"Economics / Finance / Banking" Essays 71-139

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How Does Canada's Federal System Affect Economic Policy in the Recovery? Term Paper

… ¶ … Canada's Federal system affect economic policy in the recovery?

In answering this question, you might consider the following (though you should NOT treat them as a series of short answer questions):

What is the most important economic priority… [read more]

CSR in Saudi Arabian Banking Research Proposal

… Participation in CSR activities by banks in Saudi Arabia has been viewed to improve their corporate reputation and hence according this banks easy management of the business and good future prospects as it would be easier to attract new customers.… [read more]

Most Important Pieces of U.S. Banking Financial Sector Legislation Essay

… ¶ … U.S. Banking/Financial Sector Legislation in the Last 50 Years

The past half century has been a turbulent period in America's banking and financial sector history based on a need for news laws in an increasingly globalized marketplace. Although… [read more]

Economic Crisis Iceland 2008 Research Paper

… Economic crisis: Iceland 2008

Current state of the economy

In numerical data, the economy of Iceland is marked by the following:

A gross domestic product of $12.15 billion, making Iceland the 145th largest economy of the globe (out of 227 countries)

After positive GDP growth rates in 2007 and 2008, 2009 saw a contraction of the national output by 6.6 per cent

The income per capita is of $39,600, significantly higher than the $10,500 global average. Iceland is in fact the 20th largest country in terms of GDP per capita

Similar to the global trend, the large majority of the national output is generated by services, followed by industry and agriculture. Specifically, the services account for 70.8 per cent of the GDP; industry accounts for 24 per cent and agriculture contributes with 5.2 per cent to the gross domestic product

The Icelandic labor force is composed of 180,900 individuals, most of whom are employed in services (73 per cent), followed by industry (22.2 per cent) and agriculture (4.8 per cent)

The unemployment rate is of 8.2 per cent, having registered a significant increase since its 4.8 per cent value in 2008

The federal budget is composed of expenditures in the amount of $6.729 billion and revenues of $4.844 billion, revealing as such a $1.885 billion federal deficit

The public debt accounts for 107.6 per cent of the gross domestic product -- the ninth largest public debt in the world

The inflation rate of 12 per cent is one of the lowest at a global scale

The country's economic growth and stability remain sensitive to fishery activities, which constitute more than 40 per cent of the export income, 12 per cent of the gross domestic product and employ 7 per cent of the labor force (Central Intelligence Agency, 2010).

Today, the federal actions regarding the Icelandic economy remain focused on stabilizing the climate and increasing the trust in the state by both citizens as well as foreigners. A specific question which is currently being addressed refers to the adherence of Iceland to the European Union. In the immediate aftermath of the crisis, an idea was issued according to which the insular country would intensify its efforts of adhering to the European Union. This measure would also imply the adoption of the euro as the national currency and the hope was that of a better protection in the face of future economic crises.

Despite the higher level of protection, the adherence to the EU would have also implied higher levels of involvement from the European Community. One direct consequence would have been the loss of control over the revenues from fishery activities. Additionally, it was believed that the European Union would impose union wide measures of dealing with the crisis and that the necessity of complying with the respective measures might not materialize in the most positive result for Iceland. In this light of thoughts, the process by which the country would adhere to the EU and adopt the euro as its… [read more]

Economics A) I View the Current Unemployment Essay

… Economics

a) I view the current unemployment rate of 10% as being higher than the natural rate. Unemployment rose rapidly as the result of expectations of a slowdown and economic contraction, rather than as a return to equilibrium. Unemployment in the U.S. has held in a relatively stable range between 4-6% since the early 1990s (Google.com, 2010). The increase to 10% represents an outlier created by unusual economic conditions.

b) The Phillips curve has showed to hold in the short run, so in the short run the government could trade inflation for less unemployment. The current Fed policy is to hold down interest rates to stimulate growth. This will bring inflationary pressure on the economy, but it will also create jobs. If rates were increased now, heading off potential inflation, that would halt growth. Unemployment lags growth, however, so the government needs to make the inflation trade-off in order to reduce unemployment. The stimulus served its purpose. The deficit is less a problem of stimulus than of unfunded liabilities left over from the previous administration. Any further stimulus at this point, however, would be wasteful spending. The economy is beginning to grow again and will bring about employment gains. Further stimulus at this point would not likely lead to gains - at least not those that are worth the cost in deficit. The large deficit is a concern, but can be managed with strong economic growth and containment of key costs -- and these are defense, Medicare and Social Security, not one-time stimulus. Ongoing stimulus would represent another unfunded liability, which would be a strong negative for the country's debt situation. At present, however, the debt is manageable and given strong growth will remain so.

2. a) A global currency would essentially a basket of currencies. There would be inherent problems just in creating such a currency. Some of the world's emerging economies have currencies that are either unstable or are pegged to the dollar. As the recent troubles in the Eurozone indicate, such a currency would be difficult to sustain as stronger, more stable regimes would be forced to bail out weaker one. The political will and broad-based fiscal controls necessary to implement such a currency would be difficult to maintain. If there is a good rationale for such a proposal, it is that stability of global trade could be improved by switching to such a basket.

b) One positive consequence for such a move is that the U.S. would see less demand for the dollar,…… [read more]

Comparing Assessing the Impact of Political or Economic Globalization Between Two Countries Thesis

… ¶ … Political or Economic Globalization Between Two Countries: China and India

The following work is of the nature that focuses on comparison and assessment of the impact of political or economic globalization and specifically as related to two particular… [read more]

Banking Communication and Marketing Essay

… Banking Information Sources

Assessing the Reliability, Authority, and Respect of Various Sources of Information on Banking Communication and Marketing

The reliability of financial information in general has come under great scrutiny recently, for very practical reasons. When bonds with the highest possible ratings from some of the most reputable analysts in the country suddenly tank, it is not surprising that an examination is conducted as to how such analysis is conducted, and the sources of information used to make such determinations. Had the same skepticism been brought bear before the current financial crisis, its damaging effects could have been mitigated or even avoided altogether. This is why academic scholarship attempts to remain rooted in sources that are not simply trusted, but that are continually examined and verified as reliable. In financial fields, where replication is no guarantor of certainty, authority is determined largely through consensus, and an examination of the most trusted sources of information on banking reveals this.

When it comes to institutions that overtly and explicitly represent banks' interests through the dissemination of information and the networking of banking professionals, it can be difficult00impossible, in fact -- to find an organization whose funding does not point to the distinct possibility of a bias. This is certainly true of the American Bankers Association, the nation's largest professional organization in the banking industry, but this does not change the fact that it is one of the most respected sources of banking information and policy advice (Feig & Bruno-Britz 2007). Independent analysts have determined that since its inception in 1875 -- which also makes it the oldest professional banking institution in the United States -- the American Bankers Association has been uniquely poised to assess and affect policy (Feig & Bruno-Britz 2007).

Ordinarily, sheer influence is not necessarily or even likely a measure of authority or reliability. In the financial world, however, influence often creates reliability. That is, behaviors tend to reflect perceived realities and thus bring about those realities. As the largest, oldest, and most respected professional organization in the banking world, the influence that the American Bankers Association wields in the industry causes its information and determination to be immensely powerful (Feig & Bruno-Britz 2007). In the most cynical view one could say that ignoring or discounting the determinations and advice of the American Banker's Association was simply foolish because it is the same information and advice that everybody else is listening to -- that is, the information and organization are reliable because everyone agrees that they are.

It might be assumed, then, that the American Banker's Association monthly publication would be the most respected trade publication in the banking industry, but this honor undoubtedly belongs to the Economist. Though the newsmagazine unabashedly practices advocacy journalism tat promotes deregulation and free trade, the fact is they truly perform a service of journalism, investigating and reporting stories more in depth and more critically than many competitors (Langfit 2006). While many other similar magazines are veering away from the often yawn-inducing… [read more]

Recent Finance Institution and Bank Bailout Plan Thesis

… Bailout

As the subprime crisis began to unfold, banks and other financial institutions around the world began to feel the weight of "toxic assets" on their balance sheets. A few such institutions found themselves at the edge of insolvency, and… [read more]

Banking Crisis the Global Financial Crisis Began Essay

… Banking Crisis

The global financial crisis began as a banking crisis in the United States and spread quickly throughout the world. A crisis of this proportion does not gestate quickly or easily -- a large number of factors and substantial time are required to create this type of economic mess. Among the lead factors were deregulation of banking sectors around the world, interest rate policy at the Federal Reserve, and the rampant securitization of mortgage debt.

The banking crisis is, at its heart, a credit crisis. Banks no longer have the capability to lend as freely as they once did. As a result, firms and individuals have a more difficult time getting the credit they need for capital investments, operating lines of credit or mortgages. This results in a negative reinforcing cycle of economic contraction. Deregulation of banking sectors in the U.S., Europe and elsewhere allowed banks to hold much more risk, lend out more of their money and lend to riskier borrowers. When the housing bubble burst and mortgage defaults began to accelerate rapidly, this excessive risk resulted in bank failures and near failures.

Interest rate policy at the Federal Reserve was another key antecedent. The dot-com collapse in 2000 led the U.S. Federal Reserve to lower interest rates as a means of increasing the money supply. As a result, U.S. banks were flush with cash to invest. This, combined with lack of oversight, led to increased lending to subprime borrowers, and even competition to attract such borrowers. This increased the risk that banks held. Without the increase in money supply, deregulation alone could not have brought about such catastrophic consequences (Knowledge @ Wharton, 2009).

Lastly, the crisis was spread throughout the world by the securitization of mortgage debt. High-grade mortgages have been securitized for decades by Fannie Mae and Freddie Mac, but during the 2000s mortgage-backed securities became in vogue. These complex instruments were an attempt to diversify away the debt. Financial institutions and national governments around the world latched onto these securities, misled by claims of AAA debt ratings. When the high rate of default caused the value of these mortgage-backed securities to collapse, it created substantial liabilities at financial institutions worldwide, leading to a global banking crisis.

Compounding the situation, when U.S. financial institutions began to fail, all of the assets that they backed became of questionable value (or valueless). This was the primary impact on Australia's banking system. It was estimated that the Big Four were exposed to $412 million at Lehman Brothers, the U.S.-based investment bank that collapsed (Johnston, 2008). Only Westpac, with around $10 million in exposure to Lehman, was spared a heavy hit. These banks had exposure, however, to other U.S. financial institutions, including AIG and Bear Stearns.

Despite these exposures, the Australian banking system fared well, compared with banks in many countries. In October 2008 the World Economic…… [read more]

International Finance in Japan Thesis

… International Finance in Japan

This work will provide a detailed discussion of the various ways the recent financial crisis in the United States and the ongoing U.S. recession in theory and in practice is affecting Japan.

In a recent report… [read more]

Finance and Financial Management Research Proposal

… Finance

a) the projects net present value is a loss of £2,180,988. The IRR is -7%. The project does not pay back, since the viable lifespan of the project is six years. Therefore, the project as presently constituted is not… [read more]

Political and Economic Implications of International Debt Essay

… Political and Economic Imlications of International Debt

International debt can be seen as an element part of the international financial infrastructure. At its surface, one can consider it as a way by which governments add money to their budgets in… [read more]

Differences in Economic Slowdowns and Recessions Term Paper

… ¶ … Economic Slowdowns and Recessions

Macroeconomic concept defines recession as a decline in the GDP during two successive quarters which is a short period of depression. NBER's definition of recession is a situation that is marked by a massive… [read more]

History of Economic Thought Mercantilist School Term Paper

… History Of Economic Thought

Mercantilist School a) the mercantilist trend was focused on a simple thought: the wealth and status of a nation depends directly on the accumulation of bullion (gold, silver and other precious metals). This led to the… [read more]

Global Corporate Finance Term Paper

… Global Corporate Finance

With the breakdown of the Soviet Union and the apparition of new states on the world map, correlated with strong economic developments in countries formerly categorized as developing, new corporations from countries like Kazakhstan, Hungary, Vietnam or… [read more]

Islamic Finance Term Paper

… Islamic Finance

What is Islamic Finance?

The Sharia or 'Islamic Law' unlike conventional Western Banking prohibits making money from money, like charging interest known as Riba which is usury. The law stipulates that wealth must be 'generated' solely through valid… [read more]

E-Banking on the Banking Industry Term Paper

… ¶ … E-Banking on the Banking Industry

To understand the relationship that can develop between the Internet and banks, one has to first understand the nature of both these items. The first to be understood is the banks. So far… [read more]

Economic Globalization Term Paper

… Financial Systems, Economic Growth, And Economic Globalization

Globalization has had significant impacts on all economies of the world, with manifold effects. It affects their production of goods and services. It also affects the employment of labor and other inputs into… [read more]

Housing Market Economic Analysis Term Paper

… Housing Market Economic Analysis

To Americans, ownership of their own homes was an essential part of living, and it formed a part of their base - Community, security, accomplishments and family. Yet the nature of home ownership has now changed,… [read more]

Trade Issues in Economic Development Term Paper

… Trade Issues in Economic Development

This report attempts to present insights into trade issues as they relate to economic development, globalization and developing countries. Today, globalization and world trade are being spurred on by new advances in technology, finance and… [read more]

History of Swiss Banking System Term Paper

… History Of Swiss Banking

In addition to the secrecy of Swiss banks, they differ from United States (U.S.) banks in two other significant ways, the variety of services offered and the quality of their loans. In the U.S., banks are… [read more]

Economic Data Term Paper

… The fact that the company has higher profits stimulates their further investments.

On the other hand, tax cuts are also equivalent to an attempt to minimize incentives for tax evasion. Indeed, it is assumed that, psychologically, tax evasion appears in conditions where the return compensates the risk implied by committing an illegality. If the return is not that high, then the incentive is diminished.

The main cost is related to the budgetary deficit I have previously mentioned. The main source of income for the government budget is represented by taxes. In the case of tax cuts, it is obvious that this is decreased and that projects benefiting from governmental spending will have to be frozen.

4. The long-term interest rates, as is the case for mortgage rates, adjust themselves slower to the changes produced on the market and to the measures implemented by the Federal Reserve. Additionally, monetary policy is generally associated with short-term financial instruments and the Federal Reserve monetary policies influence these first.

5. In some countries, like Botswana, the infection rate of the population is around 38%

. The impact of this on the country's economy is quite clear and it manifests itself both in terms of production and costs. Indeed, the government needs to have additional health programs within its spending scheme, meant to fight the epidemic. On the other hand, it is clear that the people infected with HIV cannot work at the same potential as healthy individuals and this may show in the overall GDP of the country.


1. Snow: Bush will trim U.S. spending. December 2004. CNN World Business. On the Internet at http://edition.cnn.com/2004/Business/12/20/us.budget.snow/index.html

2. Wolfe, Elizabeth. November 2003. Botswana-AIDS. Associated PressOn the Internet at http://www.achap.org/press/botswana_aids.htm

Snow: Bush will trim U.S. spending. December 2004. CNN World Business. On the Internet at http://edition.cnn.com/2004/Business/12/20/us.budget.snow/index.html

Wolfe, Elizabeth. November 2003. Botswana-AIDS. Associated PressOn the Internet at http://www.achap.org/press/botswana_aids.htm… [read more]

United States From Nigeria Term Paper

… During my years of study and in the Navy for example I have displayed motivation and teamwork skills. I have dedicated my time to working with my fellow students and colleagues, and have worked on maintaining good interpersonal skills at all times. Furthermore my participation in activities such as the rag, a community charity event at our college, as well as my security and front desk work have helped me develop the necessary interpersonal skills to serve effectively in an assistantship.

My plans for the future and for my career are to enter the financial field. My studies and my professional ventures have revealed to me that this is where my interest truly lies. Furthermore I believe I have what it requires to succeed in this extremely competitive field. Setbacks such as the fact that my parents are immigrants without sufficient funds to pay for my education, and my discharge from the Navy, served only to add to my determination for success. I see these setbacks not as problems or indeed as setbacks in themselves, but rather as challenges that can be overcome on the path to achievement.

It is this motivation and determination that I will bring to a graduate program in the financial field. I would therefore like to focus my MBA studies on finance. With this degree I will be able to boost my career, while also serving as an asset to my college. My energy and enthusiasm will serve to not only make a success of my studies, but also to bring the best of quality to any assistantships or community programs on which I serve.

Finally, I believe that my inherent qualities will serve to carry me to achievement in whichever direction I choose. Personally, I believe the most fulfilling career that I could pursue lies in the finance and banking field. Thank you for taking the time to consider my application. I look forward to receiving your reply, and hope that my comments will be…… [read more]

Finance Any Asset Pricing Theory Term Paper

… Another factor is that, as many facets of risks will determine expected returns, as there are factors. (An Introduction to Investment Theory)

These factors of the APT theory, as some recent research suggests, are more effective at predictions of stock returns than even the simplest version of the alternate CAPM would do; in fact, the APT is seen as building on the CAPM and not as replacing it totally. The CAPM, on the other hand, does not take into consideration the co-variants of the stocks in a market. What it does is take an ingenious short cut through the risk factor of stock. It divides the risk into systematic (market) risk and unsystematic. In this manner, CAPM essentially concentrates on the relationship between the systematic risk or beta, and the expected returns. The fact that betas can very well be calculated using an extremely simple formula adds to its value. The CAPM is also able to deliver an assurance to the investor that if you are aware of a particular stock's beta, then you can be sure of its long-term return values. (An Introduction to Investment Theory)

Though most investors question the accuracy of such statements, it has been proven after extensive testing that the CAPM is indeed an accurate testing formula for measuring returns on stocks, and stocks with higher betas do have a higher value of returns. There are doubts, however, that the CAPM will work well only in long-term predictions. The APT on the other hand divides, without specifically stating why, systematic risks into various smaller component risks. The pricing of assets in relation to one another is also explained in this model, rather than explaining the pricing of assets as against an unknown portfolio, as is done in the CAPM theory. Due to this, an investor would be able to address a specific risk that he worries the most about, like, for example, inflation, and eliminate it successfully. (An Introduction to Investment Theory)

Though the APT is considered to be a 'truer' theory than the CAPM, it is true that the former is difficult for the investor to grasp readily, while the CAPM with the simplicity of its working principles, would be a better choice for the investor and the financial professional to use. (From the Article provided) any investor who wants to use the APT would have to be armed with the certain knowledge of the risks involved in an investment. This is a near impossibility, and, in this respect too, the CAPM scores more points. (An Introduction to Investment Theory) I therefore strongly feel that the CAPM is more user-friendly and the better choice for the investor and financial professional of today.


An Introduction to Investment Theory" Retrieved at http://viking.som.yale.edu/will/finman540/classnotes/class6.html. Accessed on 29 July, 2004

Bayesian Approach of the Arbitrage Pricing Theory" Retrieved at on 29 July, 2004

Capital Asset Pricing Model" Retrieved at http://www.investorwords.com/698/Capital_Asset_Pricing_Model.html. Accessed on 29 July, 2004

Definition of Arbitrage Pricing Theory" Retrieved at http://economics.about.com/cs/economicsglossary/g/apt.htm?terms=economic+theoryAccessed on 29 July, 2004… [read more]

Business and Finance Understanding Term Paper

… I believe one of the most outstanding examples of this incorporation of current trends and real life professionals within finance arena with the core concepts of business can be found within McDonough School Of Business and Georgetown. Therefore my choice of a future school, to continue the development of my professional skill set has been wisely driven by my own as well as other's admiration of the standards and practices of the your institution.

The core courses of my business degree have been the most enjoyable classes I have taken, anywhere and applying the knowledge of the text and lectures to everyday experience within my work environment moves the concepts full circle and gives me an even clearer picture of where I see myself in the future. My major at PIMA is finance and accounting, and I have thrived within the academic environment of finance and accounting, which is why I want to continue my education with work experience in the premier financial district in the United States, as well as further academic pursuits.

Imparting the understanding of the importance of business planning within every person's life is a calling for me and I feel that the opportunity to do so within a professional environment would be a natural step for me in my career. I also feel that I can work well with others, and could develop good working relationships with clients from every type of background. Helping people invest wisely for their futures is not only a career to me, it is something that can make a vast difference in people's lives when they most need it, and I would feel great satisfaction in helping people create future happiness and security.

Incorporating and applying large amounts of information and data is one of my strengths, and a valuable tool in finance as well as investment structuring. I like to dig deep into the details of financial instruments, and I enjoy working with people while delving into their investment needs, and their retirement goals and dreams. Teaching others the messages of their own financial history and future would be a formidable career goal, and one I hope to embrace…… [read more]

Economics Why That Dollar Term Paper

… " (Bowbrick 2003).

While it is true that the uses of money have extended to the Internet in interesting ways, it is also obvious that the emergence of e-currency has not occurred as a result of a pressing need. The circumstances are not the same as in ancient times, where money saved the time involved in the barter system. With the advance of the money system, a higher quality of life could be pursued, because there is more time to indulge in the acquisition and consumption of leisure time and goods.

In terms of the Internet, many opportunities have come about to make, invest and spend money online. This has made the use of the credit and debit card increasingly popular. The global economy is affected, since it is easier to spend and receive foreign currency, and opportunities also exist to relieve the need for jobs.

Money is thus more than paper and coins. It has become a complicated system of acquisition, investment and status. The idea of money is often psychological for its inducement of well-being as it is a concrete and physical means of acquiring goods and services. While the money system has solved the time problem involved in the barter system, it has however a number of attached problems, such as inflation and increasing interest rates. Perhaps it is true that money does indeed make the world go round. This is evident in the misery experienced by the poor and the affluence enjoyed by the rich.


Beggs, J. "Euro Under Pressure but Recovery is in The Wind." Euro Economy & Financial Markets,

Beggs, J. "Euro Interest Rates Have Further to Go." Euro Economy & Financial Markets,

Beggs, J. "Sterling Under Pressure." UK Economy & Financial Markets,

Bischoff, B. "Consumer Action: The New Conversion Rules." In SmartMoney.com, October 21, 1998.

Bowbrick, S. "Past Currency." In Guardian Online, February 25, 2003.

Davies, R. & G. Davies. A Comparative Chronology of Money:…… [read more]

Financial Development and Economic Growth Term Paper

… We will then examine as to what extent the development in the financial markets of both the countries have contributed to their economic growth. To measure the effect of financial development, we will make use of regression analysis by assuming… [read more]

International Finance the Performance Term Paper

… A Eurodollar is a deposit held at a foreign bank, but that is denominated in USD.

With respect to the type of instrument, the theory is that all of these different instruments will be sold at par value, once the features have been accounted for. This implies that any option is equally good -- the reality is that a vanilla bond is usually more desirable. These are easier to manage in terms of the issue, and they have greater liquidity as well, which will allow the issuer to recoup the full par value for the issue. Economically, a basic bond is the most efficient structure.

In terms of currency, the bank is using the proceeds of this bond issue to make Eurodollar loans to clients. That is to say, the bank needs to have USD on deposit, so that it can lend out USD as Eurodollars to the clients. This means that the bond issue in question should also be in USD. It is not necessary that clients are in the U.S., as ultimately the source of the USD is not all that relevant, but this should be the currency of issue. The market for USD issues in Europe is sufficiently large and liquid that this is a viable means of issuing debt -- that would not be the case if the bank was seeking to raise funds in most other currencies. Thus, the situation calls for an issue of Eurodollar debt, so that there is no conversion loss when the bank then chooses to lend this money out. The bank will instead be able to issue these Eurodollars and earn a stable, reliable spread when it re-issues those proceeds as loans to clients.


Anand, K. (2014). 100 days of Narendra Modi government: Sensex rallies nearly 9%, top bets. The Economic Times. Retrieved October 8, 2014 from http://articles.economictimes.indiatimes.com/2014-09-02/news/53479975_1_saugata-bhattacharya-gdp-growth-narendra-modi

Stanlib.com (2014). Bond markets and bond market instruments. Stanlib.com. Retrieved October 8, 2014 from http://www.stanlib.com/Individuals/knowledgecentre/Pages/Bondmarketsandbondmarketinstruments.aspx… [read more]

Finance Questions on Capital Raising Advice Term Paper

… Finance

Questions on Capital Raising

Advice on Raising Capital

When businesses wish to expand they are likely to require further capital to support that growth. If the firm does not have sufficient internal capital, they will need to turn to external sources to raise funds, with two main options; debt or equity.

Debt is capital that is raised which will need to be repaid, usually in the form of a loan or the issuance of a corporate bond. The company will then be required to pay interest in the debt, it is usual for the interest payments to be due at regular intervals, such as monthly, quarterly, twice a year or annually, depending on the type of debt instrument used. In some cases, for example loans made to property developers, the interest may be rolled up and payable when the loan is repaid (Howells & Bain, 2007). The lender will make the funds available to the borrower with the aim of making a profit; the profit will come from the interest and fees charged for making the loan. The fees and interest rate will be determined by a number of factors, including the prevailing interest rates and the degree of risk associated with the loan. The potential risk of default is assessed, the higher the risk premium needed by the lender and the more costly the loan, the lower the risk the lower the interest rate (Howells & Bain, 2007).

There are both advantages and disadvantages associated with debt. Debt does not confer any ownership rights on the lenders, and may be popular with the shareholders as it does not dilute shareholding. It can be cost-effective to raise debt, especially compared to raising equity, and when interest rates are low, it maybe argued that debt may be cost-effective, especially if the borrower is able to raise funds on a fixed interest rate loan (Howells & Bain, 2007). However, there are also some disadvantages; debt will require repayment of both the principal and interest payments, which may increase the pressure on the organization and is not required and an equity issue. Where interest payments are made, interest payments are tax deductible. Caveats may be associated with the raising of debt, for example lenders may require security, or require borrowers to make commitments regarding the way in which they will operate, use or dispose of assets or other controls on the organization's activities (Howells & Bain, 2007).

The raising of equity allows the firm to gain an inflow of capital as a result of issuing shares and granting ownership to those who provide the equity. Equity is not a loan, it is an investment, and confers ownership rights on the investors. Where shares issued, each share will contain equal rights in terms of voting, and rights to dividends. Investors will usually make equity investments with the aim of creating profit; this can be achieved through capital growth of the share price, as well as the receipt of dividends. A specific advantage associated… [read more]

Economic Impact Study: Students Research Paper

… Often, college students fall into that category, as do many people who are just out of college and now have a number of student loans they will have to repay in an economy that is not growing or adding new… [read more]

Nigeria: Economic and Human Health Term Paper

… Abraham Nwankwo, is the size of the domestic debt being serviced by the federal government (Amaefule, 2013). Current plans are to shift a portion of this debt to external loans, a move which the World Bank seems to support (World Bank, 2013). Lending by multilateral lending institutions like the World Bank is therefore having a positive impact on Nigeria's economy and social programs, at least for the time being.

Nigeria's economy can be strengthened in a number of ways by improving the health of the populace. The water supply in Nigeria is improving, but only 95% and 57% of private and government sources of water, respectively, are considered safe (World Bank Group et al., 2008). Access to medical services is also extremely limited and many facilities are understaffed and lack the basic equipment and consumables to operate a primary care clinic. Malaria is endemic to Nigeria, yet anti-malarial drugs are still hard to come by in some parts of the country. HIV / AIDS is epidemic in Nigeria and the economic and health aspects of this disease, especially for HIV / AIDS orphans, are substantial.

Should access to safe water sources improve then workers would spend less time being ill and worker productivity would increase. A similar benefit would be obtained by increasing access to anti-malarial drugs and combating the vectors carrying this disease. Mortality and morbidity rates would decline and the growth of a career professional class might become possible. Access to basic medical services, such as maternal health and child vaccination would improve the developmental outcomes of Nigeria's children. The HIV / AIDS epidemic represents a significant burden on taxpayers because of the growth in the number of HIV / AIDS orphans. The diagnosis and treatment of HIV-infected individuals is currently being handled by non-governmental organizations (World Bank Group et al., 2008), but the orphans are the responsibility of the state.

Nigeria's policymakers have instituted a matching grant program to improve healthcare delivery (World Bank Group et al., 2008). The federal government will match local funds with money from debt relief and awards will be based on performance; however, the infrastructure needed to assess the quality of health service delivery is still being worked out. Nigeria has instituted a scorecard assessment program in 9 of 36 states under LEEMP (Local Empowerment and Environmental Management Project) in 2005. Until this reporting infrastructure can be built and optimized, the State Ministry of Health, with the support of the Department of International Development (UK), is fostering the growth of community health committees. The World Bank and other financial partners are therefore helping Nigeria improve its public health system.


Adegbite, Esther O., Ayadi, Folorunso S., and Ayadi, O. Felix. (2008). The impact of Nigeria's external debt on economic development. International Journal of Emerging Markets, 3(3), 285-301.

Amaefule, Everest. (2013, Jul. 22). Nigeria's debt rises to N7.93tn. Punch. Retrieved 3 Nov. 2013 from http://www.punchng.com/news/nigerias-debt-rises-to-n7-93tn/.

Edo, Samson E. (2002). The external debt problem in Africa: A comparative study of Nigeria and Morocco. African… [read more]

Microfinance the New Economic Landscape Research Paper

… Here data has a specific and applied purpose that can be used in a non-profit manner in most cases and demonstrates how cooperation can help raise the wealth and worth of all parties involved.

Wright (2012) argued that big data can ultimately lead to financial inclusion for the neediest around the world. He wrote "the use of big data can actually prove very effective for the fields of microfinance and financial inclusion. we strive to: 1) examine large datasets to find relevant patterns and leverage opportunities, and 2) build tools and systems that use data to enable the poor to improve their quality of life." This is a noble use of big data and demonstrates how MFI's are contributing to the solutions of some of the world's most challenging and questionable problems.

Although microfinance got its start in developing countries overseas, American microfinancial involvement is trending upwards. De Avila (2010) wrote " Funding is a big challenge for all U.S. microlenders and also one of the key reasons why the industry hasn't matched the scale of their counterparts oversees. Most U.S. microlenders rely on donations from banks, foundations and private donors to operate." Big data has played a large role in this growth and success rate.

The era of Big data could bring about new organizational principles and standard operating procedures that will not only affect MFIs but all players in the financial game. Since this is a new practice in the economic world, much improvement can be expected in years and decades to come as the infusion becomes more tightly bound. The use of information cannot be ignored anymore by institutions wishing to stay current in the trends that ultimately dictate the business practices of our society and its incorporation into philanthropy demonstrates how this tool can be used for purposes that transcend market and economic forces.

Issues and Problems With Microfinance's Reliance on Big Data

Unfortunately the collection of big data is sometimes not viewed favorably in the eyes of many critics of the system. Privacy rights are placed at a premium in the argument against big data and its sometimes intrusive approach. It is a very tricky line to walk on all sides and those in leadership positions must be careful to manage this problem in the correct and reasonable manner that takes the entire situation into hand.

Microfinance also has its critics as the failures of this practice are explored in further depth. Karnani (2007) wrote " yet my analysis of the macroeconomic data suggests that although microcredit yields some noneconomic benefits, it does not significantly alleviate poverty. Indeed, in some instances microcredit makes life at the bottom of the pyramid worse. Contrary to the hype about microcredit, the best way to eradicate poverty is to create jobs and to increase worker productivity." This scathing criticism must be taken into account when judging the results of microfinance, but essentially more experimentation needs to be accomplished before determining the true value and worth of these practices.

References… [read more]

Micro Economics: Chapter Summaries Microeconomics Essay

… Summary 'Chapter 8: The Labor Market'

The biggest motivation to work comes from the need to satisfy basic human life requirements like food, shelter, clothing, etc. Humans need money to buy the products and services which they need in their day-to-day life (Hall & Lieberman, 2010). These needs give rise to their willingness to work. As a result, they become a part of the country's labor force. Labor supply refers to the willingness and ability of general people to work for specific time against different compensation (Boyes & Melvin, 2009). Some jobs are high paying while others are too low for a person to live from hand to mouth. If a person prefers to do some other activity or activities instead of work, he has to bear its opportunity cost (Besanko, Braeutigam, & Gibbs, 2011). Opportunity cost is the amount or facility which one has to give up for the sole purpose of availing some other available option (McEachern, 2012). For example, one has to lose his daily wage if he wants to go out to watch live soccer match (Shiller, 2009).

Like other economic phenomenon, labor market also has a specific demand and supply of the labor force. When there is excessive labor available in the country for limited jobs, the wage rates for laborers decreases. On the other hand, if the labor supply is short due to any reason, the wage rate increases. An upward-slopping curve of labor supply says that if there is a labor shortage in the market, the existing laborers have to work additional hours to complete the work. They are only willing to work additional hours if they are paid more than the routine pay (Shiller, 2009).

The market supply of labor is largely affected by the labor demand which is created by the local and international employers (individuals, business entities, non-profit organizations, and governmental institutions) operating in the country. The labor demand created by these employers is solely dependent upon their performance in the industry, e.g. sales, profitability, business expansion strategy, etc. Thus, if a firm performs better in the industry, it tends to hire more individuals and is expected to pay higher wages than other industry participants (Shiller, 2009).

The value of laborers increases when there is shortage of labor in the market. In contrast, their value decreases as employers continue to hire more and more individuals to meet their increasing labor requirements. Marginal physical product (MPP) refers to the change in total output when a single laborer is added to the existing labor force. Marginal revenue product (MRP) is the change which one additional laborer brings in the total revenue (McEachern, 2012).

These changes in output and revenue are largely affected by land and capital (the two most important factors of production) by decreasing the marginal physical product (Boyes & Melvin, 2009; Hall & Lieberman, 2010). This phenomenon is called as diminishing marginal physical product. As the labor supply increases in a market, the marginal physical product of labor decreases (Shiller,… [read more]

Finance Management (Discussion Questions) First Essay

… Firms can address this issue by reinstating the amount into customers' accounts if a firm takes this approach, it must conduct a journal entry to expand accounts receivables and minimize the expense of bad debts. Consequently, this would trigger a reduction in expenses and net income overstatement for the current period. Unless the subsequent reinstatement and the write off occur concurrently, the GAAS matching principle will have been violated (Baker & Powell, 2010).

Third student

Accounts receivable (AR)

When clients buy services or products, often, they do so based on payment terms. This means that they receive the service or product but pay for them later. Usually, this is done on credit terms determined by the company and referred to as accounts receivables. It represents the total amount the clients owe due to a firm exchanging goods in exchange for the promise to pay later. This differs from the debt where a company lends money to another party in return for interest (Brigham & Ehrhardt, 2011).

The importance of managing AR

Managing accounts receivables involves costs. For a firm to maximize its value, it ought to control these costs. Thus, it includes managing opportunity costs, administration expenses and accounts receivables. The importance of managing AR is to control and regulate these costs without eliminating them. Where no credit is granted, costs could be minimized to zero (Salek, 2006).

What affects the ability to control AR and strategies to address issues?

In case a company has many customers with too much money on bills, the overdue restricts working capital and cash flow. This affects the ability to control accounts receivable because it limits the ability of the firm to meet its obligations like loans and accounts payable. Fortunately, a strategy of using computer software helps gather process and organize data in different ways. Therefore, a firm can produce many reports to be used in management insight of financial affairs in various ways that raw data cannot help (Brigham & Ehrhardt, 2011).

Part B

Accounts receivables show the significant percentage of a firm's assets. Because it often represents a notable ratio of a firm's assets, it can be tempted to manipulate its value. Therefore, ethical behavior is critical in maintaining the integrity of a firm's financial statements (Baker & Powell, 2010). This draws companies to adhere to the GAAP rules. Evidently, a firm's accounts receivable asset could be both complex and simple. Its simplicity is shown by the fact that is illuminated on the balance sheet in one control account as one debit figure. Therefore, the asset has one net value demonstrating the balance due to be collected from clients.


Berger, S. (2008). Fundamentals of health care financial management: A practical guide to fiscal issues and activities. San Francisco: Jossey-Bass.

Baker, H.K., & Powell, G.E. (2010). Understanding Financial Management: A Practical Guide. Oxford: Blackwell Pub.

Brigham, E.F., & Ehrhardt, M.C. (2011). Financial management: Theory and practice. Mason, OH: South-Western Cengage Learning.

Salek, J.G. (2006). Accounts Receivable Management Best Practices. Hoboken: John… [read more]

Calculate Touring Enterprises' Weighted Average Research Paper

… 28. The same loan at a 10% rate would cost the consumer $1,610 over the same period. This $400 difference can be monumental for individuals who are experiencing stagnant wage growth. For example, the median household income is $48,000, which… [read more]

Schiller Text Covers Economic Theory Essay

… ¶ … Schiller text covers economic theory vs. economic reality. The chapter starts off by saying that economic theory supposedly tells the government how to keep the economy growing and keep the economy at full employment but that of course never happens. For example, the United States has not been at full employment since the mid-2000's when the rate hovered around 4-5%. The rate has been near or above 8% (and as high as 10%) for the better part of a decade now. The book uses this lesson as a means to prove that while many people in the economic and political sphere may think they know how to prevent massively swinging economic cycles, they do not as they have been happening quite a bit since the Great Depression alone, let alone the cycles that have occurred in the last 20 years or so.

The book then summarizes the different types of policies that can be enacted to combat or prevent economic wobbling and then real-world historical examples are given at the bottom in table 16.2 after the generic examples in 16.1. The book then talks about automatic stabilizers and discretionary policy on page 327. A headline about a record deficit in February 2010 and the general use of monetary policy is described on page 328. In a nutshell, some economic safety nets kick in automatically while others are on an ad hoc basis when the automatic stabilizers aren't doing the job. An example of the latter would be the stimulus acts that are commonly enacted or at least talked about when the economy is faltering or contracting.

Monetary policy is the management of the money supply by the federal government that is used to discourage bad things in the economy and encourage good ones. The rules vs. discretion policy on page 329 is more of the same general subject. There are also some monetary policy milestones given on table 16.3 on that same page. The 2008-2009 cut of interest rates is listed an example and the author of this report does recall that during the late Bush administration and very early Obama administration. Those rates are still in the basement to this very day as they really can't go much further down.

Supply-side policy is discussed on page 330. The book notes that even social safety net reform measures have supply-side implications and welfare reform in the 1990's is cited as an example. Much that same argument has been happening lately with the consistent extensions of unemployment insurance and no abating to the use (and some say abuse) of the SSD system when people are seemingly going from unemployment to SSD when unemployment is exhausted and for seemingly no other clear reason other than the government dole running dry.

The book then talks about inflation, including that caused by an over-heating economy, as well as stagflation which is when inflation and recession are happening at the same time. The overall history of the United States vis-a-vis employment, inflation, GDP… [read more]

Economic Growth. It Starts Off Essay

… ¶ … economic growth. It starts off with discussing how growth typically manifests itself in the short and long-run scenarios that come up. Changes in capacity are obvious in the long run but changes in the USE of capacity are more prevalent in the short run. In other words, how capacity is utilized and changes within the production possibilities curve is a short-run concern whereas the overall ability to make products overall would change more in the long-run.

In other words, Apple could change from 500 iPods and 500 MacBooks per run to 400 and 600, respectively. However, in the future, they could make 1000 of each with no problem but they wouldn't be able to do that in the first example. The book also talks about aggregate supply using that prism.

The book then talks about the difference between real and nominal GDP because they are not the same thing. Nominal GDP refers to the current dollar value of output while real GDP looks at quantity. That difference is real. For example, if 100 iPods cost $30,000 right now (300 a pop), the could cost $40,000 in 10 years. The quantity (real GDP) has not changed but the actual dollar value of those same number of iPods has gone up.

The book then talks about growth indexes as a means to measure living standards or other measures. GDP per capita is cited as a common living standard measurement prism. GDP per worker is also important because it shows how productive the actual workforce is because per capita looks at growth per person across the ENTIRE population including the people who don't or can't work.

The book points to growth in productivity coming from labor quality, management, capital investment, and research and development. In other words, Apple could benefit from smarter people coming to work for them, better managers doing the same, investment from stock purchases and such from outside sources as well as people researching how to make better products and how to make them more efficiently.

The government can also improve economic conditions by altering immigration policy, giving businesses incentive to invest, incentive to save, and offering financing options that would not normally be available and/or in the amounts that are normally there. For example, businesses may get a tax credit on new hires like the HIRE Act in 2010 or they may be allowed to bring in more H-1B Visa workers to cover positions that domestic employees can't or won't fill.

Deregulation and simplification of policies and regulations can also be a boon to businesses at times if done properly. However, some say doing this to excess allows or even encourages bad behavior. One example of this is the financial industry which has been regulated, deregulated and re-regulated in many ways. There was a great loosening in the 1980's but there was also the Savings and Loan scandal. The housing crash that occurred in 2007-2009 and is still recovering is another example.

The book also makes mention… [read more]

Economic Way of Thinking Always Consists Term Paper

… ¶ … economic way of thinking always consists of winners and losers. Something is gained and something must be lost in an economic transaction. Economic thinking is important when modeling and creating objective thoughts, but may hamper more creative and artistic methods of thinking.

Morality is a very subjective topic and one set of morals do not apply to everyone. Unfortunately in this case, Zwolinski's defense of sweatshops is a very limited view of the world and humanity itself. His narrow minded approach to civilization suggests that he does like himself or the world at large very much, and is obsessed with monetary gain.

I disagree with Boudreaux's take on unintended consequences because the viewpoint of intention is taken from a supply side of economic theory. The minimum wage increase will most likely have surprise consequences, which is a better choice of words to describe this occurance.

Question 4.

Friedman's assessment on language and the importance of understanding key terms within certain arguments is accurate in my opinion. Market failures are dependent upon market successes and it's the evaluator's choice on how to view the issue. Markets fail every time someone is dissatisfied with a product., but at the same time it succeeds because new options become available to the consumer.

Question 5.

Powell is generally correct when describing the political landscape of the current environment of today. Powell assumes that politicians act in accordance with law and order which is not always the case however and the system is much more broke than he assumes. A truly free market will be impossible to maintain without regulation so it is a very difficult task to overcome.

Question 6.…… [read more]

Energy Economics Cost and Benefit Essay

… The capital cost associated with energy economics are; sunk, site specific, site non-specific and fixed. (Rothschild 2008)[footnoteRef:16] [16: Bob Rothschild, "Cost Benefit Analysis." (unpublished lecture., Lancaster University, 2008), Lancaster University, http://www.engineering.lancs.ac.uk/lureg/nwhrm/project/Joule Centre conf 08/rothschild.pdf.]

[footnoteRef:17] [17: Bob Rothschild, "Cost Benefit… [read more]

Energy Economics and Negative Externality Essay

… The difference between the market demand and supply at that optimal quantity is required to be known. In other words, the government is required to know the marginal social damage caused by pollution at the optimum quantity (Duke and Kammen… [read more]

Economic Variables Essay

… Coffee Industry Economic Environment:

The coffee market is a mature industry in the United States where the dollar sales growth is fueled by consumers paying high prices for this product. The higher prices for coffee is attributed to four major factors including the increasing costs for raw or green coffee beans, tendency by customers to drink premium coffee, ever-increasing thirst for specialty coffee beverages, and exceptional growth of single-serve coffee packet formats. The United States coffee industry or market is classified into two major categories i.e. foodservice outlets and retail outlets for bulk and packaged coffee. The foodservice coffee outlets primarily sell liquid coffee for take-out or instant consumption on the premises while retail outlets sell coffee products to be prepared by consumers at different locations. Notably, there are some outlets such as Starbucks and other supermarkets that sell both kinds of coffee, which implies that they are concurrently foodservice and retail outlets.

Analysis of the Industry's Economic Environment:

In the past decade, the coffee industry has experienced constant growth and profitability that was temporarily slowed down by the 2009 global economic crisis. In addition to the economic slowdown, the coffee market was also affected by changing consumer tastes, though to a lesser extent (Samadi, 2012). The coffee industry economic environment can be understood through examining some economic variables about the industry such as & #8230;


The coffee industry has been a market that has experienced tremendous growth and productivity in the past decade. The productivity of this industry is evident in its annual revenue growth, especially in the past three years after the 2009 economic crisis. While the industry was affected by the global recession in 2009 that contributed to revenue decline of 6.6%, it has experienced significant revenue growth and productivity of 3.0% and 3.1% in 2010 and 2011 respectively. This productivity has also led to estimates that the coffee industry will continue to be productive at an annual rate of 1.2% in the next five years.

Unemployment Rate:

In the past five years, the coffee industry has experienced marginal growth in employment despite of increase in unemployment during this period. Industry employment rose at an average annual rate of 3.6% to 591,277 employees. However, this is a slow growth rate in employment as compared to previous years when the industry underwent an extensive period of rapid expansion. One of the major reasons for the slow growth in the rate of employment is because many operators consolidated certain underperforming outlets. However, it's expected that industry employment will increase at an annual average rate of 2.1%…… [read more]

Economics Mexico How Interest Rates Term Paper

… By March 2013 the inflation rate had neared the government target and growth in some economic sectors was slowing, so the government made a bold move, decreasing interest rates earlier than expected as a result of the decline in certain sectors, with the aim of limited the slow down in growth; they balanced the need to support growth and constrain inflation.


CIA, (2013), Mexico, [online] accessed 29th April 2013 from https://www.cia.gov/library/publications/the-world-factbook/geos/mx.html

Howells P.G.A, Bain, K, (2007), Financial Institutions and Markets, London, Longman

Hughes, E; O'Boyle M, (2013, April 27), Mexico Holds Interest Rates, Watches Capital Inflows, The Globe and Mail, [online] accessed 30 April 2013 from http://www.theglobeandmail.com/report-on-business/international-business/latin-american-business/mexico-holds-interest-rates-watches-capital-inflows/article11575099/

Index Mundi, (2013), United Kingdom GDP, [online] accessed 30th April 2013 from http://www.indexmundi.com/united_kingdom/gdp_real_growth_rate.html

Index Mundi, (2013), Japan GDP, [online] accessed 30th April 2013 from http://www.indexmundi.com/japan/gdp_real_growth_rate.html

Nellis JG, Parker D, (2000), The Essence of the Economy, London, Prentice Hall

Thompson A, (2013, March 9), Mexico cuts interest rates to record low, Financial Times, [online] accessed 30th April 2013 from http://www.ft.com/cms/s/0/09a53c06-8848-11e2-8e3c-00144feabdc0.html#axzz2Pt0LZYUe

Trading Economics, (2013), Mexico Interest Rate, [Online] accessed 30 April 2013 from http://www.tradingeconomics.com/mexico/interest-rate

Trading Economics, (2013), United States Interest Rate, [online] accessed 30 April 2013 from http://www.tradingeconomics.com/united-states/interest-rate

Trading Economics, I2013), United States GDP Growth Rate, [online] accessed 30 April 2013 from http://www.t Ldingeconomics.com/united-states/gdp-growth

Trading Economics, (2013), United Kingdom Interest Rate, [online] accessed 30 April 2013 from http://www.tradinge Wnomics.com/united-kingdom/interest-rate

Mexico's…… [read more]

Reconstruction Finance Corporation Research Paper

… Reconstruction Finance Corporation

The creation of the Reconstruction Finance Corporation can be attributed to the period when there numerous government interventions in business operations. This was a period that was commonly referred to as the classically liberal political philosophy of many American administrations. This occurred before Herbert Hoover restricted their market interference to seemingly few peacetime interventions. The Reconstruction Finance Corporation was also established through the enactment of an Act by the Congress. Following his signing of the Reconstruction Finance Corporation Act, President Hoover stated that the measure established a powerful organization with enough resources to strengthen weaknesses that may occur in the country's credit, banking, and railway structure. As evident in its history, the Reconstruction Finance Corporation played a critical role in accomplishing its objectives.

Purpose of the Reconstruction Finance Corporation:

The purpose of the Reconstruction Finance Corporation can be identified through President Hoover's statement after he signed the Reconstruction Finance Corporation Act. The enactment of this act established a powerful organization with sufficient resources to foster the limitations that may develop in the country's credit, railway, and banking structure ("Statement about Signing," n.d.). The establishment of this corporation was to enable business and industry to conduct normal activities without any doubt of unexpected shocks and retarding impacts.

According to President Hoover, the main purpose of the Reconstruction Finance Corporation is to end deflation in agriculture and industry, which in turn increases employment through restoration of employees to the ordinary jobs. However, the Reconstruction Finance Corporation was not established to aid bug banks or industries because such institutions have the ability to take care of themselves in light of their operations.

In contrast, the corporation was created for the support of smaller banks and other financial institutions. The corporation was to provide the support to such institutions through depicting their resources liquid in order to offer improved help to business, agriculture, and industry. As a result, this organization would be a crucial part of the country's financial operations since it provides an opportunity to mobilize huge strength for the country in her recovery initiatives.

History of Reconstruction Finance Corporation:

The Reconstruction Finance Corporation was established and started its operations on February 22, 1932 ("Final Report," n.d.). The initial principal function for the Corporation was to expand financial help to commerce, agriculture, and industry through the channels of direct loans to financial institutions, banks, and trust companies. During the initial period of its operations, the Reconstruction Finance Corporation was responsible for loans to railroad companies and their receivers through the approval of the Interstate Commerce Commission.

The succession of the Reconstruction Finance Corporation was initially scheduled at 10 years, though new loans could be…… [read more]

Economics Government Regulations Term Paper

… The "perfect market" that is fully self-regulating relies on perfect information and no externalities, two assumptions that do not hold in the real world. Moreover, the process of self-regulation takes time, and will never really be achieved -- equilibrium only… [read more]

Economic Scenarios Higher Interest Rates Essay

… For a different reason, interest rates were very low during World War II. "During World War II, the Fed concentrated on maintaining 'low' interest rates so that the U.S. Treasury could sell enough bonds to finance the war….his policy pumped large quantities of inflationary new money into the monetary system. To hide inflation, the administration and Congress imposed direct controls on prices, wages, and production" (Timberlake 2008).

Higher interest rates, less capital invested

High interest rates with relatively low levels of capital were characteristic of the early 1980s; right after the Fed dramatically increased interest rates to curtail inflation. The U.S. went through a severe recession before the economy began to recover (Solomon 2008).

Which of these four scenarios are most important today? Which scenario is most conducive toward economic growth? Which scenario is the most normal historically?

Today, interest rates are low, but there is relatively little capital being invested because of concern about the economy. The scenario most conducive to economic growth are low interest rates and high levels of capital investment, which means that it is cheap to borrow and there are many incentives and opportunities to invest in expanding enterprises. In general, in America it has been more common for interest rates to be relatively high to combat inflation (given that prices are almost always going up) combined with relatively high rates of capital investment.


Barr, Colin. (2008). The darker side of interest rate cuts. CNN. Retrieved:


Solomon, Paul. (2009). What led to the high interest rates of the 1980s. PBS.


Timberlake, Richard. (2008). The original Federal Reserve System. The Concise Encyclopedia

of Economics. Retrieved: http://www.econlib.org/library/Enc/FederalReserveSystem.html… [read more]

Economic Final Report Term Paper

… The state dictates jobs that individuals will do and sets prices of services and goods. Currently, countries that use command economic systems include North Korea and Cuba (Conklin, 61).

Traditional economic systems are mostly common in non-developed nations. Such systems are being practiced in countries such as Middle East, South America, Asia, and Africa. Economic decisions are governed by customs and technology is not applicable. Gathering, farming, and hunting are carried out using similar methods used in previous generations. Ethnic and family units motivate economic activities. Women and men carry out different economic tasks and roles. In mixed economic systems, individuals and the state participate equally in the process of making decisions. The state regulates and guides the production of services and products in the market place. Individuals make economic decisions that ensure workers and consumers are not exploited by unfair policies. This has been the most effective economic system in the provision of services and goods. In the current world, mixed economies include nations in Western Europe and the U.S.(Gregory and Robert 133).

How each economic system resolves resource allocation issues

In free economic markets, allocation of resources is determined by the willingness and ability of groups and individuals to pay more for goods. Such market principles are applied in the U.S. In command economic systems, the state dictates how resources are allocated. A good example is the U.S.S.R. In mixed economic systems, some resources are allocated using free markets and others are allocated through government dictatorship. A good example of a mixed economic market is whereby the state subsidizes certain economic activities in a free market (Conklin, 88).

The role of government in different economics systems

The government's role in all the economic systems is provision of legal systems enforcing laws and protecting rights of private property. The government provides public goods where the private business sector and individuals cannot provide. The government is responsible for correcting market failures including economic slowdown and external costs. The government provides public goods such as defending people against security invasion, transportation systems such as highways and traffic lights, public education, clean water and air (Gregory and Robert 151).

Factors of production including examples and their role in the production of goods and services

These factors include labor, land, and capital inputs in production. Land is the primary source of all the material richness and immensely importance. Countries appreciate the richness of their land like climate, soil, and rainfall because they influence all economic aspects of life. Energy and materials are categorized as secondary production factors in classical systems of the economy because they originate from capital, labor and land (Keese, Pete and Ge-rard, 37). The factors are used in facilitating production of goods, but they do not form part of the product itself. Similarly, the production process does not cause any significance transformation on them. Land as a primary factor of production, entails the production site, as well as the soil and above all the natural resources. Land, as a production… [read more]

Finance One Difference Between Industries Multiple Chapters

… DQ1, Chapter 5, 6. Investors are seldom made whole with the "make whole" provision. A premium of 0.4% over Treasury is not consistent with the risk level of the firm. The YTM on the bond will reflect the actual credit quality of the bond, but ECY is not nearly large enough to have AAA credit, so the make whole provision does not apply a significant enough risk premium to the bonds -- the investors are not entirely made whole.

7. I would recommend regular coupon issue for a couple of reasons. The first is that the company raises more money in the short run, though it pays out more in interest down the road. However, regular coupon bonds are also more common and therefore have a bigger market. With greater liquidity, ECY can get a slightly better rate of return, since liquidity is a factor in the market price of bonds. I recommend the option that gives ECY more money up front and a bigger market for the issue -- regular coupon bonds. I recommend an ordinary call feature for the bonds. ECY would get more up front for the make whole provision, but there is less certainty with respect to future cash flows -- what it would cost to call the bonds down the road, since that would depend on the Treasury rate.

DQ 2, Chapter 20 Closing Case

5. The company should pursue international sales if these sales have a positive contribution margin. With the 0.73 exchange rate, the company's contribution is as follows:

Gross, €


less comm, €


Net Revenue, €


FX rate


Revenue, $




Operating Profit, $


With the 0.80 rate, the contribution is as follows:

Gross, €


less comm, €


Net Revenue, €


FX rate


Revenue, $




Operating Profit,…… [read more]

Big to Fail Problem?: Economic Growth Term Paper

… ¶ … Big to fail problem?: Economic Growth

As stated by the New Classical Model, economic growth can be attained by collecting labor, wealth and other issues of production. For the reason that most of these factors are going through… [read more]

Economics the Keynesian Economic Theorists Term Paper

… The economic policies imply that the U.S. is ready to reduce trade deficit, find new markets for locally produced goods, increase industry, and manufacturing, increase foreign exchange, increase income through job creation, and reduce unemployment. This leads to a trickle-down effect as a reduction in budget deficit implies a reduction in trade deficit, which in turn will reduce and end currency manipulation by other major currencies like Chinese Yen. The changes in economic policies imply the U.S. will increase regulation and stringent policies on trade, public budgets, jobs, and investment with the aim of ending currency manipulation that is the cause of the decline and near death of American manufacturing.


Protectionists theory on trade policies argue that international trade contributes to the increase of economic problems like the large and persistent budget and trade deficits, slow economic growth and problems with many industries. The theory believes protectionist trade policies will protect local economy by restricting trade through tariffs and quotas. The theory believes the free trade policies led to liberalization of the market as the U.S. competed with nations like China with a better comparative advantage. This comparative advantage meant the U.S. experienced an unbalanced trade relation that saw the rise of currency manipulation, the weakening of the dollar and the fall of the industrial and manufacturing sectors. This in turn led to an increase in budget deficit as the government moved in the balance and support with surpluses social welfare services. However, under protectionist policies, the domestic production will increase as industries are protected from imports, workers, owners, and suppliers will benefit from using local resources. This also leads to increased tariff revenue on the government as industry and manufacturing grows. In turn, expansion of the domestic production will lead to less competition from imports driving the demand for domestic goods. However, protectionist policies may harm industries as consumption decreases as prices of goods rises, and output declines as prices rise. In the long run, domestic production declines from high prices, revenues, and lack of competition from imports.

Works Cited

Baumol, William J. And Stuart Alan B. "Macroeconomics: Principles & Policy." 12th ed. Mason, OH: South-Western, Cengage Learning, 2012. Print.

Free, Rhona C. "21st Century Economics: A Reference Handbook, Volume 1." Thousand Oaks, California; SAGE Publications, Inc., 2010. Print.

Padalkina, Dina. "The Macroeconomics of De-Growth- Can a De-Growth Strategy be…… [read more]

Basel III in What Sense Term Paper

… There is going to be a further decline in the ROE in the retail-banking activities of the banks that meet the criteria of being global systemically important financial institutions (G-SIFIs). This decline in ROE is expected to be between 0.4… [read more]

Finance Function of Global Corporation Article Review

… ¶ … Finance Function of Global Corporation," discusses the ramifications of the increasingly global marketplace for CFO's and those in organizational decision-making roles as financial operatives. The author uncovers both positive and negative consequences of the opportunities afforded to such employees who must deal with issues at the local, national and worldwide levels while considering the impact of their decisions on both subsidiaries and parent countries. In addition to stratifying contemporary responsibilities according to areas of finance, capital budgeting and risk management, he also offers a series of best practices that allows individuals and entities to take advantage of changes in the emerging global marketplace.

One of the strengths of this document is the author's usage of actual case studies to illustrate many of his concepts. From this point-of-view, he is at his best when detailing the global capital budgeting mistakes of Japan's Asahi Glass or AES's missteps in the early 1990's related to poor valuation decisions for investment opportunities. As elucidating as some of these examples are, however, there are certain points in the article in which there appears to be a dearth of analysis of these case studies. This fact is most eminently reflected in the global capital budgeting section of the article in which he chronicles companies' capital mishaps, yet devotes precious little attention to more profitable approaches. Or rather, he simply alludes to more advantageous measures, cautioning against "adopting a narrow financial approach" that results in "an outcome directly at odds with the company's strategic investment" (Desai, p.2).

Still, it is this sort of understatement which lies at the root of the author's intention in writing this article. In many respects, this piece of literature functions as a means of enlightening financial professionals about the (literal) world of opportunities around them, and urges them to abandon traditional thinking based on a local or domestic view of an organization. The principle theme of the author's article is that because of increasing efforts towards globalization, financial responsibilities for many companies include not only conventional ones but the management of "what amounts to internal markets for capital" (Desai, p.1), which is a reference to the common trend towards having international subsidiaries. Due to differences in currency, local political and economic conditions, the effective management of those subsidiaries requires a wider, less streamlined approach than simply managing a traditional company in one domestic location does.

One of the more effective passages in which the author reinforces his assertion that the financial management of international subsidiaries is substantially different from the conventional notion of financial management is in the section where he discusses a multitude of financing options afforded by international subsidiaries. In this passage, he elucidates a number of specific options that readers can readily take advantage of, which provides the best support for his theme. For instance, he explains how it is possible to exploit differences in tax and interest rates in international settings by the…… [read more]

Economic Situation Term Paper

… In brief, the nation's unemployment rate still hovers just under 8%; the CPI was a -.3 in November 2012, then 0 in December 2012; January 2013 U.S. Import price index moved from -.5 in December to .6, but 4th Quarter productivity statistics are down -2.0 while the employment cost index for 4th Quarter 2012 remains about a steady .5 (Economy at a Glance, 2013).

Still, on an overview, the U.S. economy is the world's largest national economy with a nominal GDP at almost $16 trillion, or about 25% of the global nominal GDP. Growth is sluggish at 1.5% with inflation at 1.7%. Federal, state and local governmental spending account for about 30% of the gross domestic product, and the federal government's debt rose another $1.09 trillion in 1012, or about 100.5% of GDP. The U.S. remains committed to about five major trading partners, all of which affect the economic outlook for 2013 (China at almost 20%, Canada, 14%, Mexico, 12%, Japan 6%, and Germany 5%). Of some alarm, though, is that Standard and Poor's, Moody's and Fitch's economic indicators are all negative for at least the first part of 2013, certainly requiring the Federal Reserve to become more aggressive in its fiscal policies to improve the robustness and quicken the growth of the national economy (Credit Ratings, 2012; Sahadi, 2012; National Economic Trends, 2013).


Credit Ratings: How Fitch, Moody's and S&P Rate. (2012). The U.K. Guardian. Retrieved from: http://www.guardian.co.uk/news/datablog/2010/apr/30/credit-ratings-country-fitch-moodys-standard

Economy at a Glance -- The United States. (2013). U.S. Department of Labor Bureau of Labor Statistics. Retrieved from: http://www.bls.gov/eag/eag.us.htm

Jobless Claims Fall More than Expected. (February 14, 2013). The New York Times. Retrieved from: http://www.nytimes.com/2013/02/15/business/economy/jobless-claims-in-us-fall-more-than-expected.html?ref=economy&_r=0

National Economic Trends. (January 30, 2013). The Federal Reserve (St. Louis). Retrieved from: http://research.stlouisfed.org/publications/net/page24.pdf

Recap of Obama's 2013 State of the Union Address. (February 13, 2013). The New York Times. Retrieved from: http://www.forbes.com/sites/brighammccown/2013/02/13/2013-state-of-the-union-recap/

Retail Sales Show a Slight Increase. (February 13, 2013). The New York Times. Retrieved from: http://www.nytimes.com/2013/02/14/business/economy/us-retail-sales-show-slight-rise-in-january.html

Perlo, A. (February 13, 2012). The U.S. Economic Situation and the 2012 Elections. Political Affairs.net. Retrieved from: http://politicalaffairs.net/the-us-economic-situation-and-the-2012-elections

Rampell, C. (December 16, 2012). Forecast is Sunnier, but Washington Casts a Big Shadow. The New York Times. Retrieved from: http://www.nytimes.com/2012/12/17/business/economy/fiscal-cliff-casts-big-shadow-on-sunnier-2013-economic-forecasts.html

Sahadi, J. (October 5, 2012). Deficit Tops $1 trillion for 4th Straight Year. CNN MONEY. Retrieved from: http://money.cnn.com/2012/10/05/news/economy/us-deficit/index.html?hpt=po_c2… [read more]

Economic Indicators Assessment

… Economic Indicators

Savings Rate

Economic Indicator- the savings rate is the income that is not spent and is instead differed for consumption. In some instances, saving can also include reducing recurring costs such as a cell phone, or cable bill. In essence, individuals preserve money now, for a predetermined use in the future. This money is usually deducted from an individual's disposable income to use for future investment. The savings rate is an economic indicator of individual's propensity to save. This has implications in regards to the overall indebtedness of the nation. It can also indicate the purchasing power available for discretionary purchases.

Rate of Value -- 3.4% as of October 2012

Source of Information -U.S. Bureau of Economic Analysis,

"United States Personal Saving Rate." United States Personal Saving Rate. N.p., 7 Jan. 2013. Web. 02 Feb. 2013.

d. Date of information- January 7, 2013

Prime Lending Rate

a. Economic Indicator- the prime interest rate is a universal interest rate that applies to banks and other financial institutions. This rate is usually the rate that is used to lend to favored customers with high credit quality. The prime rate is a universal interest rate that applies to all financial institutions irrespective of geographic location. The prime rate is also an indicator of overarching fiscal and monetary policy. To encourage spending and refinancing, the prime may become lower. If the rate is raised, the cost of borrowing increases, which ultimately tapers consumer borrowing efforts.

b. Rate of Value- 3.25%

c. Source of Information- "Prime Lending Rate." Prime Lending Rate. N.p., 30 Jan. 2013. Web. 02 Feb. 2013.

d. Date of information- January 30, 2012

3) Mortgage Rate

a. Economic Indicator- the mortgage rate is usually applied to a fully amortizing mortgage loan where the interest rate either remains fixed or "floats." With single fixed rates, the individual benefits from a constant rate of interest. Floating rates however are variable and often change due to the economic circumstances prevailing during the period. Much like the prime rate, the mortgage rate can be used to encourage and discourage lending. A lower rate, as is currently prevailing today, encourages consumers to refinance or enter into fixed rate mortgages.

b. Rate of Value- 3.60%

c. Source of Information- Reddin, Tom "Insights on U.S. Mortgage Rates from Tom Reddin." Mortgage Rates RSS. N.p., 30 Jan. 2013. Web. 02 Feb. 2013.

d. Date of information- January 30, 2012

4) Treasury Bill Rate

a. Economic Indicator- Treasury Bills are the debt financing instruments of the United States government. Treasury Bills are unique as they mature in one year or less. They do not pay interest, but are instead issued at a discount to par value. Investors in general, consider treasury bills to have very limited risk as they are backed by the full faith and credit of the United States Government. Treasury Bills are also used by many large companies as a use for short-term cash or emergency funding. Low treasury rates may indicate a growing need for… [read more]

Private Sector Investment and Economic Literature Review

… Further considerations on the unlikely eventualities are incorporated. In this case in order for sustainable development to occur through private investment there is need not only for saving to provide borrowing funds. There is also the need for stability and… [read more]

Economic and Quantitative Analysis Topics Term Paper

… The United States has shifted in a major way on two different occasions over its existence. First, they went from an agrarian economy to an industrial one and now they are shifting to a service/knowledge foundation while the once dominant manufacturing industry in that country is becoming an afterthought except when speaking of advance/high-tech manufacturing. If someone were to analyze the United States economy over its entire existence, using a singular and fixed model would be asinine and obtuse because of these seismic changes that have occurred. Looking at the United States economy now through a year 1840 lens would be silly.

In a similar vein, looking at Nigeria now would require a certain model and that model would exhibit certain patterns and trends. However, all of the above would change demonstrably over time and the model would have to be adjusted with variables having to be adjusted, removed or added as time goes on. Any adjustments to the model would need to be based on real-world results and patterns and not simple conjecture and theory.

Analysis Summary

As already noted above, using regression analysis can be instructive and useful and can indeed yield some great insights. However, factors and variables that are external to the primary variables and metrics being looked at should not be ignored when they can and would affect the variables that are the primary focus. As long as the primary variables being looked at are not being looked at using tunnel-vision, then the primary variables should be the focus and those variables will be what get the job done unless they're wrong or there's not enough being looked at in an exhaustive fashion.

One very large variable that complicates research is noted by Temple and Johnson (1998) when they make reference to social capability. This is something that makes a lot of people froth at the mouth but the social norms and structure of a country certainly have an effect on economic patterns and outcomes. Islam (1995) says much the same thing when it is noted that the production function and performance will vary from country to country. The model of Solow, as mentioned by Mankiw et al. (1992) show a correlation between per capita income and poverty and the exports vs. service sector paradigm in Nigeria certainly feeds that model's results and proves it to be right.


In conclusion, regression analysis in an economic context can and does work but it must be done in a common-sense way. Data and external elements that should be taken serious and should be included in any analysis should be retained while elements and variables that are indeed not consequential to the situation should be ignored or at least put on the periphery for further review later as needed. Lastly, economics is absolutely one of those sectors where politics and biases can pollute everything. Many people are Keynesian purists while others swear by supply-side theory until they die. There is no singular answer to the economic questions… [read more]

China and the Economy Chinese Research Paper

… A pro-consumer policy can go a long way to alleviate this dependency. It will allow growth internally in regards to wealth and GDP. Instead of being reliant on foreign consumers, China can instead rely on its internal citizenry. In order… [read more]

Great Recession Term Paper

… ¶ … Policy Choices of the Future Path of the Economy

I left school in 2006 to begin service in South Korea's military. In 2007, many South Koreans were taken by surprise by the news that the U.S. economy was… [read more]

Sustainable Development and Economic Growth? Essay

… It must integrate the best thoughts that are from the market economy nonetheless stress collaboration rather than competition (Hennicke, 2005). Experts believe that they need a shared principle that gives all people the chance to understand one's potential, within the natural boundaries of earth (Hettiarachchi, 2012). Experts that only then people can start to trust that there will someday be enough cake for everyone to have

In conclusion, it is clear that 'economic growth' does indeed constitute a crucial element of 'sustainable development. With a worldwide economy, it is on right that people need to rethink the fundamentals of economics for the reason that with the monetary organization we are given with in these times, sustainable development and economic growth will not be able to achieve simultaneously, it just will not be possible.


Abstracts from the society for clinical trials annual meeting, Miami, may 21-23, 2012. (2012). Clinical Trials, 9(4), 450-554.

Hennicke, P. (2005). Long-term scenarios and options for sustainable energy systems and for climate protection: A short overview. International Journal of Environmental Science and Technology: (IJEST), 2(2), 181-191.

Hettiarachchi, S. (2012). Sufficiency and material development: A post-secular reflection in the light of Buddhist thought. European Review, 20(1), 114-130.

Huesemann, M.H. (2003). The limits of technological solutions to sustainable development. Clean…… [read more]

Argentina Political Factors Research Paper

… Argentina

Political System

Argentina was founded in 1816 as the United Province of Rio Plata, and today's nation is what remained after Bolivia, Paraguay and Uruguay split from that country (CIA World Factbook, 2012). Argentina is a republic, and throughout… [read more]

International Finance Asia Essay

… ¶ … Asian Miracle to an Asian Century? Economic Transformation in the 2000s and Prospects for the 2010s, Yiping Huang and Bijun Wang concern themselves with the transformation of Asian economies in the past decade. The authors further speculate on… [read more]

Marxian Economics Karl Research Paper

… The variable capital reflects the labor force, which produces value through its own input, as well creates excess; its value varies across time and space.


The concept of the surplus value reveals the generation of profits, as what is resulted from the difference between the resources invested and the final results of the process. According to Karl Marx, who also assesses the surplus value through the lenses of labor:

"The consumption of labor power is at one and the same time the production of commodities and of surplus value. […] The surplus of the total value of the product, over the sum of values of its constituent factors, is surplus of the expanded capital over the capital originally advanced" (Munro).

In the most simplistic formulation then, the surplus value represents the profit of the business agent. According to Marx, the profit is then composed of three important elements, namely the interest on capital, the rent on land and the physical capital, and last, the normal profit of the entrepreneur, or the wages of entrepreneurship.


While the entrepreneurs often seek to increase their profits, the actual profitability rate tends to decrease within the long-term. This conclusion was reached by all economists from Adam Smith, to David Ricardo and even Karl Marx, yet each had their on explanation for the phenomenon. Marx as such contended that the economic agents come to focus more on development and advancement, and that they come to invest more and more in this direction. In other words, they spend larger portions of their capitals on new investments and this decision negatively impacts the ultimate profitability rate.


Last, the final focus of the Marxian economics falls on the definition of the concepts of monopoly capitalism, impoverishment and crisis. The concept of the monopoly is explained through the accumulation of wealth, through repetitive actions and advantages, in the hands of a few. In the monopolistic market place, the smaller companies will either be driven out of business as uncompetitive, or will be absorbed into the monopoly.

The monopolies, almost always, thrive through the exploitation of labor and they seek to maximize profits; they nevertheless fall into the same pattern of long-term decreases in the profitability rates. The monopolies will seek to counter act this trend by further exploiting labor, which will generate additional unemployment (further supported by technology integration). The working classes will as such be exploited and impoverishment will be created, alongside with the emergence of crisis situations. This virtually reflects the contradiction of capitalism (Richards, 2002).


Munro, J.H.. Some basic principles of Marxian economics. University of Toronto. http://www.economics.utoronto.ca/munro5/MARXECON.htm accessed on October 1, 2012

Prychitko, D.L. Marxism. Library of Economics and Liberty. http://www.econlib.org/library/Enc/Marxism.html accessed on October 1, 2012

Richards, A. (2002). Development and modes of production in Marxian economics: Harwood fundamentals of applied economics. Routledge Roemer, J.E. (1989). Analytical foundations of Marxian economic theory. Cambridge University Press

(2012). Marxian economics. http://www.investopedia.com/terms/m/marxian-economics.asp#axzz282TzXTAm accessed on October 1,…… [read more]

Business Economics the Limitations Essay

… As a result, there are high chances of upgrading productions and increasing revenue especially in enhancing innovations. For instance, frictional unemployment can lead to people changing profession to engage in businesses that suite a person's interest. This is clearly a way of improving performance in the business and employment industry. In addition, it is important t note that by working passionately one can produce more than one who is working under pressure. Similarly is the importance of frictional unemployment in a nation.

Once the government and leadership of a nation have realized this aspects and it implications then the government can come up with additional job opportunities, business forums, and entrepreneur programs that will lead to economic recovery. However, it is crucial to note that it is an individual effort that can easily eliminate such a situation. Therefore, it calls for team work to reduce frictional unemployment.

Chapter 16, Question 11

Types of Unemployment

The three types of unemployment are

i) Frictional unemployment: this refers to the category of people with capabilities of performing well in their areas of work. They are people who may have drooped out of their employment, school leaver etc. They are people that are temporarily waiting and looking forward for better opportunities to earn a living. On the other hand, it refers to the state of seeking for preferred employees in a given company. This is likely to a short-term circumstance (Tucker 170).

Frictional unemployment can be worked out by government temporary jobs. For instance, summer job programs that serve for a short while can provide temporary employment for school leavers.

ii) Structural unemployment: it is a long-term situation that arises from the mismatch of employment. Often it comes up when people with less skill are fired from their employment due to under performance. Therefore, in this category there are vacancies but the people may be under qualified. This calls for extra effort for one to improve in skills and knowledge to get employed (Tucker 171).

iii) Structural employment can be combated by introducing programs that equip people with basic skills that can help them come up with small businesses to cater for their primary needs. On the other hand, rural area development programs playa leading role in reducing structural unemployment.

iv) Cyclical unemployment: this is unemployment that results from business cycles. For instance there are times when the GDP falls. At this time companies may prefer to reduce their workers thus leading to a scramble for the few jobs left. Factors which can contribute to this state of affairs include increased government spending, consumption, or investments thus affecting production rate. Cyclical unemployment pushed people to the edge to find extra means of earning (Tucker 172).

EAP program are a reliable means for the government to reduce cyclical unemployment because such programs come with compensation that is given automatically. That is all those who have gained from any inflation are made to compensate those who have lost.

Works Cited

Gwartney, James D., Stroup, Richard L.,… [read more]

Securities and Exchange Commission (SEC) Essay

… For example, when a company conducts an IPO, it is tapping the investing public for capital and is therefore using the capital markets. This is also true when a country's government issues Treasury bonds in the bond market to fund its spending initiatives (Sanusi,1984).

The laws that govern the securities industry in America stem from a simple concept: all investors, whether large institutions or private individuals, should have access to certain basic facts about an investment prior to buying it, and so long as they hold it. To achieve this, the SEC

requires public companies to disclose meaningful financial and other information to the public.

This provides a common pool of knowledge for all investors to use to judge for themselves whether to buy, sell, or hold a particular security. Only through the steady flow of timely, comprehensive, and accurate information can people make sound investment decisions.

The SEC oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors, and mutual funds. Here the SEC

is concerned primarily with promoting the disclosure of important market-related information, maintaining fair dealing, and protecting against fraud. The SEC's effectiveness in each of these areas is its enforcement authority. Each year the SEC brings hundreds of civil enforcement actions against individuals and companies for violation of the securities laws. Typical infractions include insider trading, accounting fraud, and providing false or misleading information about securities and the companies that issue them.


S.E.C. (1982). "The Role on the Capital Market in the Structural Adjustment Programme (SAP)," Lagos, SEC Quarterly June, Vol 4, No 2.

Sanusi, J.O (1984). The Capital Market: A Boost to Economic development (The banking Aspect)" Seminar Paper on the Capital Market, Lagos.

Matthew Shane., 1970. Capital Markets and the Process of Economic Growth, 77 i.e.…… [read more]

Deregulation and the Impact on Global Finance Research Paper

… Glass Steagall

"Bring back the Glass-Steagall Act of 1933 which led to half a century, free of financial crises" (Denning, S. July 25, 2012. PP. 1). Articulating this position was not a democratic senator looing to harness in the power and influence of the Wall Street money center banks, but rather the architect in the late 1990's of the global mega financial institution; Mr. Sandy Weill former CEO of Citigroup. Weill is a pivotal figure in the timeline of Glass- Steagall's repeal in 1999 via the Financial Services Modernization Act, and the legislation's role in sowing the seeds of the global financial crisis of 2007-2009. Weill's July 2012 statement regarding Glass- Steagall demonstrates the enormous impact which Wall Street exerted over the economic landscape throughout the last two decades, and the importance of a strong and reasoned regulatory infrastructure to oversee its activities.

Glass- Steagall

Following the stock market crash of 1929 and the four subsequent years of the Great Depression, America's financial system had deteriorated with the banking system in tatters, savers ruined, and credit and lending brought to a standstill. As part of the ameliorative effort to bring soundness and solvency to the system, the FDR Administration promoted multiple fixes to the regulatory regime: FDIC, national banking holiday, Reconstruction Finance Corporation, and the Securities and Exchange Commission. Yet, perhaps no piece of legislation was more critical to the nation's restoration of the embattled financial system than the Glass-Steagall Act. "In 1933, Senator Carter Glass (D-Va.) and Congressman Henry Steagall (D-Ala.) introduced the historic legislation that bears their name, seeking to limit the conflicts of interest created when commercial banks are permitted to underwrite stocks or bonds" (PBS.org. N.D. PP. 1). In the simplest context, Glass- Steagall erected a…… [read more]

Greece's Debt Crisis Causes and Solutions Essay


The current crisis that surrounds the Greek economy has been the first ordeal that has been felt in the market of Eurozone area. Such conception is certain to draw attention on academic research on… [read more]

Define Economics Research Paper

… Models enable experiments. For instance, economists can manipulate interest rates to understand their impact or test to see if fiscal stimulus packages will produce the desired results in the economy. The model allows for more definitive statements to be made about causality (Stapleford, 2012).

There are downsides to models, however. They rely on assumptions which are often not based in reality. If the assumptions are incorrect, the conclusions drawn for models will also be invalid (Encyclopedia Britannica, 2009). Thus, it is an important task of economists to constantly refine models and compare them against actual data. By adjusting models in areas that underperform under this comparison, improvements can be made to provide strong insights and intuition into how the world works (Funderburk, 2012).

The debate of whether economics can be referred to as an actual science is a challenging one. One of the more interesting arguments is that economics is simply an artifact of human imagination with no basis in physical reality other than what is identified by the players (humans) to be components (Funderburk, 2012). Properties are determined by and limited only by the beliefs of the players.

In order to build economic models, one must assume certain features, and the models become part of the generators of the results. Since none of this is fundamentally tied to physical and biological reality, the model fails time and again as our physical and biological world view changes -- or as people believe the physical and biological world exists. Thus, critics argue, economics is in large part merely a reflection of human belief systems.


"Economics." Britannica Concise Encyclopedia. Chicago: Encyclopedia Britannica, 2009. Credo Reference. 3 Sept. 2010. Web. 10 Aug. 2012. http://ezproxy.adler.edu/login?qurl=http://www.credoreference.com/entry/ebconcise/economics

Funderburk, D.R. (2012). Is the "New Economics" Either New or Economics?. National Social Science Journal, 38(2), 20-28.

Stapleford, T.A. (2012). Measuring America:…… [read more]

Economics There Is a Belief Term Paper

… Phillips Curve

Theories offer possible solutions to problems that do not have sufficient hard evidence to make one solution likely. In the case of economies, the process through which they are controlled is not known, and the interactions between elements… [read more]

Globalization and the Impacts in the Politics of Authority Essay

… Globalization and the Impacts in the Politics of Authority

Does globalization impact in triggering recent economic recession?

The current financial crisis will be remembered as one of the most serious in the history of world capitalism. The increasing difficulty experienced… [read more]

Macro-Economics Macro Economics There Are Numerous Issues Term Paper

… Macro-Economics

Macro Economics

There are numerous issues that governments must refer to when developing the strategy that the budget must be based on. Such issues are represented by fiscal and monetary policies. Fiscal policy is represented by the strategy developed… [read more]

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