those tourists earned Israeli airlines a total of over 210 million dollars all in one year. Recently, tourism has declined but still, 20 percent of Israel's visitors each year come from the United States. The number of tourists helps the economy because there are many sights.

Star Appliance Company Essays

Star Appliance Company Essays Star Appliance Company Essay Star Appliance Company Essay This paper will discuss how Star Appliance Company managed its cost of capital and plan for future investments. The paper will reveal corporate problems and present relevant management theories to lead the company into a solution. The underlying problems consist of choosing a new and more efficient financing strategy, and designing more accurate method of evaluating investment projects. Previously, the company was having positive sales performances which indirectly cause the problem to be hard to identify. However, as the company needed to expand their business, the new financial officer discovered several inefficiencies in managing corporate financing strategies and evaluating future investment. The condition was described by the WACC method.   The paper will present alternatives of solutions for the problem and in the end choose the most beneficial one for the case. The company must adopt a new financing strategy which incorporates a balanced proportion between debt and equity financing instruments. The company must also design a new evaluation strategy for the new investment projects which incorporate risks premiums, additional cost of investments and a margin of error in forecasting future cash flow. The financial department has obtained increasing roles in the corporate management concept. In previous times, marketing department projects sales, production department determined the necessary amount of assets required in order to meet the projections, and the financial department’s function was only to provide funds for providing other department with their requirements. However, this model of management is obsolete and replaced by more coordinated types of decision making, where financial managers are responsible for planning as well as controlling activities. This reflects the increasing importance of good financial considerations in each decision of the corporation. According to Weston and Brigham (1996), there are several detailed activities related to financial management. One of them is the activity of making investment and financing decisions. In line with corporate long term strategy, financial managers must provide funds to support growth. Successful companies usually have high rate of sales, which required additional factory investment, equipment and current assets to produce goods and services. In the more coordinated decision making activities, financial managers must help determining the optimum sales level and make decisions on specific investment that will be performed. Within those activities, there are also questions of whether to use internal or external financing, debt or equity financing, and short or long term debts. These are important aspects of corporate management that could determine whether the company is heading to success or financial failure. Within this paper, I am discussing the importance of considering cost of assets in corporate financial management. The case study will be the Star Appliance Company in 1977. In this paper, I will describe the problems within Star Appliance Company financial management and offer recommendation to solve existing problems within the company. II.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Problems Within the Star Company II.1  Ã‚  Ã‚  Ã‚  Ã‚   Corporate Background The Star Appliance Company is a successful business of manufacturing home appliances, especially electric stoves and ovens. Soon after the company was established in 1922, it receives a warm welcome from the growing market for home appliances. The company focuses on providing its customers with premium types of home appliances with a slightly higher margin than its competitors. In a short time, the company managed to gather significant market share due to its reputation of providing high quality appliances. Corporate financial strategy –to use equities instead of debts- has seemed to be working splendidly as The Company was able to survive the great depression and maintain its existence with smaller-based operations but strong financial structure within the company. However, management has become aware that there are problems in maintaining profitable operations with existing lines. The company plans to enrich its product lines, but there are some concerns regarding how the company managed its cost of capital. Without strong financial management capabilities, investments in new product lines could destroy corporate profitability instead of developing it. Therefore, these problems must be addressed first. II.2  Ã‚  Ã‚  Ã‚  Ã‚   Hurdle Rates In simple understanding, hurdle rate means the minimum acceptable rate of return on a capital investment project. It is required to measure the limitation of when an investment is no longer considered profitable. The calculation has the basic logic of requiring returns to be higher than the cost of investment. However it also incorporate several factors such as the cost of risk, inflation, etc. It is a comprehensive look on how an investment will increase the wealth of the shareholders. Mathematically, the hurdle rate consists of the cost of the capital plus the project’s risk premium (‘The Hurdle Rate, 2006). II.2.1  Ã‚   Corporate Hurdle Rates The company seemed lacked logical reasoning to determine its hurdle rate. Corporate hurdle rate is based only by an experience on previous return of equity. According to the elaboration above, this policy is vulnerable to risks and provides low assurance for profit. The company must determine a new and more reasonable hurdle rate by incorporating factors such as cost of capital and risk premium (‘The Hurdle Rate’, 2006) II.2.2  Ã‚   Cost of Capital The cost of capital must be included within an investment calculation simply because we do not want to invest where we it provides us with no profit what so ever. Nevertheless, because obtaining money results additional costs, the concept cost of capital must include two things: the project cost and the financing cost. To be acceptable, a project must have a rate of return that exceeds the project cost plus the financing cost (‘The Hurdle Rate’, 2006) II.2.3  Ã‚   Risk Premium Nevertheless, cost of capital itself still does not provide a logical measurement toward a good financing decision. This is because every return from different sets of investment has a different degree of assurance. If the investment has less than 100% assurance for the return, then a risk premium must be included in the calculation of financing decision. However, the rate of risk premium must be set very in a very careful manner. Inadequate amount of risk premium will put our investment if jeopardy, on the other hand, over assuming the amount of risk premium will eliminate some profitable projects from consideration (‘The Hurdle Rate, 2006). II.3  Ã‚  Ã‚  Ã‚  Ã‚   Financing Alternatives and Inflation II.3.1  Ã‚   Corporate Financing Strategy As mentioned in the case study, the company ha a unique strategy of financing. The company depends on equity financing methods a lot more than debt financing methods. On other words, the company survived through its years mostly by selling corporate equities. According to the case study, this is possible because the company has a remarkable reputation as a premium producer of household appliances and able to maintain good relationship with its affiliates. Nevertheless, Arthur Foster, the financial president of the company seemed confuse about corporate unwillingness to use debt instruments. Debt instruments have a considerably lower cost than equity, especially after incorporating tax into the calculation. The company might want to reconsider its policies of financing instruments. Furthermore, he argues that a proper additional margin must also be incorporated into the calculation to offset the effect of inflation. II.3.2  Ã‚   Debt and Equity Instruments The company prefers the equity financing because it has lower cost and smaller legal risk. However, due to corporate policy of increasing dividend rate, the alternative is no longer providing more efficiency compare to debt instruments. Generally, debt instruments will result a slightly higher capital cost and they would require monthly payment, nevertheless, they do not have the risk of loosing corporate control to shareholders. Moreover, if the company is able to maintain the good credibility toward creditors, after some time they would be more than happy to facilitate the company with debt extensions. On the other hand, the equity instruments are a tool of obtaining additional funds through affiliates or partners. These means management will loose more of the corporate control as the equity instruments build sups inside the company. Generally, the best option is to keep the proper balance between debt and equity financing instruments. Because the good balance differs among industry, the Star Appliance Company must put some effort in finding its own financing balance (‘Financing’, 2006). II.3.3  Ã‚   Inflation As stated by many economists in the late 1970’s, inflation was a significant factor influencing the cost of capital. A study by Cohen (1997) however, revealed that until today, inflation is still a significant influence for cost of capital. Inflation, even at its low rates, increases the user cost of capital significantly. If the rate of inflation decreases, the marginal gain in investment is greater compare to the rate of the decrease. This reflects the stronger effect of inflation toward cost of capital. Therefore, inflation should be incorporated in every investment analysis. II.4.  Ã‚  Ã‚  Ã‚   Risk, Legal Fees and margin of Error The last of Foster’s concerns is about how the company accounts for investment risks that are significantly larger than the others. There are opinions that riskier information should be evaluated using higher hurdle rates. Furthermore, Foster believed that there should be a margin to account for the existence of legal fees such as safety, and environmental costs. This margin is required to prevent the additional costs to eat away corporate profit from the investment. Finally, the investments must also calculate a margin of error, in order to account for unexpected disturbance in the forecasting process. In case of using different hurdle rates for different projects, management theories favor the opposite. According to several management theories, investment and financing consideration has different factors that must not be brought together. Investment decisions are based on the consideration of which project are the most profitable, while financing decisions should focus on supporting investment decision and not altering it. III.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Star Company Cost of Equity Cost of Equity is measured by various indicators. However, one of the most utilized is the Weighted Average Cost of Capital ratio. A firm’s WACC is the overall required return on the firm as a whole. In simple terms, the ratio accounts for every possibility of financing a corporation. According to the WACC concept, a corporation can either be financed by debt, preferen stock or common stock. The WACC put all of these factors into equation that resulted the average interest the company must pay for every dollar it finances. The calculation is as follows: WACC = w1k1(1-T) + w2k2 + w3k3 W1   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of debt K1  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = the rate of interest W2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of preferen stock K2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of preferen stock W3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common equity K3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of common equity (Weston Brigham, 1996) According to existing data, the company financed most of its investments using retained earnings. The company did not have any long-term debt, which means that the w1 and k1 equals to 0. The case study also reveals that the company did not have any preferred stock within corporate balances sheet, which mean that the w2 and k2 equals to 0. Thus, the only variable exist within Star Appliance Company’s WACC is the common stock variable. Without the presence of debt and preferred stock, If we calculate the number of dividend paid and divide the result with total common stock of the company, then we will obtain a very high number of WACC. nbsp; Calculation : WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common stock * (dividend paid/ total value of common stock) WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(dividend/share * total shares common stock)/total value of common stock] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(1.52 * 13,414,268)/ 27,835,000] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 73% nbsp; The number means that on the period that ended December 31, 1978, the company paid as much as 73% for equity financing instruments. This is due to corporate operation to increase the rate of dividend paid, in order to satisfy shareholders. Despite corporate ability to sustain corporate operations and investment activities, the number is extremely high. Observing corporate financial structure, the company could easily obtain additional funding from debt instruments. Debts would have a much lower capital cost compare to the ‘sky-reaching’ dividend rate. nbsp; IV.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Recommendation From the case study, we are able to capture two main problems of the Star Appliance Company. The first point is the problem of choosing from alternatives financing instrument. Arthur Foster believed that despite the acceptable state of corporate financial performance at the time, the company could be a lot more efficient by altering its financing strategy. The second issue is that of choosing between different methods of evaluating alternative investments. There are several alternatives of solution forth both problems. nbsp; IV.1   Ã‚  Ã‚   Choosing Financing Instruments The first choice is to maintain corporate policy of using retained earnings and equity instruments in financing. This alternative will not create a problem for the company in the short-run. However, in the long-run, the company would need to expand its business by performing investment activities that require large amount of funds. This condition has been described in the case study as the company is trying to finance three projects with existing resource. In order to move forward with this project, the company needs to increase the efficiency of its financial structure. Maintaining current financing strategy will deny the company from further profitable investments using the projects. The second choice is to use debt instruments to cover the needs for investment. This alternative could provide the company with large amount of funds, considering the company did not yet have a balance of long-term debt. However, debt instruments are known for its slightly higher cost compare to standard equity instrument’s cost. It also requires a monthly payment that could be a burden if occurred in large proportions. Furthermore, companies overburdened with debts generally less favored by shareholders and future investors. The third alternative is to maintain a balance between debt and equity financing. This can be achieved by observing the debt-to-equity ratio and maintaining it within the proper balance. Some companies believe that a good company would not have a debt-to-equity ratio of more than 3 to 1. However, a good balance for debt-to-equity financing differs within each industry and the company must benchmark to other sin the industry to find the right balance. nbsp; IV.2  Ã‚  Ã‚   Methods of Choosing Investment Projects Within this issue, foster emphasizes several important points: methods of determining the proper hurdle rate, incorporating inflation, incorporating legal cost and a margin of error. The first alternative is to remain practicing existing investment evaluation method: using 10% hurdle rate, with little consideration of inflation cost, legal cost and a margin of error. This method will result all three projects to be acceptable alternatives. The company might be able to successfully financed all three projects if it apply for further external financing instruments, however,   the level of accuracy within the calculation will be low and there will be no certainty of the real cash flow that will be received in following years. The second alternative would be to incorporate financing costs, risk premium, inflation, legal cost and a margin of error. There is no sufficient data to perform these types of calculation within this paper. However, it can be estimated that the second alternative will not be acceptable according to the new hurdle rate and the new evaluation standard. The third alternative is to incorporate financing costs, risk premium, inflation, legal cost, margin of error and additional margin for riskier investments that require additional asset. This alternative will present a more accurate calculation of existing projects, but it will influence investment decisions with consideration of financing, something that will reduce investment activities considerably. nbsp; V.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Solution In choosing financing alternatives, the best solution for Star Appliance Company is to start using considerable debt instrument. The target is to balance the proportion between debt and equity. The company should have no difficulties in obtaining additional funds from debt instruments because of its good reputation and zero balance of long term debt. The balanced proportion between debt and equity instruments will lead to efficient financial management and resulted optimum capacity for further investment activities. In designing methods of evaluating investment projects, the company should choose to incorporate inflation, legal fees and margin of error, but should not choose to make additional margins for relatively riskier projects. Each project should be calculated using similar percentage of hurdle rate plus additional costs mentioned previously. nbsp; VI.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Conclusion Unlike most companies, the company seemed to have no problem in marketing and selling its premium product. However, the premium profits caused management to neglect efficiency concerns in managing its operations and investment decisions. The problem became visible as the company appointed new financial officer and tried to plan for further investment. Despite previous success, company’s WACC displayed that corporate cost of capital is significantly higher than average. The new financial officer mentioned problems such as the lack consideration of inflation, legal fees and margin of error in evaluating new projects. These factors are important in providing managers with accurate investment decisions and accurate predictions of cash flow. For example, according to a study by Cohen (1997) inflation has a significant effect in cost of capital. Furthermore, not incorporating legal fees and margin of error will eat away the profit of the investment. The solution presented for the company is to redesign its financing strategy into a balanced proportion between debt and equity. In terms of evaluating investment activities, the company should incorporate additional fees and a margin of error.

Star Appliance Company Essays

Star Appliance Company Essays Star Appliance Company Essay Star Appliance Company Essay This paper will discuss how Star Appliance Company managed its cost of capital and plan for future investments. The paper will reveal corporate problems and present relevant management theories to lead the company into a solution. The underlying problems consist of choosing a new and more efficient financing strategy, and designing more accurate method of evaluating investment projects. Previously, the company was having positive sales performances which indirectly cause the problem to be hard to identify. However, as the company needed to expand their business, the new financial officer discovered several inefficiencies in managing corporate financing strategies and evaluating future investment. The condition was described by the WACC method.   The paper will present alternatives of solutions for the problem and in the end choose the most beneficial one for the case. The company must adopt a new financing strategy which incorporates a balanced proportion between debt and equity financing instruments. The company must also design a new evaluation strategy for the new investment projects which incorporate risks premiums, additional cost of investments and a margin of error in forecasting future cash flow. The financial department has obtained increasing roles in the corporate management concept. In previous times, marketing department projects sales, production department determined the necessary amount of assets required in order to meet the projections, and the financial department’s function was only to provide funds for providing other department with their requirements. However, this model of management is obsolete and replaced by more coordinated types of decision making, where financial managers are responsible for planning as well as controlling activities. This reflects the increasing importance of good financial considerations in each decision of the corporation. According to Weston and Brigham (1996), there are several detailed activities related to financial management. One of them is the activity of making investment and financing decisions. In line with corporate long term strategy, financial managers must provide funds to support growth. Successful companies usually have high rate of sales, which required additional factory investment, equipment and current assets to produce goods and services. In the more coordinated decision making activities, financial managers must help determining the optimum sales level and make decisions on specific investment that will be performed. Within those activities, there are also questions of whether to use internal or external financing, debt or equity financing, and short or long term debts. These are important aspects of corporate management that could determine whether the company is heading to success or financial failure. Within this paper, I am discussing the importance of considering cost of assets in corporate financial management. The case study will be the Star Appliance Company in 1977. In this paper, I will describe the problems within Star Appliance Company financial management and offer recommendation to solve existing problems within the company. II.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Problems Within the Star Company II.1  Ã‚  Ã‚  Ã‚  Ã‚   Corporate Background The Star Appliance Company is a successful business of manufacturing home appliances, especially electric stoves and ovens. Soon after the company was established in 1922, it receives a warm welcome from the growing market for home appliances. The company focuses on providing its customers with premium types of home appliances with a slightly higher margin than its competitors. In a short time, the company managed to gather significant market share due to its reputation of providing high quality appliances. Corporate financial strategy –to use equities instead of debts- has seemed to be working splendidly as The Company was able to survive the great depression and maintain its existence with smaller-based operations but strong financial structure within the company. However, management has become aware that there are problems in maintaining profitable operations with existing lines. The company plans to enrich its product lines, but there are some concerns regarding how the company managed its cost of capital. Without strong financial management capabilities, investments in new product lines could destroy corporate profitability instead of developing it. Therefore, these problems must be addressed first. II.2  Ã‚  Ã‚  Ã‚  Ã‚   Hurdle Rates In simple understanding, hurdle rate means the minimum acceptable rate of return on a capital investment project. It is required to measure the limitation of when an investment is no longer considered profitable. The calculation has the basic logic of requiring returns to be higher than the cost of investment. However it also incorporate several factors such as the cost of risk, inflation, etc. It is a comprehensive look on how an investment will increase the wealth of the shareholders. Mathematically, the hurdle rate consists of the cost of the capital plus the project’s risk premium (‘The Hurdle Rate, 2006). II.2.1  Ã‚   Corporate Hurdle Rates The company seemed lacked logical reasoning to determine its hurdle rate. Corporate hurdle rate is based only by an experience on previous return of equity. According to the elaboration above, this policy is vulnerable to risks and provides low assurance for profit. The company must determine a new and more reasonable hurdle rate by incorporating factors such as cost of capital and risk premium (‘The Hurdle Rate’, 2006) II.2.2  Ã‚   Cost of Capital The cost of capital must be included within an investment calculation simply because we do not want to invest where we it provides us with no profit what so ever. Nevertheless, because obtaining money results additional costs, the concept cost of capital must include two things: the project cost and the financing cost. To be acceptable, a project must have a rate of return that exceeds the project cost plus the financing cost (‘The Hurdle Rate’, 2006) II.2.3  Ã‚   Risk Premium Nevertheless, cost of capital itself still does not provide a logical measurement toward a good financing decision. This is because every return from different sets of investment has a different degree of assurance. If the investment has less than 100% assurance for the return, then a risk premium must be included in the calculation of financing decision. However, the rate of risk premium must be set very in a very careful manner. Inadequate amount of risk premium will put our investment if jeopardy, on the other hand, over assuming the amount of risk premium will eliminate some profitable projects from consideration (‘The Hurdle Rate, 2006). II.3  Ã‚  Ã‚  Ã‚  Ã‚   Financing Alternatives and Inflation II.3.1  Ã‚   Corporate Financing Strategy As mentioned in the case study, the company ha a unique strategy of financing. The company depends on equity financing methods a lot more than debt financing methods. On other words, the company survived through its years mostly by selling corporate equities. According to the case study, this is possible because the company has a remarkable reputation as a premium producer of household appliances and able to maintain good relationship with its affiliates. Nevertheless, Arthur Foster, the financial president of the company seemed confuse about corporate unwillingness to use debt instruments. Debt instruments have a considerably lower cost than equity, especially after incorporating tax into the calculation. The company might want to reconsider its policies of financing instruments. Furthermore, he argues that a proper additional margin must also be incorporated into the calculation to offset the effect of inflation. II.3.2  Ã‚   Debt and Equity Instruments The company prefers the equity financing because it has lower cost and smaller legal risk. However, due to corporate policy of increasing dividend rate, the alternative is no longer providing more efficiency compare to debt instruments. Generally, debt instruments will result a slightly higher capital cost and they would require monthly payment, nevertheless, they do not have the risk of loosing corporate control to shareholders. Moreover, if the company is able to maintain the good credibility toward creditors, after some time they would be more than happy to facilitate the company with debt extensions. On the other hand, the equity instruments are a tool of obtaining additional funds through affiliates or partners. These means management will loose more of the corporate control as the equity instruments build sups inside the company. Generally, the best option is to keep the proper balance between debt and equity financing instruments. Because the good balance differs among industry, the Star Appliance Company must put some effort in finding its own financing balance (‘Financing’, 2006). II.3.3  Ã‚   Inflation As stated by many economists in the late 1970’s, inflation was a significant factor influencing the cost of capital. A study by Cohen (1997) however, revealed that until today, inflation is still a significant influence for cost of capital. Inflation, even at its low rates, increases the user cost of capital significantly. If the rate of inflation decreases, the marginal gain in investment is greater compare to the rate of the decrease. This reflects the stronger effect of inflation toward cost of capital. Therefore, inflation should be incorporated in every investment analysis. II.4.  Ã‚  Ã‚  Ã‚   Risk, Legal Fees and margin of Error The last of Foster’s concerns is about how the company accounts for investment risks that are significantly larger than the others. There are opinions that riskier information should be evaluated using higher hurdle rates. Furthermore, Foster believed that there should be a margin to account for the existence of legal fees such as safety, and environmental costs. This margin is required to prevent the additional costs to eat away corporate profit from the investment. Finally, the investments must also calculate a margin of error, in order to account for unexpected disturbance in the forecasting process. In case of using different hurdle rates for different projects, management theories favor the opposite. According to several management theories, investment and financing consideration has different factors that must not be brought together. Investment decisions are based on the consideration of which project are the most profitable, while financing decisions should focus on supporting investment decision and not altering it. III.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Star Company Cost of Equity Cost of Equity is measured by various indicators. However, one of the most utilized is the Weighted Average Cost of Capital ratio. A firm’s WACC is the overall required return on the firm as a whole. In simple terms, the ratio accounts for every possibility of financing a corporation. According to the WACC concept, a corporation can either be financed by debt, preferen stock or common stock. The WACC put all of these factors into equation that resulted the average interest the company must pay for every dollar it finances. The calculation is as follows: WACC = w1k1(1-T) + w2k2 + w3k3 W1   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of debt K1  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = the rate of interest W2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of preferen stock K2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of preferen stock W3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common equity K3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of common equity (Weston Brigham, 1996) According to existing data, the company financed most of its investments using retained earnings. The company did not have any long-term debt, which means that the w1 and k1 equals to 0. The case study also reveals that the company did not have any preferred stock within corporate balances sheet, which mean that the w2 and k2 equals to 0. Thus, the only variable exist within Star Appliance Company’s WACC is the common stock variable. Without the presence of debt and preferred stock, If we calculate the number of dividend paid and divide the result with total common stock of the company, then we will obtain a very high number of WACC. nbsp; Calculation : WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common stock * (dividend paid/ total value of common stock) WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(dividend/share * total shares common stock)/total value of common stock] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(1.52 * 13,414,268)/ 27,835,000] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 73% nbsp; The number means that on the period that ended December 31, 1978, the company paid as much as 73% for equity financing instruments. This is due to corporate operation to increase the rate of dividend paid, in order to satisfy shareholders. Despite corporate ability to sustain corporate operations and investment activities, the number is extremely high. Observing corporate financial structure, the company could easily obtain additional funding from debt instruments. Debts would have a much lower capital cost compare to the ‘sky-reaching’ dividend rate. nbsp; IV.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Recommendation From the case study, we are able to capture two main problems of the Star Appliance Company. The first point is the problem of choosing from alternatives financing instrument. Arthur Foster believed that despite the acceptable state of corporate financial performance at the time, the company could be a lot more efficient by altering its financing strategy. The second issue is that of choosing between different methods of evaluating alternative investments. There are several alternatives of solution forth both problems. nbsp; IV.1   Ã‚  Ã‚   Choosing Financing Instruments The first choice is to maintain corporate policy of using retained earnings and equity instruments in financing. This alternative will not create a problem for the company in the short-run. However, in the long-run, the company would need to expand its business by performing investment activities that require large amount of funds. This condition has been described in the case study as the company is trying to finance three projects with existing resource. In order to move forward with this project, the company needs to increase the efficiency of its financial structure. Maintaining current financing strategy will deny the company from further profitable investments using the projects. The second choice is to use debt instruments to cover the needs for investment. This alternative could provide the company with large amount of funds, considering the company did not yet have a balance of long-term debt. However, debt instruments are known for its slightly higher cost compare to standard equity instrument’s cost. It also requires a monthly payment that could be a burden if occurred in large proportions. Furthermore, companies overburdened with debts generally less favored by shareholders and future investors. The third alternative is to maintain a balance between debt and equity financing. This can be achieved by observing the debt-to-equity ratio and maintaining it within the proper balance. Some companies believe that a good company would not have a debt-to-equity ratio of more than 3 to 1. However, a good balance for debt-to-equity financing differs within each industry and the company must benchmark to other sin the industry to find the right balance. nbsp; IV.2  Ã‚  Ã‚   Methods of Choosing Investment Projects Within this issue, foster emphasizes several important points: methods of determining the proper hurdle rate, incorporating inflation, incorporating legal cost and a margin of error. The first alternative is to remain practicing existing investment evaluation method: using 10% hurdle rate, with little consideration of inflation cost, legal cost and a margin of error. This method will result all three projects to be acceptable alternatives. The company might be able to successfully financed all three projects if it apply for further external financing instruments, however,   the level of accuracy within the calculation will be low and there will be no certainty of the real cash flow that will be received in following years. The second alternative would be to incorporate financing costs, risk premium, inflation, legal cost and a margin of error. There is no sufficient data to perform these types of calculation within this paper. However, it can be estimated that the second alternative will not be acceptable according to the new hurdle rate and the new evaluation standard. The third alternative is to incorporate financing costs, risk premium, inflation, legal cost, margin of error and additional margin for riskier investments that require additional asset. This alternative will present a more accurate calculation of existing projects, but it will influence investment decisions with consideration of financing, something that will reduce investment activities considerably. nbsp; V.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Solution In choosing financing alternatives, the best solution for Star Appliance Company is to start using considerable debt instrument. The target is to balance the proportion between debt and equity. The company should have no difficulties in obtaining additional funds from debt instruments because of its good reputation and zero balance of long term debt. The balanced proportion between debt and equity instruments will lead to efficient financial management and resulted optimum capacity for further investment activities. In designing methods of evaluating investment projects, the company should choose to incorporate inflation, legal fees and margin of error, but should not choose to make additional margins for relatively riskier projects. Each project should be calculated using similar percentage of hurdle rate plus additional costs mentioned previously. nbsp; VI.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Conclusion Unlike most companies, the company seemed to have no problem in marketing and selling its premium product. However, the premium profits caused management to neglect efficiency concerns in managing its operations and investment decisions. The problem became visible as the company appointed new financial officer and tried to plan for further investment. Despite previous success, company’s WACC displayed that corporate cost of capital is significantly higher than average. The new financial officer mentioned problems such as the lack consideration of inflation, legal fees and margin of error in evaluating new projects. These factors are important in providing managers with accurate investment decisions and accurate predictions of cash flow. For example, according to a study by Cohen (1997) inflation has a significant effect in cost of capital. Furthermore, not incorporating legal fees and margin of error will eat away the profit of the investment. The solution presented for the company is to redesign its financing strategy into a balanced proportion between debt and equity. In terms of evaluating investment activities, the company should incorporate additional fees and a margin of error.

Star Appliance Company Essays

Star Appliance Company Essays Star Appliance Company Essay Star Appliance Company Essay This paper will discuss how Star Appliance Company managed its cost of capital and plan for future investments. The paper will reveal corporate problems and present relevant management theories to lead the company into a solution. The underlying problems consist of choosing a new and more efficient financing strategy, and designing more accurate method of evaluating investment projects. Previously, the company was having positive sales performances which indirectly cause the problem to be hard to identify. However, as the company needed to expand their business, the new financial officer discovered several inefficiencies in managing corporate financing strategies and evaluating future investment. The condition was described by the WACC method.   The paper will present alternatives of solutions for the problem and in the end choose the most beneficial one for the case. The company must adopt a new financing strategy which incorporates a balanced proportion between debt and equity financing instruments. The company must also design a new evaluation strategy for the new investment projects which incorporate risks premiums, additional cost of investments and a margin of error in forecasting future cash flow. The financial department has obtained increasing roles in the corporate management concept. In previous times, marketing department projects sales, production department determined the necessary amount of assets required in order to meet the projections, and the financial department’s function was only to provide funds for providing other department with their requirements. However, this model of management is obsolete and replaced by more coordinated types of decision making, where financial managers are responsible for planning as well as controlling activities. This reflects the increasing importance of good financial considerations in each decision of the corporation. According to Weston and Brigham (1996), there are several detailed activities related to financial management. One of them is the activity of making investment and financing decisions. In line with corporate long term strategy, financial managers must provide funds to support growth. Successful companies usually have high rate of sales, which required additional factory investment, equipment and current assets to produce goods and services. In the more coordinated decision making activities, financial managers must help determining the optimum sales level and make decisions on specific investment that will be performed. Within those activities, there are also questions of whether to use internal or external financing, debt or equity financing, and short or long term debts. These are important aspects of corporate management that could determine whether the company is heading to success or financial failure. Within this paper, I am discussing the importance of considering cost of assets in corporate financial management. The case study will be the Star Appliance Company in 1977. In this paper, I will describe the problems within Star Appliance Company financial management and offer recommendation to solve existing problems within the company. II.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Problems Within the Star Company II.1  Ã‚  Ã‚  Ã‚  Ã‚   Corporate Background The Star Appliance Company is a successful business of manufacturing home appliances, especially electric stoves and ovens. Soon after the company was established in 1922, it receives a warm welcome from the growing market for home appliances. The company focuses on providing its customers with premium types of home appliances with a slightly higher margin than its competitors. In a short time, the company managed to gather significant market share due to its reputation of providing high quality appliances. Corporate financial strategy –to use equities instead of debts- has seemed to be working splendidly as The Company was able to survive the great depression and maintain its existence with smaller-based operations but strong financial structure within the company. However, management has become aware that there are problems in maintaining profitable operations with existing lines. The company plans to enrich its product lines, but there are some concerns regarding how the company managed its cost of capital. Without strong financial management capabilities, investments in new product lines could destroy corporate profitability instead of developing it. Therefore, these problems must be addressed first. II.2  Ã‚  Ã‚  Ã‚  Ã‚   Hurdle Rates In simple understanding, hurdle rate means the minimum acceptable rate of return on a capital investment project. It is required to measure the limitation of when an investment is no longer considered profitable. The calculation has the basic logic of requiring returns to be higher than the cost of investment. However it also incorporate several factors such as the cost of risk, inflation, etc. It is a comprehensive look on how an investment will increase the wealth of the shareholders. Mathematically, the hurdle rate consists of the cost of the capital plus the project’s risk premium (‘The Hurdle Rate, 2006). II.2.1  Ã‚   Corporate Hurdle Rates The company seemed lacked logical reasoning to determine its hurdle rate. Corporate hurdle rate is based only by an experience on previous return of equity. According to the elaboration above, this policy is vulnerable to risks and provides low assurance for profit. The company must determine a new and more reasonable hurdle rate by incorporating factors such as cost of capital and risk premium (‘The Hurdle Rate’, 2006) II.2.2  Ã‚   Cost of Capital The cost of capital must be included within an investment calculation simply because we do not want to invest where we it provides us with no profit what so ever. Nevertheless, because obtaining money results additional costs, the concept cost of capital must include two things: the project cost and the financing cost. To be acceptable, a project must have a rate of return that exceeds the project cost plus the financing cost (‘The Hurdle Rate’, 2006) II.2.3  Ã‚   Risk Premium Nevertheless, cost of capital itself still does not provide a logical measurement toward a good financing decision. This is because every return from different sets of investment has a different degree of assurance. If the investment has less than 100% assurance for the return, then a risk premium must be included in the calculation of financing decision. However, the rate of risk premium must be set very in a very careful manner. Inadequate amount of risk premium will put our investment if jeopardy, on the other hand, over assuming the amount of risk premium will eliminate some profitable projects from consideration (‘The Hurdle Rate, 2006). II.3  Ã‚  Ã‚  Ã‚  Ã‚   Financing Alternatives and Inflation II.3.1  Ã‚   Corporate Financing Strategy As mentioned in the case study, the company ha a unique strategy of financing. The company depends on equity financing methods a lot more than debt financing methods. On other words, the company survived through its years mostly by selling corporate equities. According to the case study, this is possible because the company has a remarkable reputation as a premium producer of household appliances and able to maintain good relationship with its affiliates. Nevertheless, Arthur Foster, the financial president of the company seemed confuse about corporate unwillingness to use debt instruments. Debt instruments have a considerably lower cost than equity, especially after incorporating tax into the calculation. The company might want to reconsider its policies of financing instruments. Furthermore, he argues that a proper additional margin must also be incorporated into the calculation to offset the effect of inflation. II.3.2  Ã‚   Debt and Equity Instruments The company prefers the equity financing because it has lower cost and smaller legal risk. However, due to corporate policy of increasing dividend rate, the alternative is no longer providing more efficiency compare to debt instruments. Generally, debt instruments will result a slightly higher capital cost and they would require monthly payment, nevertheless, they do not have the risk of loosing corporate control to shareholders. Moreover, if the company is able to maintain the good credibility toward creditors, after some time they would be more than happy to facilitate the company with debt extensions. On the other hand, the equity instruments are a tool of obtaining additional funds through affiliates or partners. These means management will loose more of the corporate control as the equity instruments build sups inside the company. Generally, the best option is to keep the proper balance between debt and equity financing instruments. Because the good balance differs among industry, the Star Appliance Company must put some effort in finding its own financing balance (‘Financing’, 2006). II.3.3  Ã‚   Inflation As stated by many economists in the late 1970’s, inflation was a significant factor influencing the cost of capital. A study by Cohen (1997) however, revealed that until today, inflation is still a significant influence for cost of capital. Inflation, even at its low rates, increases the user cost of capital significantly. If the rate of inflation decreases, the marginal gain in investment is greater compare to the rate of the decrease. This reflects the stronger effect of inflation toward cost of capital. Therefore, inflation should be incorporated in every investment analysis. II.4.  Ã‚  Ã‚  Ã‚   Risk, Legal Fees and margin of Error The last of Foster’s concerns is about how the company accounts for investment risks that are significantly larger than the others. There are opinions that riskier information should be evaluated using higher hurdle rates. Furthermore, Foster believed that there should be a margin to account for the existence of legal fees such as safety, and environmental costs. This margin is required to prevent the additional costs to eat away corporate profit from the investment. Finally, the investments must also calculate a margin of error, in order to account for unexpected disturbance in the forecasting process. In case of using different hurdle rates for different projects, management theories favor the opposite. According to several management theories, investment and financing consideration has different factors that must not be brought together. Investment decisions are based on the consideration of which project are the most profitable, while financing decisions should focus on supporting investment decision and not altering it. III.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Star Company Cost of Equity Cost of Equity is measured by various indicators. However, one of the most utilized is the Weighted Average Cost of Capital ratio. A firm’s WACC is the overall required return on the firm as a whole. In simple terms, the ratio accounts for every possibility of financing a corporation. According to the WACC concept, a corporation can either be financed by debt, preferen stock or common stock. The WACC put all of these factors into equation that resulted the average interest the company must pay for every dollar it finances. The calculation is as follows: WACC = w1k1(1-T) + w2k2 + w3k3 W1   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of debt K1  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = the rate of interest W2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of preferen stock K2  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of preferen stock W3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common equity K3  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = cost of common equity (Weston Brigham, 1996) According to existing data, the company financed most of its investments using retained earnings. The company did not have any long-term debt, which means that the w1 and k1 equals to 0. The case study also reveals that the company did not have any preferred stock within corporate balances sheet, which mean that the w2 and k2 equals to 0. Thus, the only variable exist within Star Appliance Company’s WACC is the common stock variable. Without the presence of debt and preferred stock, If we calculate the number of dividend paid and divide the result with total common stock of the company, then we will obtain a very high number of WACC. nbsp; Calculation : WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = percentage of common stock * (dividend paid/ total value of common stock) WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(dividend/share * total shares common stock)/total value of common stock] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 100% * [(1.52 * 13,414,268)/ 27,835,000] WACC (1978)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 73% nbsp; The number means that on the period that ended December 31, 1978, the company paid as much as 73% for equity financing instruments. This is due to corporate operation to increase the rate of dividend paid, in order to satisfy shareholders. Despite corporate ability to sustain corporate operations and investment activities, the number is extremely high. Observing corporate financial structure, the company could easily obtain additional funding from debt instruments. Debts would have a much lower capital cost compare to the ‘sky-reaching’ dividend rate. nbsp; IV.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Recommendation From the case study, we are able to capture two main problems of the Star Appliance Company. The first point is the problem of choosing from alternatives financing instrument. Arthur Foster believed that despite the acceptable state of corporate financial performance at the time, the company could be a lot more efficient by altering its financing strategy. The second issue is that of choosing between different methods of evaluating alternative investments. There are several alternatives of solution forth both problems. nbsp; IV.1   Ã‚  Ã‚   Choosing Financing Instruments The first choice is to maintain corporate policy of using retained earnings and equity instruments in financing. This alternative will not create a problem for the company in the short-run. However, in the long-run, the company would need to expand its business by performing investment activities that require large amount of funds. This condition has been described in the case study as the company is trying to finance three projects with existing resource. In order to move forward with this project, the company needs to increase the efficiency of its financial structure. Maintaining current financing strategy will deny the company from further profitable investments using the projects. The second choice is to use debt instruments to cover the needs for investment. This alternative could provide the company with large amount of funds, considering the company did not yet have a balance of long-term debt. However, debt instruments are known for its slightly higher cost compare to standard equity instrument’s cost. It also requires a monthly payment that could be a burden if occurred in large proportions. Furthermore, companies overburdened with debts generally less favored by shareholders and future investors. The third alternative is to maintain a balance between debt and equity financing. This can be achieved by observing the debt-to-equity ratio and maintaining it within the proper balance. Some companies believe that a good company would not have a debt-to-equity ratio of more than 3 to 1. However, a good balance for debt-to-equity financing differs within each industry and the company must benchmark to other sin the industry to find the right balance. nbsp; IV.2  Ã‚  Ã‚   Methods of Choosing Investment Projects Within this issue, foster emphasizes several important points: methods of determining the proper hurdle rate, incorporating inflation, incorporating legal cost and a margin of error. The first alternative is to remain practicing existing investment evaluation method: using 10% hurdle rate, with little consideration of inflation cost, legal cost and a margin of error. This method will result all three projects to be acceptable alternatives. The company might be able to successfully financed all three projects if it apply for further external financing instruments, however,   the level of accuracy within the calculation will be low and there will be no certainty of the real cash flow that will be received in following years. The second alternative would be to incorporate financing costs, risk premium, inflation, legal cost and a margin of error. There is no sufficient data to perform these types of calculation within this paper. However, it can be estimated that the second alternative will not be acceptable according to the new hurdle rate and the new evaluation standard. The third alternative is to incorporate financing costs, risk premium, inflation, legal cost, margin of error and additional margin for riskier investments that require additional asset. This alternative will present a more accurate calculation of existing projects, but it will influence investment decisions with consideration of financing, something that will reduce investment activities considerably. nbsp; V.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Solution In choosing financing alternatives, the best solution for Star Appliance Company is to start using considerable debt instrument. The target is to balance the proportion between debt and equity. The company should have no difficulties in obtaining additional funds from debt instruments because of its good reputation and zero balance of long term debt. The balanced proportion between debt and equity instruments will lead to efficient financial management and resulted optimum capacity for further investment activities. In designing methods of evaluating investment projects, the company should choose to incorporate inflation, legal fees and margin of error, but should not choose to make additional margins for relatively riskier projects. Each project should be calculated using similar percentage of hurdle rate plus additional costs mentioned previously. nbsp; VI.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Conclusion Unlike most companies, the company seemed to have no problem in marketing and selling its premium product. However, the premium profits caused management to neglect efficiency concerns in managing its operations and investment decisions. The problem became visible as the company appointed new financial officer and tried to plan for further investment. Despite previous success, company’s WACC displayed that corporate cost of capital is significantly higher than average. The new financial officer mentioned problems such as the lack consideration of inflation, legal fees and margin of error in evaluating new projects. These factors are important in providing managers with accurate investment decisions and accurate predictions of cash flow. For example, according to a study by Cohen (1997) inflation has a significant effect in cost of capital. Furthermore, not incorporating legal fees and margin of error will eat away the profit of the investment. The solution presented for the company is to redesign its financing strategy into a balanced proportion between debt and equity. In terms of evaluating investment activities, the company should incorporate additional fees and a margin of error.

Exercises in Identifying Adverb Clauses

Exercises in Identifying Adverb Clauses An adverb clause (also known as an adverbial clause) is a dependent clause used as an adverb within a sentence. These types of clauses can modify the whole sentence, as well as verbs, adverbs, and adjectives, and may show aspects such as time, reason, concession, or condition. These clauses may often start with words such as while, if, because, when, although, unless, since, so that, whereas, even if, in case, as long as, and other words. In contrast, an adjectival clause will modify a noun and start with a relative pronoun (that, who, whose, whom, or which) or a subordinate conjunction (when  and  where). Before doing these exercises, you may find it helpful to review the study sheet Building Sentences With Adverb Clauses. Practice Identifying Adverb Clauses Each of these  proverbial sayings contains an adverb clause. Identify the adverb clause in each sentence, and then compare your answers with those below. While the cats away, the mice will play.A lie travels around the world while truth is putting her boots on.If you dont know where you are going, any road will get you there.Memory is deceptive because it is colored by todays events.Never look down on anybody unless youre helping him up.You have to kiss a lot of toads before you find a handsome prince.Whenever you find yourself on the side of the majority, it is time to pause and reflect.Life is what happens when you are making other plans.As soon as you forbid something, you make it extraordinarily appealing.Everything is funny, as long as its happening to somebody else.Don’t count your chickens before they hatch.If you want something done right, you have to do it yourself. When the going gets tough, the tough get going. When in Rome, do as the Romans do. Cowards die many times before their death. Dont cross the bridge till you come to it. Dont put the cart before the horse. Answer Key In the following sentences, the adverb clauses are in  bold print. Examine what word or phrase theyre modifying and what aspect they show (time, reason, concession, or condition). For example, in sentence 1, the clause refers to the time that the mice will play. While the cats away, the mice will play.A lie travels around the world  while truth is putting her boots on.If you dont know where you are going, any road will get you there.Memory is deceptive  because it is colored by todays events.Never look down on anybody  unless youre helping him up.You have to kiss a lot of toads  before you find a handsome prince.Whenever you find yourself on the side of the majority, it is time to pause and reflect.Life is what happens  when you are making other plans.As soon as you forbid something, you make it extraordinarily appealing.Everything is funny,  as long as its happening to somebody else.Don’t count your chickens before they hatch. If you want something done right, you have to do it yourself. When the going gets tough, the tough get going. When in Rome, do as the Romans do. Cowards die many times before their death. Dont cross the bridge till you come to it. Dont put the cart before the horse.

Literature Review on Domestic Abuse From 5 different articles from Dissertation

Literature Review on Domestic Abuse From 5 different articles from Columbia College - Dissertation Example It has often been observed to lead towards permanent physical damages as well as disability of the victims. Children are also classified to be affected due to domestic violence acts which certainly influence their growth as well as social development in a healthy and prosperous way. Article 1 Annotated Bibliography Reference Citation Certain, H. E., Mueller, M., Jagodzinski, T., & Fleming, M. (2008). Domestic Abuse During the Previous Year in a Sample of Postpartum Women. JOGNN 37(1), pp. 35-41. What is the article about? The article relates to domestic abuse of postpartum women. Information about sample and population The sample size considered for the research in this article concentrated on one 1,519 women who were visiting for a postpartum appointment in clinics located in rural, urban as well as suburban locations. Stating precisely, women who were18 years of age and older, being seen for a postpartum visit at 35 obstetric and gynecologic clinics located in 15 Wisconsin counties of United States, were the participants of this study. . Article summary The article is related to the domestic abuse witnessed by postpartum women. The women who visited the clinic were examined through a routine screen to find out whether they have faced any emotional or physical abuse. Why was the research performed? The research was performed to identify the frequency of women being victimized to domestic abuse or violence within the research area. The study also intended to reveal the consequences led by the outcomes of domestic abuse like mental illness, physical damages as well as disability. Findings Following a cross-sectional survey, the study reveals that 112 women were suffering of domestic abuse which provided an alarming ratio of 1 in every 14 women as the victim. It was further revealed that domestic abuse results in poorer health as well as depression amid women. Strengths The article helps in understanding the consequences as well as identifies the elements linked up with domestic abuse. Weaknesses The findings of the article were observed to lack in terms of consistency as well as there was no typical profile of abused women during pregnancy. Implications for Practice The implications of the findings obtained in the study suggest that policies need to be formulated for better identification of domestic abuse. Literature Review According to Certain, Mueller, Jagodzinski and Fleming (2008), 112 women were reported to be a victim of abuse out of the total respondents, i.e. 1,519 women who required postpartum treatments. The study also revealed that abuse of women can result to chronic poor physical health issues, chronic mental illness as well as preterm labor along with low birth weight infants. The clinics providing prenatal as well as postpartum care are thus required to be aware as well as take special care of victims suffering from domestic violence. Postpartum depression has been considered with great significant in this article. The find ings of this study further suggest that depressions as well as mental stresses are also associated with domestic abuse, which further increases the severity of such conducts. The interconnection among domestic abuse as well as postpartum depression is less recognized. However, in few studies which were conducted found out the relation among the postpartum depression as well as domestic abuse. Hispanic ethnicity was considered to be associated with domestic abuse in this study. For instance, the study reveal

Program capstone IP5 Essay Example | Topics and Well Written Essays - 1000 words

Program capstone IP5 - Essay Example The introduction stage occurs after a product has been effectively been marketed and surveys carried out and as a result achieved its desired marketing goal. The product is then introduced into the market with an aim of creating immediate demand. At this stage, there is very little competition in the market and the sales volume of the product increases rapidly. The prices are very high as well as promotion methods leading to the firms registering high profits. The maturity phase of the product life cycle is marked by an increase in sales volume at a decreasing rate. At this stage, imitations of the product begin to emerge in the foreign markets causing the firm to begin lowering its exportation of the product. The manufacturers are forced to lower the market price of the product in order to maintain its market share as well as supporting its sales. Despite a decrease in the profit levels, the firm’s product still remains attractive due to high volumes available in the market. The saturation period is marked by stability in the product line. The sale volume is at its peak and there is no possibility of extending it further. Sales at this stage undergo stability initially but then begin to fall as many substitutes of the product enter the market. At this stage, the manufacturing firms must aim at developing new alternative uses of the product through effective differentiation which can be either vertical or horizontal (Chitale, 2013). In order to sustain the maturity period, firms will tend to introduce alterations as well as innovations to the product so as to keep the interest of the customers high so that they keep on buying the product. The phase can also be lengthened through variations in terms of prices due to the stiff competition in the market. Some of the popular and well known products such as the iPod together with the iPhone are currently in the maturity stage. Apple has however been very

Are Whistleblowers Heroes or Traitors?

Are Whistleblowers Heroes or Traitors? EDWARD SNOWDEN AND BRADLEY (CHELSEA) MANNING: HEROES OR TRAITORS? Author Note Introduction Paragraph First paragraph: Edward Snowden: Who is he and what has he done? Second paragraph: Edward Snowden: Issues in the law; Is he a hero or traitor? Third paragraph: Bradley (Chelsea) Manning: Who is he and what has he done? Fourth paragraph: Bradley (Chelsea) Manning: Issues in the law; Is he a hero or traitor? Conclusion Paragraph: Edward Snowden, Chelsea Manning, positive vs. natural law. ABSTRACT Edward Snowden and Bradley (Chelsea) Manning disclosures of secret National Security Agency (NSA) files raises an important question. Are Edward Snowden and Bradley (Chelsea) Manning heroes, or traitors? Ultimately, the author will show how Snowden revealed that the United States government had been mass surveilling the people of America without their permission or knowledge and how Manning revealed â€Å"The Cost of War† showing how United States is intervening in the Middle East (Abu Omar abduction, the Iraqi Civilian death toll, and the viral video collateral murder). Furthermore, the author will discuss how the United States Espionage act affects both Snowden and Manning in a way that makes it impossible to explain their reasoning for their actions. INTRODUCTION When is it just to break the law? Edward Snowden, Julian Assange and Chelsea Manning have faced this question head on. All three are known as whistleblowers. These whistleblowers have disclosed top secret Government intelligence documents to the public and have spareked a worldwide debate concerning the surrender of our privacy for security. Some say that these whistleblowers are traitors. Donald Trump, President of the United States says that whistleblowers like Snowden and Manning are traitors and implies that they should be executed. â€Å" Spies in the old days used to be executed†(Donald Trump). Others say that he is a â€Å"human rights hero (Amnesty International)†.This story is of particular interest as it raises the question of whether the reason behind breaking the law should help determine the outcome. The purpose of this article is to examine whether these whistleblowers made the right choice in deciding to leak top secret government information. Are these whistleblowers heroes for making the world aware of the grotesque acts that the United States government affiliated to both America and the rest of the world? In Paragraph I, the article will outline who Edward Snowden is, it will explain what information that he leaked and will mention. In Paragraph I part II, the article will define the legal issues that are brought up in respect to Snowden. In paragraph II, the article will outline who Manning is, it will explain the information that he leaked, and will mention the charges that were brought upon him. In Paragraph II part II it will define the legal issues that are brought up in respect to Manning. Lastly, in paragraph III the article will outline Assange and will explain how he is involved in the case. The article will also outline what Assange is charged under. In undertaking this analysis, this article suggest that Edward Snowden, Chelsea Manning, and Julian Assange are heros, not traitors and should be treated accordingly. However, the article suggests that despite having the best intentions, they should be punished under a lesser sentence. EDWARD SNOWDEN Snowden is a 33 year old former CIA and NSA contractor born in Elizabeth City, North Carolina. Snowden derived from a family of patriots. His father worked for the military for 30 years, his grandfather retired as an admiral, and his mother to this day works for the federal courts. Snowden decided that he wanted to join the government during the Iraq war. Snowden’s desire to join the army is evident when he said in an interview that his motive of joining the army was to free people from oppression. Snowden said, â€Å"This is the kind of thing that led me to the army. When they said, â€Å"We’re going to free oppressed people from a dictator,† I felt that I had an obligation to do my part to see that happen†(Snowden). Snowden began training for the special forces in 2004 but ultimately failed as he suffered a fatal injury during a training exercise. Snowden was then discharged from the military. Snowden, still wanting to fight for his country, began his tr aining for the CIA in 2006. Graduating at the top of his class, Snowden was deployed with diplomatic cover to Geneva to maintain the CIA’s security network. While undercover, Snowden discovered a program that made him start questioning NSA’s power. The NSA program was called â€Å"XKeyscore†. Snowden revealed in an interview that this program filtered information that the NSA collected on a daily base and see everything that a particular person was posting. In an interview with Norddeutscher Rundfunk, Snowden explained the immense reach of XKeyscore. Snowden said, â€Å"Let’s say I saw you once and I thought what you were doing was interesting or you just have access that’s interesting to me, let’s say you work at a major German corporation and I want access to that network, I can track your username on a website on a form somewhere, I can track your real name, I can track associations with your friends and I can build what’s called a fingerprint which is network activity unique to you which means anywhere you go in the world anywhere you try to sort of hide your online presence hide your identity, the NSA can find you and anyone who’s allowed to use this or who the NSA shares their software with can do the same thing. Shortly after working for the CIA, Snowden began working for Dell in Japan to upgrade the NSA’s computer systems and protect from Chinese hackers(Forbes). After working in Japan for a couple of years, Snowden began to work for a company named â€Å" Booz Allen Hamilton†(BAH), an American consulting firm with ties to the NSA. This is where Snowden uncovered the Grotesque spying of the American people. So, Snowden then gathered all the data he could about the illicit activities the government was performing and leaked it to The Guardian. Snowden leaked thousands of top secret files Including that government had secret court orders to collect all telephone records and that he the government has a secret software named PRISM. According to The Guardian, PRISM is a software that grants full access to a companys servers and can access private emails, telephone calls etc; The companies are obliged by law to hand over this information. After revealing himself in an interview wit h The Guardian, the United States has charged him with â€Å"theft of government property unauthorized communication of National Defense information, and willful Communication of Classified Communications Intelligence Information to an Unauthorized Person (Caselaw). After evading an extradition from Hong Kong, Snowden claimed asylum in Russia and is presently living there. EDWARD SNOWDEN: RIGHT AND WRONG, LEGAL, AND ILLEGAL In order to analyse whether Snowden is a hero or a traitor we first have to understand the legal issues that his case raises. This article is not arguing whether Snowden broke the law or not but rather raising the question of whether it was a justifiable use of breaking the law. Snowden revealed that the United States forced Verizon to hand over its phone data in a classified court order (The Guardian). The classified court is named United States Foreign Intelligence Surveillance Court and was not known to the public until Snowden leaked the court order. The government responded and said that they are within their right to do because of a provision in the U.S patriot act. The U.S Patriot Act, an act signed by Bush just a month the 9/11 attacks, states, â€Å"Director of the Federal Bureau of Investigation or a designee of the Director (whose rank shall be no lower than Assistant Special Agent in Charge) may make an application for an order requiring the production of any tangible things (including books, records, papers, documents, and other items) for an investigation to obtain foreign intelligence information not concerning a United States person or to protect against international terrorism or clandestine intelligence activities, provided that such investigation of a United States person is not conducted solely upon the basis of activities protected by the first amendment to the Constitution†. The act also has a provision, stating that their needs to be reasonable grounds to request for this information (LII).In this case, the government had not even considered or stated why this information is relevant and does not even mention why they need the information now. In a unanimous decision the Federal Court of Appeals states why the governments reasoning for obtaining this information is not allowed nor is it constitutionalThe court states, â€Å"[T]he government takes the position that the metadata collected — a vast amount of which does not contain directly ‘relevant’ information, as the government concedes — are nevertheless ‘relevant’ because they may allow the NSA, at some unknown time in the future, utilizing its ability to sift through the trove of irrelevant data it has collected up to that point, to identify information that is relevant. We agree with appellants that such an expansive concept of ‘relevance’ is unprecedented and unwarranted†(AMERICAN CIVIL LIBERTIES UNION V. NATIONAL SECURITY AGENCY). The U.S District Judge in his ruling described the NSA’s capabilities as â€Å"almost orwellian†.The NSA’s is violating the constitution by spying on it’s people. Without Snowden’s leak, the ACLU would have never been able to bring this to trial as we would have never knew of it. After the verdict, the government began to introduce. 20 bills all aimed at tackling surveillance in America including the most prominent one The U.S.A Freedom Act (Slate). This act prevents mass surveillance and puts an end to programs like PRISM. By bringing the governments illicit actions to light, Snowden has shown the people of America that the government is breaking the law and acting unconstitutionally and should be considered a patriot. However, despite acting in good intentions, the government is still trying to arrest him. Snowden has sparked debate worldwide. Some say that he is a patriot as he took on immense risk all for the good of the people while some say that he is a spy and should be executed (Donald Trump). Snowden explained in an interview with The Guardian that he’d be okay losing if he had a fair trial., â€Å" If I ended up in guantanamo, I can live with that†. This demonstrates his character, as he understands that he is fighting for the people, but if the people thing he is guilty then he deserves to go to prison. This is further demonstrated in an interview with NBC when Snowden revealed that he leaked the documents because of his love of his country and the people in it. (NBC). Instead, of thinking that Snowden committed an illegal act we should think he is a hero because he did the right thing. In Snowden’s own words, â€Å"We should always make a distinction that right and wrong, is a very different standard than legal and illegal. The law is no substitute for morality†. This is not the only time that there has been tension in the law in order for progression. Some examples are; Whether it was The abolition of slavery, and the increased rights of women. â€Å"Laws were broken because the laws were wrong. In Conclusion, the author suggests that he is a hero. The definition of a hero is someone who overcomes adversity often sacrificing their own personal concerns for the greater good. In this example, Snowden has put his country first. Snowden has risked his life and his freedom in order to inform the citizens of America about the U.S governments illegal activities and has still stayed true to the one thing that every American wants to uphold†¦ The Constitution. Often, hero’s have a code or moral principle that they want to protect. In this case, Snowden wants to uphold his code which is that the constitution should be upheld. Snowden even taken an oath to uphold something so precious to him. As every federal employee has to taken an Oath of Office. The Oath of Office is widely considered â€Å"The Cornerstone of America†(RYOC) and is essentially a vow to protect their country and uphold the constitution. The Oath states, â€Å"I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God†. Snowden protected the one thing he swore to protect. The NSA paints Snowden as a traitor, and says that he broke the oath he has taken by revealing the information but in reality he defended the constitution while the NSA was attacking by illegally spying on it’s people. CHELSEA MANNING Bradley Manning, know known as Chelsea Manning, is a United States Army soldier who served as an intelligence analyst. Manning had a troubled childhood says her sister, Casey. According to Casey, she took care of Manning when she 11 because both parents were alcoholics even to the extent of making her a bottle in the middle of the night(Washington Post).At a young age Manning was considered intelligent, winning top prize at local science fair and even in a state wide quiz bowl (Washington post). Manning became openly game in 2005 when he came back from Wales. When manning came back, Manning’s father reportedly spent weeks trying to convince her to join the military(Washington Post). Manning joined the military in 2007. According to BBC news, Manning’s friends said that she joined the military to pay for college but eventually Manning stated that she had joined in hopes to rid her desires for becoming a woman (BBC). In 2009, Manning was deployed to Iraq as an intelligence analyst. This is where she granted access to the classified information that she had leaked. Manning made contact with Julian Assange in 2009. She gave Assange almost 750,000 classified documents including the famous video Collateral Murder, where it shows the U.S military killing 12 civilians and killing the people who were trying to save the injured. The leaks also included 251,287 U.S diplomatic cables and 482,832 war logs. After leaking the information, she confided in a hacker named Adrian Lamo. Lamo later informed the Army and Manning was arrested in May of that same year. After Manning was arrested, he was charged with 22 offenses including the most serious charge Aiding the Enemy, which could have resulted in life in prison. Manning was sentenced 35 years in prison thus becoming the harshest sentence that a whistleblower has ever received. CHELSEA MANNING: THE COST OF WAR In order to analyze whether Manning is a hero or a traitor, we need to understand his criminal case and the arguments made. Then, like Edward Snowden said, â€Å"We should always make a distinction that right and wrong, is a very different standard than legal and illegal. The law is no substitute for morality†. This is true especially for Chelsea Manning as her case is a bit more drastic than Snowdens. Manning stole and released over 700,000 classified documents in order to show us â€Å"The Cost of war†. Manning has been charged with aiding the enemy for leaking this classified information to the media. The enemy is considered at this time to be Al Qaeda, and Al Qaeda of the Arabian Peninsula. Manning leaked names who’d had confidential discussions with US diplomats. He also released that the president of Yemen was lying to his own Congress about American drone strikes in his country (The Guardian). In his case, Manning pled to 10 offenses which would have landed him around 20 years in prison. However, the military insisted that he was charged with aiding the enemy and violating the espionage act which would have added a life sentence. Eugene Fidell, an expert in military justice at yale law school, said that even Khalid Sheik Mohammed, the suspected architect of the 9/11 attacks, had greater rights of appeal than Chelsea would. â€Å" If he’s convicted by a military commission in guantanamo, KSM will get a straight shot at the US Supreme Court, He said. â€Å"By contrast, if CAAF denies Manning a review as it does in most cases, he will be out in the cold†. This shows how cruel the U.S government is towards Manning. At the time manning was 22 years when released those documents. After being arrested, Manning was in solitary confinement and subjected to forced nudity during inspection (Huffington Post). This not only violated his eighth amendment right but also violated article 16 of the convention against torture. Juan Mendez, UN special rapporteur on torture, said that Mannings treatment while he was in prison cruel, inhuman, and degrading. Mendez said, â€Å" I conclude that the 11 months under conditions of solitary confinement(regardless of the name given to his regime by the prison authorities) constitutes at a minimum, cruel, inhuman and degrading treatment in violation of article 16 of the convention against torture. If the effects in regards to pain and suffering inflicted on Manning were more severe, they could constitute torture†(The Guardian). Manning had not been to trial and had been psychologically been beaten by the government. This not only violated his right to physical and psychological integrity, but violated his presumption of innocence. So, what info did Manning give to the public that would warrant such inhumane treatment? Manning released documents that exposed the detainment of innocent people of guantanamo Bay, he revealed â€Å"The cost of war† in both Iraq and Afghanistan, and he helped fuel pro- democratic movements in the Arab world. After releasing the documents about the war crimes committed in Iraq. Iraq then refused to grant criminal and civil immunity to US troops if their stay was prolonged, thus promptly causing Obama to withdraw them from Iraq saving many American and Iraqi lives. Some of the documents that Manning released were shocking videos showing the war crimes that the US committed. The video â€Å"Collateral Murder†, released by Wikileaks, shows the disregard for human life and shows various war crimes committed by the U.S government. The video shows a US apache attack helicopter killing 12 civilians including 2 Reuters reporters and wounding two children on the ground in Baghdad in. Then, after they gruesomely killed the civilians, they murdered the people trying to rescue the wounded. Finally, to add insult to injury, a tank ran over one of the bodies cutting the man in half (Youtube). Not only did they murder innocent people but they got away with it until Manning leaked the video. this video depicted 3 war crimes. Section 499 of the Army Field Manual states, â€Å"Every violation of the law of war is a war crime.† According to Article 85 of the First Protocol to the Geneva Conventions, it defines that killing civilians is a war crime. (Huffington Post). In this video, it is clearly seen that not only did they shoot civilians, but they taunted them after their death. One of the gunners in the apache helicopter said, â€Å"Look at them dead bastards†(Youtube). They showed zero remorse and even laughed about it. Then, to make matters worse, they violated article 17 of the First protocol. This states that the civilian population â€Å" shall be permitted, even on their own initiative to collect and care for the wounded.† The article then says, â€Å"No one shall be harmed†¦ for such humanitarian acts†. In the video collateral murder, it is clearly seen that the gunners killed the good samaritans while they were picking up bodies. Lastly, they violated another section of the army field manual when the jeep drove over the dead body. Section 27-10 of the Army Field manual states that â€Å"maltreatment of dead bodies is a war crime. Not only did they run over the body, but they even laughed ab out it when one of the gunners mentioned it. According to Huffington post, they said that Manning had gone to his chain of command and asked them to investigate the video and other videos but ultimately refused. They also mention that he was obliged to do so. The Huffington Post states, â€Å"Enshrined in the US Army Subject Schedule No. 27-1 is â€Å"the obligation to report all violations of the law of war.† At his guilty plea hearing, Manning explained that he had gone to his chain of command and asked them to investigate the â€Å"Collateral Murder† video and other â€Å"war porn,† but his superiors refused. â€Å"I was disturbed by the response to injured children,† Manning stated. He was also bothered by the soldiers depicted in the video who â€Å"seemed to not value human life by referring to [their targets] as ‘dead bastards’† Huffington Post Manning went through the proper chain of command in order to fix the problem but ultimately was told to forget about it. Since Manning was ordered not to reveal classified information that contains the war crimes, it should also be noted that it works vice versa. Therefore, Manning had and performed his legal duty to reveal the war crimes (Huffington Post). In order for Manning to be found guilty under the Espionage act, the prosecutors must prove beyond a reasonable doubt that he maliciously release those files to harm the United States. In court, Manning stated that he released the documents to spark debate about foreign policy in general as it applied to Iraq and Afghanistan. Mannings goal was to inform the public about what are government-the people we elect to govern us- are doing. In this case, they are violating the military guidelines and Geneva conventions. The government also broke the law when they presumed that he was guilty before his trial had begun. President Obama commented on Manning saying that he broke the law before he was tried. Obama said, â€Å" We are a nation of laws†¦ He broke the law† (The Guardian)!. Not only did Obama prounounce him guilty before his trial, but the Chairman of the Joint Chiefs of staff, General Martin Dempsey, also said that he broke the law â€Å"(Stars and Stripes). This poiso ned the well and violated Article 37 of the Uniform code of Military Justice by â€Å"Unlawfully Influencing Action of Court†(Truth out). Manning’s lawyer tried to bring Obama to testify in this case, stating that it should be clear why he was needed as he influenced the courts decision. He said, â€Å"The relevancy of these witnesses should be obvious. Each of these witnesses has provided statements that contradict those given by the OCA [Original Classification Authority] witnesses regarding the alleged damage caused by the unauthorized disclosures. Additionally, each of these witnesses is relevant in order to inquire into the issues of unlawful command influence and unlawful pretrial punishment in violation of Articles 13 and 37 of the UCMJ.†Ã¢â‚¬  Huffington Post In Conclusion, the author believes that despite the fact Manning broke the rules, the people have to recognize that the rules are very contradictory. Manning has a duty to report all war crimes and tried to report it to his superiors but ultimately they refused. Should his moral obligation end there? It is the authors belief that he put morality over legality and thus should be noted. His obligation is report war crimes and not listen to unlawful orders. By not reporting the crime is to follow an unlawful order and should be recognized. Does this mean that Manning should serve no time? The author believes that regardless of Mannings intent, he still acted recklessly by releasing the files and how he released them. However, the time he served before the trial should have been his sentence after all the cruelty he had received. By definition Manning is a hero as thought through adversity by challenging the United States government and sacrificed himself so that the people could know th e True Cost of War CONCLUSION In conclusion, the author believes that both Snowden and Manning are innocent. Both Snowden and Manning put themselves through adversity for the greater good. In Snowden’s case he had to leave his home and was on the run from the American government because he leaked information about the mass surveillance going on in America. Similarly, Manning received 35 years in prison, torture from his government because she released information pertaining to â€Å"The Cost of War. The Stare Decisis in this case would be the nuremberg trials of WWII. The Nuremberg trials brought up that even if something is legal that it does not make it moral. This is a case of positive vs. natural law. Natural law says that there is a morality in which law is to reflect and if it morality does not reflect the law then it considered unjust. Positive law states that what is legal is moral. Mostly positive law was used throughout the 20th century until the Nazi regime happened. REFERENCES S. (n.d.). Bradley Manning Prosecution Incurably Infected by Government Misconduct. 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Retrieved June 12, 2017, from http://www.huffingtonpost.com/marjorie-cohn/bradley-mannings-legal-du_b_3390416.html FindLaws United States Tenth Circuit case and opinions. (n.d.). Retrieved June 12, 2017, from http://caselaw.findlaw.com/us-10th-circuit/1719511.html Gallagher, R. (2013, October 29). U.S. Lawmakers Launch Assault on NSA Domestic Snooping. Retrieved June 12, 2017, from http://www.slate.com/blogs/future_tense/2013/10/29/sensenbrenner_and_leahy_s_usa_freedom_act_seeks_to_curb_nsa_domestic_spying.html Greenberg, A. (2013, December 20). An NSA Coworker Remembers The Real Edward Snowden: A Genius Among Geniuses Retrieved June 12, 2017, from https://www.forbes.com/sites/andygreenberg/2013/12/16/an-nsa-coworker-remembers-the-real-edward-snowden-a-genius-among-geniuses/#791efdd9784e L. (2016, November 14). Lybio. Retrieved June 12, 2017, from http://lybio.net/amnesty-international-edward-snowden-write-for-rights/people/ Nakashima, E. (n.d.). Bradley Manning is at the center of the WikiLeaks controversy. But who is he? Retrieved June 12, 2017, from https://www.washingtonpost.com/lifestyle/magazine/who-is-wikileaks-suspect-bradley-manning/2011/04/16/AFMwBmrF_print.html Pilkington, E. (2012, March 12). Bradley Mannings treatment was cruel and inhuman, UN torture chief rules. Retrieved June 12, 2017, from https://www.theguardian.com/world/2012/mar/12/bradley-manning-cruel-inhuman-treatment-un Pilkington, E. (2013, February 28). Manning plea statement: Americans had a right to know true cost of war Retrieved June 12, 2017, from https://www.theguardian.com/world/2013/feb/28/bradley-manning-trial-plea-statement N. (n.d.). Snowden-Interview: Transcript (Seite 3). Retrieved June 12, 2017, from http://www.ndr.de/nachrichten/netzwelt/snowden277_page-3.html Tate, J. (2013, August 14). Manning apologizes, says he hurt the United States by giving documents to WikiLeaks. 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