General Motors Essay

A vehicle for each handbag and purpose† †Alfred P Sloan Jr, Former President and CEO General Motors. General Motors, one of the world’s biggest automakers, follows its underlying foundations back to 1908. With its worldwide home office in Detroit, GM utilizes 205,000 individuals in each significant locale of the world and works together in exactly 157 nations. GM and its vital accomplices produce vehicles and trucks in 31 nations, and sell and administration these vehicles through the accompanying brands: Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM’s biggest national market is the United States, trailed by China, Brazil, Germany, the United Kingdom, Canada, and Italy. Organization History: General Motors was established on Wednesday, September 16, 1908, in Flint, Michigan, as a holding organization for Buick by William C. Durant. Durant began obtaining numerous organizations like Oldsmobile, Cadillac, Cartercar, Elmore, Ewing, Pontiac and so on. Durant lost control of GM in 1910 to a financiers trust, because of the huge measure of obligation (around $1 million) taken on in its acquisitions. Durant left the firm and helped to establish the Chevrolet Motor Company in 1911 with Louis Chevrolet. After a splendid stock repurchase battle, he came back to head GM in 1916. GM outperformed Ford Motor Company in deals in the late 1920s gratitude to the initiative of Alfred P. Sloan. Sloan was imagining better approaches for dealing with a complex overall association, while giving uncommon consideration to customer requests. Vehicle purchasers not, at this point needed the least expensive and most fundamental model; they needed style, force, and esteem, which GM offered them. During the 1920s and 1930s, General Motors expected control of the Yellow Coach transport organization, and made Greyhound transport lines. They supplanted intercity train transport with transports. GM needs a need to keep moving with respect to overhauling a key arrangement that joins the up and coming age of vehicles. In today’s worldwide economy and exceptionally serious automobile industry GM has no an ideal opportunity to delay. As expressed, GM has quite recently a lot in danger in not turning into an industry chief in elective fuel innovation. Efficiency enactment is starting the race. This is a crucial time in automobile industry with numerous dangers, however open doors too. The following quite a long while will reclassify GM. Vision Statement The GM vision is as per the following: GM’s vision is to be the world head in transportation items and related administrations. GM will win our customers’ eagerness through nonstop improvement driven by the respectability, cooperation, and advancement of GM individuals. The proposed new vision for GM is as per the following: For GM to turn into the car business pioneer in elective powered vehicles and giving unrivaled quality items that worldwide customers bring to mind when they consider quality and advancement. My vision for GM is to be the business chief in development, and where all other industry rivalry endeavors to copy. Statement of purpose The present GM statements of purpose are as per the following: Drive enhancements in piece of the overall industry, income, brands, individuals, responsiveness, and cost viability through the usage of worldwide regular measurements and best work on sharing. The new proposed statement of purpose will be as per the following: GM will turn into an industry head, not an adherent. To recapture lost piece of the pie that was lost to remote rivalry, and indeed be the vehicle business pioneer in deals and piece of the pie in today’s worldwide market. Qualities Statement The automobile business simply like the worldwide economy is experiencing gigantic change, because of rising fuel costs, and natural concerns, for example, an Earth-wide temperature boost. GM must utilize these dangers as circumstances, and exploit changing customer purchasing propensities. GM needs to change shopper impression of the organization, from a dull, low quality, vehicles to inventive, quality, and ecologically agreeable organization. To do this GM must depict a picture that expresses that GM esteems what the buyer needs and what nature needs. Tune in to what shoppers are stating straightforwardly and in a roundabout way about GM’s current items, and make imaginative, green, vehicles that transform buyers into clients. Simultaneously give GM partners pride and money related motivators to stay with GM. Ecological Analysis GM and the whole car industry are as of now tested with the ideal tempest. The car business is being hit by a powerless US and worldwide economy, rising fuel costs, and social and political natural concerns and issues. So as to defeat these potential danger, GM ought to consider mass delivering a scope of option powered vehicles, I. e. energy unit, electric, and half breed. SWOT Analysis Strengths 1. Enormous Market Share Although GM’s piece of the pie in the US has dropped it is still especially serious at 26 percent. They additionally have an expanding share in the Chinese market. With the correct choices there is no explanation behind GM to not turn into the car head it used to be. . Worldwide Experience As clarified above even with GM’s ongoing decay they despite everything have the piece of the pie and the experience to bob back. They have been an overall organization for almost a century now and have set up themselves as the worldwide pioneer for the vast majority of them. On the off chance that you review I referenced over that a presen t open door for GM is to extend internationally and as should be obvious they as of now have the experience to do as such. It is simply an issue of the right arranging and appropriate execution of those plans that will chose whether or not GM’s objectives are accomplished. 3. Assortment of Brand Names GM as I referenced has been the car head for most of the only remaining century. An enormous explanation behind that is the wide assortment of value brand names that intrigue to all objective markets. The present GM brands include: Chevrolet, GMC, Cadillac, Buick, Pontiac, Saturn, Hummer, Saab, Daewoo, Opel, and Holden. 4. GMAC Customer Financing Program Since its foundation in 1919 it has demonstrated to be GM’s most dependable wellspring of income. 5. OnStar Satellite Technology Developed in 1996 OnStar right now has more than 3 million supporters and is standard on all GM vehicles. This innovation permits the vehicles to be followed in case of a crisis or burglary. It additionally permits the driver as well as travelers the capacity to speak with OnStar work force at the snap of a catch. Shortcomings 1. Behind on Alternative Energy Movement This is GM’s greatest shortcoming. The elective vitality/cross breed pattern has started to occur in the car business and GM has been one stage behind the opposition regarding elective vitality vehicles. This has prompted numerous issues remembering loss of piece of the overall industry and a diminishing for organization benefit. All together for any car organization to be effective starting now and into the foreseeable future they should be Hybrid inviting and eco-friendly. 2. Poor Organizational Structure As we can find in display 1 of the case GM’s hierarchical structure is by all accounts excessively vertically incorporated. This causes an absence of correspondence between representatives start to finish and may have had an influence in GM falling behind on the elective vitality development. 3. Stale Profitability Looking at GM’s benefit we see that they are surely battling regarding the size of their organization. Their net revenue was around 1. 5% and the ROE has drastically diminished over the ongoing years dropping to 10% in 2004. This is a circumstance that investors won't be satisfied with. 4. Excessively Dependent on US advertise GM has gotten excessively subject to the US showcase and must make the most of the chance to extend all inclusive. The opposition is getting too solid to even consider focusing on only one nation. 5. Excessively Dependent on General Motors Acceptance Corporation(GMAC) Financing GM has gotten excessively subject to its financing program. Conceded it is an extraordinary quality for GM, anyway they by and by can't depend exclusively on financing so as to turn benefit, particularly on the off chance that they need to rival Honda and Toyota who are quickly developing. 6. Poor Credit Status GM’s credit status has like everything else has been consistently declining. Their present proportion is marginally over 1 and their basic analysis is even lower. In spite of the fact that, I don’t see them getting denied dependent on their credit now, the reality of the issue is surely evident. Openings 1. Elective Energy development Clearly GM was behind its opposition with respect to the innovative work of mixture vehicles. Anyway cross breed innovation is still especially new allowing GM the chance to by and by become the car industry’s pioneer in development and innovation. 2. Proceeding to Expand Globally. As of late GM saw an expansion in the Chinese car showcase, which demonstrates their should be more accentuation put on remote markets. On the off chance that GM can invade these business sectors and effectively develop alongside their proceeding with center around the US showcase they will be going a positive way. . Low Interest Rates With the correct advertising system the low loan costs can possibly produce a prompt increment in deals. 4. Grow New Vehicle Styles and Models This is an open door that will never be fulfilled, implying that GM ought to consistently be endeavoring to build up the car world’s most mainstream vehicles, and as we probably am aware, what is in today will be out tom orrow. Dangers 1. Rising Fuel Prices With GM being a huge maker in the two trucks and SUV’s, deals have radically diminished because of the absence of eco-friendliness. The ascent in fuel costs has assumed a critical job in making the open door for advancement of both cross breed and more eco-friendly vehicles. As you will discover with most dangers, an equivalent open door will typically rise just like the case here with GM’s opportunity referenced previously. 2. Development of Competitors GM no longer has the advantage of being the known pioneer in the car business and countenances the truth that

Shrub Summary essays

Bush Summary expositions In Molly Ivins and Lou Duboses analysis, Shrub, the creator plots George W. Bushs political life from his days as an oil business visionary in Midland, working for partnerships, and turning into the legislative head of Texas. The general reason for Molly Ivins is to give the future president a foundation of what he has done in Texas that would make it unnerving to the following head of the free world. In the presentation, Ivins proposes, The first is to take a gander at the record. The second is to take a gander at the record. Also, third, take a gander at the record. One of the primary responsible and strange records was when Bush had the option to fly F-102s in the Texas Air National Guard. He was appointed to one of the most secure plane missions to hinder himself from going to Vietnam. In contrast to a portion of the poor youngsters and with the improvement of Project 100,000 to acknowledge Southern dark kids to take an interest in the war, the amazing and well off individuals in the province of Texas kept the rich youthful guys from going to Vietnam. Notwithstanding Bushs most reduced score on the pilots test, he was chosen from 150 out of a holding up rundown of 100,000 individuals going after the job. Nonetheless, in spite of the base scores, junior utilized the name Bush successfully on the grounds that his dad was a Congressman for Texas. Bramble Jr. likewise ran for Texas Congressional seat. In any case, all plans were broken after one of his volunteers, goofed up by running a Bush Bash political meeting. The slam was to welcome understudies at Texas Tech to decide in favor of Bush by parting with free mixed drinks. George W. Shrubbery was engaged with oil business in Texas. Molly Ivins summarizes what Mr. Shrubbery has done, he had really fizzled, yet at the same time compensated for the slip-ups he has submitted. For instance, when Bush struck oil and established Arbusto Energy Company, he had around fifty speculators put in $4.7 million, yet lost the vast majority of the sum. The organization was spared Spectrum 7 Energy Corpor... <!

Wireless Metropolitan Area Networks †Free Samples to Students

Question: Talk about the Wireless Metropolitan Area Networks. Answer: Presentation Remote metropolitan region systems (WMANs) which permits clients to recognize remote systems between a few zones in a city. WMAN can be utilized in situations where wired system become inaccessible. WMANs can use advancements, for example, microwave, millimeter wave, broadband radio, free space and Wi-Fi Hotspots. (Burbank, 2013). This innovation covers significant distance, committed data transmission and high limit. Its connections incorporate full indoor, full outside, communicate connections and split mount to meet the distinctive customer requirements for metropolitan scale microwave systems (Westcott Coleman, 2015). Cost: introductory expense is moderately lower as in different advances in light of the fact that no physical parts are required. Information limit: 400(364) Mbps and 800(728) Mbps for High execution microwave radios Offers up to and 1.6Gbps and higher up to 3Gbps for full duplex payload. Administration Area: up to range of 100km Establishment speed: quicker to set up Security: Subject to Electromagnetic and Other Interference Millimeter Wave (MMW) Gives somewhere in the range of 100mbps and 2.5 Gbps transmission capacity in 60-90 GHz in TodaysMillimeter Wave (MMW) items offers 100Mbps up to 2.5 Gbps throughput in 60-90GHz territory. It is a remote transmission innovation with extremely quick point to point associations. In metropolitan territories with blocked frequencies it gives fast associations (In Kim In Joukov, 2017). Cost: Relatively greater expense than microwave Information limit: 100Mbps to 2.5 Gbps Administration Area: up to sweep of 20km Establishment speed: more slow than microwave Security: Better security and protection contrasted with microwave MIMO OFDM Broadband Radio This innovation works on lower frequencies in the 2-6GHz to offer point to multipoint or highlight point associations. Current innovation furnishes bearer class broadband radio gadgets with limit of 867Mbps in either unlicensed or authorized groups. Broadly utilized in remote ISP, business undertakings, CCTV applications and governments. Symmetrical Frequency Division Multiplexing (OFDM) is an innovation which tends to the issue of sign skipping and permits Non-view broadcasting however structures, trees and different structures. It very well may be conveyed in structures like star, transport, work ring among others. MIMO innovation uses a few dimensional streams on comparable recurrence to support paces of information 2-4 times speed of non-MIMO gadgets (Angelescu, 2010). Cost: introductory expense moderately high contrasted with different innovations. Information limit: up to 867Mbps Administration Area: up to range of 20km Establishment speed: takes moderately a more extended time Security: Better security and protection contrasted with microwave Free Space Optics This innovation depends on optical correspondence that utilizations changed light to spread information broadcasting through the environment remotely. This varies from fiber optic which uses guided media, for example, fiber to transmit optical signs. This innovation uses infrared light either LED or laser hardware. Free Space Optics regularly utilizes transmission in the infrared groups utilizing either Laser or LED gadgets. It offers high paces of information, unrivaled shaft collimation and high force yield. Contrasted with microwave and Millimeter waves, it doesn't experience the ill effects of weakening. Influenced by climatically conditions, for example, dust tempests, day off thick haze which cutoff points interface unwavering quality between 1-4km relying upon area. Spreads association up to 4km and limit of up to 1.5Gbps (Burbank, 2013). Cost: low beginning expense Information limit: up to 1.5Gbps Administration Area: up to range of 4km Establishment speed: straightforward and takes under 60 minutes Security: view tasks makes its a protected framework. Proposal Therefore,if ZeeTech is thinking about executing a WMAN innovation at that point microwave is the best. This is on the grounds that it is moderately less expensive to introduce contrasted with different innovations, higher transmission capacity, huge inclusion zone and simplicity of establishment. This will interface every one of its workplaces across Melbourne just as give versatile remote access to the field laborers that need to go between various locales in a city. Reference Westcott, D. A., Coleman, D. D. (2015).CWNA confirmed remote system manager. Indianapolis, Indiana : John Wiley Sons In Kim, K. J., In Joukov, N. (2017).Mobile and remote advancements. Singapore : Springer. Angelescu, S. (2010).CCNA accreditation across the board for fakers. Hoboken, N.J: Wiley. Burbank, J. L. (2013).Wireless systems administration: Understanding internetworking challenges. Hoboken, NJ: John Wiley.

The relative valuation model Essay Example

The relative valuation model Essay The motivation behind this report is to embrace a firm valuation for Woolworths, utilizing limited income model and the relative valuation model. This report gives data got through a direct of Free Cash Flow to Firm Discount Valuation Model for Woolworths Limited (WOW), assessing the firm’s current offer worth. The report will at that point recognize 3 key drivers of the firm’s esteem in this model; tests are acted in the report to distinguish the affectability of offer an incentive in the model to changes in explicit factors. In the second segment of this report, organizations, with comparative beta and Earnings per Share Growth as Woolworths’, are dissected and looked at, utilizing Relative Valuation as another valuation technique to evaluate the WOW’s current worth. At long last, this report will direct a relapse examination to legitimize the outcome accomplished in the Relative Valuation. About Woolworths Limited is the biggest food retailer in Australia with head tasks in markets inside Australia and in New Zealand. WOW and its fundamental adversary, COLES Supermarket, take up around 79% of the all out basic food item showcase. WOW additionally has different tasks, which incorporate alcohol, petroleum, general product and customer gadgets. Woolworths has a market capitalisation of $29,927 million, its offers are as of now exchanging at $24. 63 for every offer. (Market Cap and offer cost are obtained from FinAnalysis on 16 September 2011) Discounted Cash Flow Valuation Model (DCF) Discounted Cash Flow Valuation Model is utilized to assess the potential for venture by limiting back the firm’s future free incomes. The DCF model utilized in this report is Free Cash Flow to Equity Valuation Model (FCFE). We will compose a custom article test on The relative valuation model explicitly for you for just $16.38 $13.9/page Request now We will compose a custom exposition test on The relative valuation model explicitly for you FOR ONLY $16.38 $13.9/page Recruit Writer We will compose a custom exposition test on The relative valuation model explicitly for you FOR ONLY $16.38 $13.9/page Recruit Writer Hazard free rate: 3. 64%. The Australia 3-Year Government Bond yield on 16 September 2011 is utilized as an intermediary for the hazard free rate for this valuation. Right off the bat, Australia has SP most elevated FICO score of AAA, likewise a Fitch FICO assessment of AA+. These appraisals signify desires for Australia having low to least default chance, solid to uncommonly solid limit with respect to installment of money related responsibilities, where this limit isn't fundamentally to exceptionally far-fetched defenseless against predictable occasions. Besides, utilizing Australian-dollar-signified rate is a simpler methodology than utilizing USD-meant rate, where suspicions, for, for example, trade rates, may go amiss the valuation result from the genuine worth. In this manner, we accept this is an equivalent figure to speak to the arrival requested from a hypothetically outright hazard free venture over this valuation period. Turned Beta: 0. 71 all through the 3-year high development period. This is found on FinAnalysis on 16 September 2011. It was determined by altering the industry’s beta dependent on WOW’s money related influence. For stable development period, ? =0. 8 is picked, as WOW’s beta will way to deal with one when the firm is drawing closer to stable stage, which recognizes the expanded security of WOW before the finish of the high development time frame. Value affectability to change in stable development rate, first key driver of the firm worth: One of the key drivers of the firm worth is the suspicion for the steady development rate. In our underlying valuation, we expect that the firm’s stable development rate will be drawing closer to Australian GDP development rate as the firm accomplishes security. As introduced, the evaluated share estimation of WOW will increment as the steady development rate increments. Value affectability to change in cost of value during stable development stage, second key driver of the firm worth: Another key driver of the incentive during the time spent valuation is the expense of value during stable development stage. We at first accepted that the expense of value will be 7. 64% as the beta of the firm will move towards one when the firm methodologies strength. The evaluated share cost of the firm will diminish as the expense of value during stable development increments. Value affectability to change long of high development, third key driver of the firm worth: In the last situation, the suspicion of length of high development period has transformed from the underlying 3 years to 5 years. This could occur because of the ongoing money related breakdown, which would fundamentally hinder the development of the firm. Should 5-year high development be utilized, Australian 5-Year Government Bond pace of 3. 81% is picked as the hazard free rate for the model, because of which, the Cost of Equity during high development and stable development stages will change as introduced beneath. Different components remain steady, the assessed share cost of WOW will be $26. 80, under which conditions, the firm is underestimated given the present offer cost is $24. 63 on 16 September 2011. PS proportion is accepted to be consistently estimated as every single money related figure for the practically identical firms are gotten from the current monetary year at FinAnalysis. As these practically identical firms are from various markets that have diverse bookkeeping rules, Price to Sales (PS) proportion is picked as the numerous to assess these equivalent firms. Other than that, a comparable money related influence over these similar firms gives us a greater amount of the motivation to utilize PS proportion as the numerous.

Weed Concerning to College Athletes - Free Essay Example

The question of college athletes using marijuana in college has stirred up a great controversy in todays society. The topic is controversial because in some states the drug is legal, but it is still illegal at the federal level. It also is said to give athletes some benefits and non-benefits that can affect the athlete. The main reason why college athletes arent allowed to use marijuana is because even though weed is legal at the state level, it is not legal at a federal level. This means if the federal government wants to hold charges against a college for allowing their athletes to use marijuana, there can be serious consequences and ramification for that college. This scare and discourages a lot of colleges, athletic programs, from promoting use of the drug, because most colleges receive a substantial amount government funding, which would be in jeopardy, if they allowed marijuana use. There can be various consequences for marijuana use, such as a college athlete losing their scholarship or the chance to play college sports period. Using marijuana, as an athlete, is something you dont want to play with if youre dream is to (one day) make it into the big league. Some people say marijuana should be allowed for college athletes because of the benefits. Some of the many benefit that marijuana can give an athlete is muscle relaxation, which can help athletes recover from workouts quicker allowing them to work out more often. Marijuana also can help an athlete gain weight if needed. Marijuana also can be used as a pain reliever/softener if an athlete was injured. Its also said to protect the brain from concussions and trauma. Meaning it can help football players sustain hits to the head more often. The drug also can help the student athletes cope with depression and anxieties to help them become focused in their studies and sports. Marijuana also can stop muscle spasms and cramps that occur during competition and working out. It is said that marijuana can also stop headaches caused from strenuous workouts. The drug can also help with responses allowing you to do things quicker and more efficient. It also allows an athlete to get better sleep whic h can improve energy and recovery of the body. Marijuana is said to improve vision and concentration allowing athletes to focused in on the game. It also allows athletes to forget previous traumatic experiences related to the activity such as hits, falls and injuries. Marijuana is also said to make people happier in which athletes will begin to have fun with the sport instead of being stressed about it. It is a fact that marijuana doesnt have to be just smoked to gain some of the same benefits. Marijuana come in many different forms liquid and edibles that will give you the same effects without the pressure of causing harm to the lungs. Meaning that you dont get the disadvantages of the smoke such as the smell and the long-term effect on the lungs. These advantage alone can give an athlete an upper hand over others when it comes to competing and getting better at their sport. Many argue that Marijuana should not be allowed for college athletes because of the non-benefits. Many people believe that the drug doesnt give an athlete the upper-hand but it takes away from the athlete ability by taking away their time and education readiness to be eligible to play, which give them a disadvantage at the start. They say things like the drug is addictive and can cause athletes to spend most of their time getting high. Its also said the that the drug can kill brain cells and make an athlete not as smart making them unable to pass classes to be eligible to play. The National Institute on Drug Abuse states that 9 percent of all user of marijuana will become dependent, whereas 17 percent of people who start using during their teens are more likely to be dependent on it. One study conducted by the journal Drug and Alcohol Dependence in 2011, said that 42 percent of users who tried to quit experienced withdrawal symptoms, such as a loss of appetite and increased levels of irritation. The THC in the weed could mess with your balance if too much is consumed at once, can cause one to stumble and fall. Marijuana can also cause psychosis, if too much is consumed, causing people to hallucinations, to be delusional, and to their sense of personal identity. If too much THC is consumed it can also cause dizziness or lightheadedness. Also, the smoke in weed can make you develop a chronic cough or a respiratory illness, due to the weed smoke. The smoke in weed can lead to a medical condition called Cannabinoid Hyperemesis that can lead to nausea and vomiting. These disadvantages can harm an athlete and cause them to their skills in their sport. The question of college athletes using marijuana in college has stirred up a big controversy in todays times. Its controversies include both state and federal legal oppositions, as well as the many pros and cons on the effect that marijuana has on an athlete. Overall, both arguments give great examples on, whether or whether not, marijuana should be used by college athletes. However, the big question remains, should or shouldnt college athlete use marijuana? The verdict is still out!

What Are Interest Rates Finance Essay - Free Essay Example

An interest rate is the rate at which interest is paid by a borrower for the use of money that they borrow from a lender. Interests rates are fundamental to a capitalist society. Interest rates are normally expressed as a percentage rate over the period of one year. Interest rates are also a tool of monetary policy and are taken into account when dealing with variables like investment, inflation, and unemployment. In traditional actuarial investigations, the interest rate is assumed to be deterministic and hence there is only one source of uncertainty, the mortality uncertainty, to be considered. Concerns about the effects of including a stochastic interest rate in the model have been growing during the last decade. The literature has tended to focus on annuities and the model adopted to describe the interest rate uncertainty, in a continuous framework, has usually involved the use of a Brownian motion (Beekman and Fuelling,1990- 1991), (Dufresne, 1990), (De Schepper et a l, 1992), (Parker, 1994), (Perry and Stadje, 2001), (Perry et al, 2003). When the market rates are high, volatility is expected to be high or when interest rates are low, volatility will be low. (Brennan Schwartz, 1980; Chan et al., 1992; Cox et al., 1985; Nowman, 1997; NowmanStaikouras, 1998) A derivative which has as an underlie the ability to pay or receive a given amount of money at a given interest rate. Interest rate derivatives are the most popular kind of derivative, and include interest rate swaps and forex swaps. Features of interest rate swaps and forex swaps are swap of fixed-for-floating interest rate, a master agreement for fixed rate interest, a floating or variable rate which is reset periodically, a set-off exercise at every reset time to swap a fixed-for-floating interest rate and floating interest rate is to based on a certain benchmark (Dr. Mohd Daud Bakar, 1971) Interest rate swaps is an exchange of interest payments on a specific principal amount. This i s a counterparty agreement, and so can be standardized to the requirements of the parties involved. An interest rate swap usually involves just two parties, but occasionally involves more. Often, an interest rate swap involves exchanging a fixed amount per payment period for a payment that is not fixed (the floating side of the swap would usually be linked to another interest rate, often the LIBOR) an interest rate swap, the principal amount is never exchanged; it is just a notional principal amount (D. K. MalhotraIn, 1998). Background research Richard J. Rendleman, Jr. (1949) is a composer whose works have been performed by The North Carolina Symphony, The South Carolina Philharmonic Orchestra, The United States Navy Band and a number of other orchestras, chamber groups and choral ensembles. His compositions have been recorded by the Seattle Symphony, The Warsaw National Philharmonic, The Czech National Symphony, The Slovak Radio Orchestra and the St. Stephens Chamber Orchest ra. Rendleman is also Professor of Finance at the Kenan-Flagler Business School of the University of North Carolina at Chapel Hill. Rendleman married Nancy Sherwin in 1974, received his Ph.D. from UNC in 1976, and taught at Northwestern University before moving back to his home state to take a teaching position at Dukes Fuqua School of Business. Although his academic career was moving along Rendleman still couldnt shake his desire to make something happen with his music. (Melinda S. Stubbee, 1996) Rendleman began composition studies with Robert Ward, and for the first few years thereafter composed mainly for piano in 1981. Later, his compositions expanded into chamber, vocal and orchestral works. Prior to studying with Ward, Rendlemans music training consisted of five years of piano lessons as a young child followed by four years of junior high and high school band. Some of Rendlemans earliest compositions were instrumental pieces written in 1966-1967 for Rhythm and Blues band , Soul Inc., known by many in the Salisbury, North Carolina area as Carolinas Finest Show and Dance Ensemble. Rendleman is also Professor of Finance at the Kenan-Flagler Business School of the University of North Carolina at Chapel Hill. He is best known for his work in derivative securities markets, particularly implied volatility and two-state (or binomial) option pricing and for his work on the relationship between stock returns and quarterly earnings surprises. For better or worse, his work on earnings surprises in the early to mid 1980s has contributed significantly to Wall Streets sensitivity to quarterly earnings during the 1990s ( Richard Rendleman, 2009) Literature Review The literature review is based on a Rendleman Bartter model developed by Yeliz Yolcu [2005]. Rendleman bartter models are the first short rate models being proposed in the financial literature. As they said before, drift and diffusion terms contain constant parameters. Moreover, they produce an endog enous term structure (current term structure of rates is an output rather than an input of the model) of interest rates in that initial term structure of rates need not to match the observed market data no matter how the parameters are chosen. Rendleman-Bartter model (1980) formulate as drt = rtdt + rtdWt; where; are nonnegative constants.When they look at roughly, we think that Dothan and Rendleman-Bartter have the same formulation. However, in the original paper of Dothan he aimed to present a valuation formula for default free bonds for a certain class of tastes when the rate follows a geometric Wiener process and so he started with his work by the above formulation (3.1.10) under the objective probability. Since, they are dealing with the risk neutral valuation, they change directly this formulation to risk neutral framework. Moreover, without doubt the analytic expression of this model is the same as that Dothan Model. Indeed, they will give the intuition of constructing this k ind of model. Rendleman and Bartter assume that the short-term interest rate behaves like a stock price less than ideal. One important difference between the stock price and and interest rate is interest rate appeared to be pulled back to some long run average level over time (mean reversion) due to economic facts. (Rogers, 1995) Unlike Vasicek, they do not corporate with the mean reversion. Michael D. Goldberg [2000] The simplest models of the short-term interest rate are those in which the interest rate follows arithmetic or geometric Brownian motion. For example, they could write dr = adt + ÃÆ' Ãƒâ€ Ã¢â‚¬â„¢dZ (24.23).In this specification, the short-rate is normally distributed with mean r0 + at and variance ÃÆ' Ãƒâ€ Ã¢â‚¬â„¢2t. There are several objections to this model. First, the short-rate can be negative. It is not reasonable to think the nominal short rate can be negative, since if it were, investors would prefer holding cash under a mattress to holding bonds. Second, the drift in the short-rate is constant. If a 0, for example, the short-rate will drift up over time forever. In practice if the short-rate rises, they expect it to fall; example, it is mean-reverting. Thirdly, the volatility of the short-rate is the same whether the rate is high or low. In practice, they expect the short-rate to be more volatile if rates are high. Rendleman and Bartter model, by contrast assumes that the short-rate follows geometric Brownian motion: dr = ardt + ÃÆ' Ãƒâ€ Ã¢â‚¬â„¢rdz (24.24) While interest rates can never be negative in this model, one objection to equation (24.24) is that interest rates can be arbitrarily high. In practice they would expect rates to exhibit mean reversion; if rates are high, they expect them on average to decrease. The Rendleman-Bartter model, on the other hand, says that the probability of rates going up or down is the same whether rates are 100% or 1%. In the Rendleman-Bartter model, interest rates could not be neg ative because both the mean and variance in that model are proportional to the level of the interest rate. Thus, as the short-rate approaches zero, both the mean and variance also approach zero and it is never possible for the rate to fall below zero (Richard J. Rendleman, Jr., 1980). In the Vasicek model, by contrast, rates can become negative because the variance does not vanish as r approaches zero (Oldrich Vasicek, 1977). Professor Landsman reviews research on both the relevance and reliability of reporting fair values for loans and other financial instruments (Landsman, 2005). Accounting standard setters define fair value as the amount that would be paid or received for the item being valued in an arms length transaction between knowledgeable parties (FASB, 2004a). This is a market value definition and the standard setters have indicated that, if available, a current market price for the item is said to be the best estimate of its fair value. Relevance means that the fair va lue is capable of making a difference to financial statement users decisions. Reliability means that the reported fair value represents what it is purported to represent (Barth et al, 2001). Professor Landsman concludes that the evidence on fair value reporting supports its relevance. On reliability, he suggests there is some uncertainty, using evidence from Barth, Landsman, and Rendleman (1998) based on testing a pricing model for corporate bonds. He further discusses banks use of their private information in determining loan fair values and consequences of model valuation errors on earnings volatility. Short Title: Rendleman-Bartter Model In the context of finance the The Rendleman-Bartter model is a very important theory. The Rendleman-Bartter Model could be called a short rate model. This model deals with rates of interest. The Rendleman-Bartter Model tries to explain the growth of rates of interest and is among the earliest models that dealt with rates of interest for a s horter period of time. It applied the random process that had been used to explain the movements of the basic prices of stock options. According to the model, the instantaneous rate of interest changes in accordance with the geometric Brownian motion, which is also called the exponential Brownian motion. The geometric Brownian motion is an uninterrupted random process. In the Rendleman-Bartter Model, market risk is the sole factor that is responsible for the changes in the rates of interest. This is why the Rendleman-Bartter Model could also be called a kind of one factor model In this model Wt is nothing but a Wiener process. It models the risk factor involved in random markets. ÃÆ' Ãƒâ€ Ã¢â‚¬â„¢ is the drift parameter of the Rendleman-Bartter model. ÃÆ'Ã… ½Ãƒâ€šÃ‚ ¸ is the standard deviation parameter of the Rendleman-Bartter model. The drift parameter of the Rendleman-Bartter model stands for the extent of fluctuation in the rate of interest. This rate is normally fixed, anticipated and instantaneous. The standard deviation parameter of the Rendleman-Bartter model ascertains the unpredictability of rates of interest. (Richard  J Rendleman and Brit  J Bartter,1979) Market risk is the risk that the value of a portfolio, either an investment portfolio or a trading portfolio, will decrease due to the change in value of the market risk factors. The four standard market risk factors are stock prices, interest rates, foreign exchange rates, and commodity prices. The associated market risk are equity risk, interest rate risk, currency risk and commodity risk (Y Amihud, 1992). Equity risk is the risk that ones investments will depreciate because of stock market dynamics causing one to lose money. The measuring of risk used in the equity markets is typically the standard deviation of a securitys price over a number of periods. The standard deviation will delineate the normal fluctuations one can expect in that particular security above and below the mean, or average. However, since most investors would not consider fluctuations above the average return as risk, some economists prefer other means of measuring it (E Dimson, 2002). Interest rate risk is the risk borne by an interest-bearing asset, such as a loan or a bond, due to variability of interest rates. In general, as rates rise, the price of a fixed rate bond will fall, and vice versa. Interest rate risk is commonly measured by the bonds duration. Asset liability management is a common name for the complete set of techniques used to manage risk within a general enterprise risk management framework (George J. Hall, Thomas J. Sargent, 2010). Currency risk is a kind of risk that arises from the change in price of one currency against another. Whenever investors or companies have assets or business operations across national borders, they face currency risk if their positions are not hedged. Transaction risk is the risk that exchange rates will change unfavora bly over time. It can be hedged against using forward currency contracts. Translation risk is an accounting risk, proportional to the amount of assets held in foreign currencies. Changes in the exchange rate over time will render a report inaccurate, and so assets are usually balanced by borrowings in that currency. The exchange risk associated with a foreign denominated instrument is a key element in foreign investment. This risk flows from differential monetary policy and growth in real productivity, which results in differential inflation rates (Gunther Schnabl, 2006). Commodity risk refers to the uncertainties of future market values and of the size of the future income, caused by the fluctuation in the prices of commodities. These commodities may be grains, metals, gas, electricity etc. A commodity enterprise needs to deal with price risk, quantity risk, cost risk, political risk (DF Larson, 1998). The Wiener process in mathematics a continuous-time stochastic process nam ed in honor of Norbert Wiener. It is often called Brownian motion, after Robert Brown. It is one of the best known Levy processes (cadlag stochastic processes with stationary independent increments) and occurs frequently in pure and applied mathematics, economics and physics. The Wiener process plays an important role both in pure and applied mathematics. In pure mathematics, the Wiener process gave rise to the study of continuous time martingales. It is a key process in terms of which more complicated stochastic processes can be described. As such, it plays a vital role in stochastic calculus, diffusion processes and even potential theory. It is the driving process of Schramm-Loewner evolution. In applied mathematics, the Wiener process is used to represent the integral of a Gaussian white noise process, and so is useful as a model of noise in electronics engineering, instrument errors in filtering theory and unknown forces in control theory (N Dohi, 1993). The Wiener process has applications throughout the mathematical sciences. In physics it is used to study Brownian motion, the diffusion of minute particles suspended in fluid, and other types of diffusion via the Fokker-Planck and Langevin equations. It also forms the basis for the rigorous path integral formulation of quantum mechanics (by the Feynman-Kac formula, a solution to the Schrodinger equation can be represented in terms of the Wiener process) and the study of eternal inflation in physical cosmology. It is also prominent in the mathematical theory of finance, in particular the Black-Scholes option pricing model (MJ Hinich, 2010). The limitation of Rendleman-Bartter Model The assumption that the short-term interest rate behaves like a stock price is a natural starting point but it is less than ideal. One important difference between interest rates and stock price is that interest rates appear to be pulled back to some long-run level over time. This phenomenon is known as mean reversion . When r is high, mean reversion tends to cause it to have a positive drift. The Rendleman and Bartter model does not incorporate mean reversion. There are compelling economic arguments in favour of mean reversion. Hen rates are high, the economy tends to slow down and there is low demand for funds from borrowers. As a result, rates decline. When rates are low, there tends to be a high demands for funds on the part for borrowers and rates tend to rise (Y YOLCU, 2005). Other examples of short-rate model 1. Particular short-rate models Vasicek model Vasicek model is a mathematical model describing the evolution of interest rates. It is a one type of one-factor model as it describes interest rate movements as driven by only one source of market risk. The model can be used in the valuation of interest rate derivatives, and has also been adapted for credit markets, although its use in the credit market is in principle wrong, implying negative probabilities (Oldrich Vasicek, 1 977). Ho-Lee model Ho-Lee model is a short rate model to predict future interest rates. It is the simplest model that can be calibrated to market data, by implying the form of ÃÆ'Ã… ½Ãƒâ€šÃ‚ ¸t from market prices. Ho and Lee does not allow for mean reversion (T.S.Y. Ho, S.B. Lee, 1986). Hull-White model In financial mathematics, Hull-White model,which also called the extended Vasicek model is a model of future interest rates. In its most generic formulation, it belongs to the class of no-arbitrage models that are able to fit todays term structure of interest rates. It is relatively straight-forward to translate the mathematical description of the evolution of future interest rates onto a tree or lattice and so interest rate derivatives such as bermudan swaptions can be valued in the model. The model is still popular in the market today (John C. Hull, Alan White, 1990). Cox-Ingersoll-Ross model In mathematical finance, the Cox-Ingersoll-Ross model (or CIR model) de scribes the evolution of interest rates. It is a kind of one factor model and short rate model as it describes interest rate movements as driven by only one source of market risk. The model can be used in the valuation of interest rate derivatives. It was as an extension of the Vasicek model (John C. Cox, Jonathan E. Ingersoll, Stephen A. Ross, 1985). Black-Karasinski model In financial mathematics, the Black-Karasinski model is a mathematical model of the term structure of interest rates. It is a one-factor model as it describes interest rate movements as driven by a single source of randomness. It belongs to the class of no-arbitrage models, i.e. it can fit todays zero coupon bond prices, and in its most general form, todays prices for a set of caps, floors or European swaptions ( Fischer Black, Piotr Karasinski, 1991). Black-Derman-Toy model Black-Derman-Toy model (BDT) is a popular short rate model. It is a one-factor model, that is, a single stochastic factor the s hort rate determines the future evolution of all interest rates. It was the first model to combine the mean-reverting behaviour of the short rate with the lognormal distribution, and is still widely used. It was first developed for in-house use by Goldman Sachs in the 1980s and was published in the Financial Analysts Journal in 1990. A personal account of the development of the model is provided in one of the chapters in Emanuel Dermans memoir My Life as a Quant. Under BDT, using a binomial lattice one calibrates the model parameters to fit both the current term structure of interest rates (yield curve), and the volatility structure for interest rate caps (usually as implied by the Black-76-prices for each component caplet). Using the calibrated lattice one can then value a variety of more complex interest-rate sensitive securities and IRDs ( Fischer Black, Emanuel Derman, Bill Toy, 1980). 2. Multi-factor short-rate models Longstaff-Schwartz model Longstaff-Schwartz model is a two-factor model of the term structure of interest rates. It produces a closed-form solution for the price of zero coupon bonds and a quasi-closed-form solution for options on zero coupon bonds. The model is developed in a Cox-Ingersoll-Ross framework with short interest rates and their volatility as the two sources of uncertainty in the equation (Longstaff, Francis and Eduardo Schwartz , 1992). Chen model The Chen model is a mathematical model describing the evolution of interest rates. It is a type of three-factor model of short rate model as it describes interest rate movements as driven by three sources of market risk. It was the first stochastic mean and stochastic volatility. In an authoritative review of modern finance, Chen model is listed as a major term structure model. Different variants of Chen model are still being used in financial institutions worldwide. James and Webber devote a section to discuss Chen model in their book; Gibson et al. devote a section to cover Chen model in their review article. Andersen et al. devote a paper to study and extend Chen model. Gallant et al. devote a paper to test Chen model and other models; Cai devotes her PhD dissertation to test Chen model and other competing models (Lin Chen, 1994). Conclusion The Rendleman-Bartter model for pricing interest rate options makes the assumption that the probability distribution of an interest rate, a bond price, or some other variable at a future point in time is lognormal. They are widely used for valuing instruments such as caps, European bond option, and European swap option. The Rendleman-Bartter Model is analytically tractable and relatively simple to implement, however this model has limitation as it does not provide a description of how interest rates evolve through time. Consequently, it cannot be used for valuing interest rate derivatives such as American-style swap option, callable bonds, and structured notes. To overcome the limitation of this model , alternative approaches are build ,such as building of what is known as term structure model. This model describing the evolution of all zero-coupon interest rates. In conclusion, each interest rate modeling approach has its own advantages and disadvantages, selecting the suitable model to be used in each interest rate derivatives in very important as it will bring out different outcome.

Critical Opinion On Critical Thinking - 1401 Words

In our daily lives, we face various challenges that require solutions. Most of the time we are able to solve these problems with minimum effort, at other times, however, the problems may be more complex and solutions to them may not be readily available. This will present us with various challenges and may require us to employ critical thinking. Critical thinking is an important skill burden of responsibility of ensuring the problems of a contemporary society are understood and well interpreted and a solution presented. As long as he or she resides in a contemporary society, he or she, must, therefore, ensure that he or she meets this responsibility. People who engage in critical thinking tend to provide good evidence and reasoning for the opinions they hold. Critical thinking also enables people to provide reasons for their actions. This research paper presents a critical analysis of the importance or the role that critical thinkers play in dealing with societal issues related to fa mily relations and dynamics. Theses issues include, but are not limited to, teen violence, physical abuse, depression, and suicide. The paper tries to define critical thinking and family and then it goes ahead to illustrate how critical thinking can help to solve these problems that surround family relations and dynamics. According to David hunter, although many definitions for critical thinking exist, Robert Ennis’ definition of critical thinking as a reasonable, reflective thinkingShow MoreRelatedCritical Opinion On Critical Thinking1456 Words   |  6 PagesCritical thinking is something I use on a daily basis as a nurse. To think critically, you recognize an issue, collect data, gather information to support it, analyze that data, evaluate it, and decide what to do about it. 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