Cultural and environmental Issues in Pakistan Essay

Corruption is the prime reason behind the economical unstableness. Corruption has spread into the world and has ruined the economy. Pakistan has been ranked at 42nd number among the most corrupt nations of the world. Unemployment: Unemployment is a major social problem caused by poor economical system. Causes of unemployment are: Lack of funds followed by unorganized system and lack of new projects are causing unemployment worldwide. There are many reasons of unemployment like influx of machinery that has replaced manpower. Health problems: Health is another social problem caused by poor economical conditions. The cost of living is ever increasing and shortage of funds is a usual problem worldwide. There are less hospitals and medical centers and if there are any, the people are unable to afford their and their children health  expenses So the health problems grow unchecked. Child labor: Children who deserve to be educated are forced to do work.  The circulation of money is restrained to rich people only causing the poor to become more poor. In past, some countries refused to import those goods from Pakistan in whose making children were employed. Due to growing inflation (rise) and poverty, parents are bound to send their children to work to light their stoves. Economical problems: 1. Power crises 2. War on terrorism 3. Declining export 4. Tumbling stock-market 5. Lack of tourism 6. Loss in business Power crises are affecting the economy of the world very badly. The power crisis is followed by decline in production and at the end the economy of the countries is affected badly. We are running short of fuel worldwide. All the countries are affected by power crises. War against terrorism is another very important reason behind the economical problem.ï‚ § War is affecting the world’s economy and is causing problems like shortage of fuel, lack of funds, increase in health problem etc. War benefits none, someone is hurt badly and someone is destroyed completely. Lack of power followed by decline in production is the main cause of declining export which is a major economical problem worldwide. In Pakistan, core inflation soared to 18.85% in first quarter of year 2009. The production cannot even fulfill the demands and hue to decline in export and lack of trouble, the world economy is suffering great problems. The stock-market is suffering a decline worldwide. Lack of investment and poor economical condition of the people and government is another cause of decline in stock-market worldwide. In 2009, many times Karachi Stock Exchange has plunged to its lowest point in the history of Pakistan. Lack of tourism is also a cause of the declining in economy. Local as well as foreign media has projected Pakistan as a dangerous and unsafe country. Its poor law and order situation has alarmed the tourist and thus Northern areas no more receive many tourists. The poor  economical system affects the business very badly. Foreign investors are not ready to setup their businesses in Pakistan. More than 70 Multinational Companies have already packed up their business from Pakistan. Government as well as every single citizen has to play its own specific role to b ring about a positive change. Cultural crisis in Pakistan A SUFI saint has defined culture as the fragrance left behind when the incense stick of life has burnt out. And, heritage is valued as the highly prized family silver — a loan from our ancestors to be passed on to future generations. No department of life – be it economic, cultural, religious or recreational – has been free from the effect of this great transformation in progress. The old system of classification and stratification of society as a whole is changing gradually and slowly but surely and certainly. We may go for some little changes. For instance, we may change clothing style. We may change our room setting. We may change our eating stuff. We may do whatever makes us happy. Movement is the stuff and essence of life, both for individual and the society. From the independence day of August 14, 1947 up to date, Pakistan’s has been a society in transition. The society of Pakistan is dynamic and therefore ever-changing, and its patterns are changing transforming from time to time. The national society has been responding to the challenges of environment, natural and man-made. The factors and circumstances responsible for these changes can be enumerated as below; partition of sub-continent, technological and scientific inventions, growth of urbanization and industrialization, expansion of commercial activities and international trade, changes in the economic structure of the country initiating the industrialization of its economy, the spread of literacy resulting in the rise of a secular intelligentsia, the effect of the spread of different ideologies of different political parties in the country, the impact of the highly developed countries of the world on our society, the working and influence of the trade union and co-operative movement, the expansion of the area reached by the mass media of communication like radio, press, cinema, television etc. migration and finally cultural diffusion. Changes are the spice of life. Is it true? Of course YES! It is true because everybody needs a change in whatever he/she is doing. We want changes around us. Monotonous life just makes us feel  bored. It is good to have a change. It is not important that we should go for big changes everyday. We may go for little changes that should be pretty affordable. If we are seeking for a healthy and entertaining life then changes are very important. Changes must be positive. If we will go for negative ones then they will obviously have a negative impact upon our lives. Negative impacts are accountable for some more negative changes so we need to be assiduous in this regard. Pakistan today is undergoing an identity crisis a crisis which the author feels arises from culture conflict. One of the causes of this conflict is that the Pakistani society possesses imported cultures along with its own; varying with the diverse regions. The numerous cultures tend to conflict with one another. This crisis is clearly manifest in the actions of the Pakistani you th –rebellions, and indecisiveness. The struggle for Pakistan was a unique historical experience with few parallels in the annals of history. It transcended ethnic ,linguistic, cultural and regional differences and coalesced into a powerful movement culminating in the creation of an independent homeland for the Muslims of the sub-continent. It even defied the geographic compulsions. In essence, it was an experience of a deep Muslim consciousness which both inspiring and invigorating. However ,Pakistan after its creation was, indeed ,and ethnically plural society. Pakistan, these days is passing through a crucial era of multifarious ethnic problems; multi-lingual and regional; problems etc. The province of the Punjabi has three distinct ethno-linguistic groups i.e. Punjabi ,Potohari and Saraiki speaking .Of late ,there has been a nascent rise of Saraiki consciousness with a demand for a separate Saraiki Province comprising of Saraiki speaking areas . In Baluchistan the Baluch , Brohi and Pakhtoons are dominated ethnoligual groups. The wide spread nationalist consciousness of Balchusitan has cut across the tribal divisions. In the North-Western Province of Pakistan ,apart from Pushtu,Hindku and Saraiki are also spoken in some parts of this province .The Pustoons as an ethnic group are integrating with the economic life of the rest of the country .The issue of Kalabagh Dam has arisen out of the same ethnic issue and provincial disharmony of Pakistan in the province. Though the proposed dam may play the role of key factor in the prosperity of the country and may breath a new life in the agricultural and industrial life of Pakistan .Moreover the  ethnic groups of the province also demand regional and to rename the province as Pakhtoonistan. Similarly the problem of ethnicity in Sindh is very complex. It is a web of discards, clash of interest and the resultant sense deprivation between the different ethnic groups. Overawed bewildered conditions, the inhabitants themselves ,sometime become bewildered and the frequent out –burst of violence creates hysteria among the people which consequences which are damaging for the peace and harmony of the province and also for the nation as a whole. All cultural activities can be perpetuated through private-sector support by providing incentives and tax breaks. Let there be encouragement by the government for partnerships of commerce and culture, for promoting a positive, cultural image of Pakistan. The government needs to do a lot, but it needn’t do it alone — through a strategic plan each Pakistani can be encouraged to become a cultural worker. Pakistan is today at a crossroads due to challenges posed in the post 9/11 world — the world of so-called clash of civilizations — with an increasing polarization between the Muslims and the Western world. The affect of negative images flashed around the world can only be counter-acted through a cultural offensive. To achieve our objective of becoming a favored country for investment, culture will need to be placed at the core of our development policies and propagated with every possible means. It is not only political and diplomatic strategies that will create a better image for our country, but equally the propagation of our cultural agenda that is likely to pay dividends. Let us promote our vision of a cultural Pakistan, Saqafati Pakistan, to provide another window to our country, a world removed from violence and negativism, promoting instead an image of a pluralistic Muslim country, a depository of rare cultural assets, along with historical memories and spiritual orientation of its people. Each public sector organization and private sector, too, can be engaged in promoting our cultural resources, through even simple means of films, posters, images and leaflets: PIA within aeroplanes and national and international offices, Pakistan Railways by utilizing its countrywide stations, Pakistan Post Office through its innumerable outlets, the technological gateways and countless websites, to name a few. Let us not fritter away our family silver and the fragrance of the incense stick, but safeguard them and utilize them for creation of a cultural Pakistan, for not only development and well being  of our people, but also for social and economic advancement of our nation. Environmental issues: Water pollution from raw sewage, industrial wastes, and agricultural runoff; limited natural fresh water resources; a majority of the population does not have access to potable water; deforestation; soil erosion; desertification. Little attention was paid to pollution .Some are these Related concerns, such as sanitation and potable water, received earlier scrutiny. In 1987 only about 6 percent of rural residents and 51 percent of urban residents had access to sanitary facilities; a Greater success has been achieved in bringing potable water within reach of the people; nearly half the population enjoyed such access by 1990. However, researchers at the Pakistan Medical Research Council, recognizing that a large proportion of diseases in Pakistan are caused by the consumption of polluted water, have been questioning the â€Å"safe† classification in use in the 1990s. Even the 38 percent of the population that receives its water through pipelines runs the risk of consuming seriously contaminated water, although the problem varies by area. In Punjab, for example, as much as 90 percent of drinking water comes from groundwater, as compared with only 9 percent in Sindh. The central government’s Perspective Plan (1988–2003) and previous five-year plans do not mention sustainable development strategies. Further, there have been no overarching policies focused on sustainable development and conservation. The state has focused on achieving self-sufficiency in food production, meeting energy demands, and containing the high rate of population growth, not on curtailing pollution or other environmental hazards. In 1992 Pakistan’s National Conservation Strategy Report attempted to redress the previous inattention to the nation’s mounting environmental problem. Drawing on the expertise of more than 3,000 people from a wide array of political affiliations, the government produced a document outlining the current state of environmental health, its sustainable goals, and viable program options for the future. Of special concern to environmentalists is the diminishing forest cover in watershed regions of the northern highlands, which has only recently come under close scrutiny.

Robotics in Healthcare: Personalizing care and boosting

Robotics in Healthcare: Personalizing care and boosting the quality, access and efficiency of healthcare (Miss Madhu Hiremath) **Student, Department of Hospital Management, IIHMR, Bangalore Abstracts: Human life is evolving and so is technology. Healthcare, which is one of the major concerns in the 21stCentury, is entering a phase where technology Is becoming an enabler. In the near future, say technologists and doctors, robots will help us a great deal In bringing down the northbound costs of healthcare and Improving operational efficiency and quality of care.Robotics for Healthcare caters mainly six representative areas like Smart medical capsules, Robotized surgery, Intelligent prosthetics, Robotized motor coordination analysis and therapy, Robot-assisted mental, cognitive and social therapy, Robotized patient monitoring systems and many more innovations are expected by around the year 2025. Ethical and legal aspects are also likely to pose obstacles to the developments at some po int. It is a field of innovation that encompasses many Interesting leads, problems to be solved and challenges to e met.Robotic surgery is one of the most significant advances in healthcare in recent years. However like any other technological advance, It too comes with a heavy price tag. Aggressive marketing by the manufacturers and surgeons may lead to unethical practices. This article analyses the applicability of robotics to healthcare In India and as compare to North America and European countries. India too is not left behind In acquiring robots In their surgical departments like Nova spine care, Apollo, AllMS, KIMS, Medanta Hospitals etc.At present, the scope for robotics in India is limited because of cost considerations. However Robots aren't being designed to eliminate people. Instead, they can help reduce physical demands and workloads. Key Words: Robotics for Healthcare, Intelligent prosthetics, Robotized motor coordination analysis, Robotic surgery Reference: http://vwv w_Informationweek_corn/healthcare/clinlcal-informatlon-systems/ vmw. roboucsbuslnessrevlew. com/research/report/ outlook_for_health_care_robotics_for_2013 http://www. kineticconsulting. co. uk/ robots. html 1 OF2

Capital Structure in a Perfect Market

MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. Chapter 14: Capital Structure in a Perfect Market 14-5. Suppose Alpha Industries and Omega Technologies have identical assets that generate identical cash flows. Alpha Industries is an all-equity firm, with 10 million shares outstanding that trade for a price of$22 per share. Omega Technologies has 20 million shares outstanding as well as debt of $60 million. 14-5-a.According to MM Proposition I, what is the stock price for Omega Technologies? V(alpha) = 10 x 22 = 220m = V(omega) = D + E E = 220 – 60 = 160m p = $8 per share. 14-5-b. Suppose Omega Technologies stock currently trades for $11 per share. What arbitrage opportunity is available? What assumptions are necessary to exploit this opportunity? Omega is overpriced. Sell 20 Omega, Buy 10 alpha and borrow 60. Initial = 220 – 220 + 60 = 60. Assumes we can trade shares at current prices & Assumes we can borrow at same terms as Omega (or own Omega debt and can sell at same price). 4-6. Cisoft is a highly profitable technology firm that currently has $5 billion in cash. The firm has decided to use this cash to repurchase shares from investors, and it has already announced these plans to investors. Currently, Cisoft is an all equity firm with 5 billion shares outstanding. These shares currently trade for $12 per share. Cisoft has issued no other securities except for stock options to its employees. The current market value of these options is $8 billion. 14-6-a. What is the value of Cisoft’s non-cash assets?Assets = cash + non-cash, Liabilities = equity + options. non-cash assets = equity + options – cash = 12 ? 5 + 8 – 5 = 63 billion 14-6-b. With perfect capital markets, what is the market value of Cisoft’s equity after share repurchase? What is the value per share? Equity = 60 – 5 = 55. Repurchase 5b / 12 = 0. 417b shares = 55 / 4. 583 = $12 4. 583 b shares remain Per share value MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 4-8. Explain what is wrong with the following argument: â€Å"If a firm issues debt that is risk free, because there is no possibility of default, the risk of the firm’s equity does not change. Therefore, risk-free debt allows the firm to get the benefit of a low cost of capital of debt without raising its cost of capital of equity. † Any leverage raises the equity cost of capital. In fact, risk-free leverage raises it the most (because it does not share any of t he risk). 14-12. Hubbard Industries is an all-equity firm whose shares have an expected return of 10%.Hubbard does a leveraged recapitalization, issuing debt and repurchasing stock, until its debt=equity ratio is 0. 60. Due to the increased risk, shareholders now expect a return of 13%. Assuming there are no taxes and Hubbard’s debt is risk free, what is the interest rate on the debt? wacc = ru = 10% = 1 0. 6 x ? 1. 6(10) ? 13 = 3 = 0. 6 x ? x = 5% 13% + 1. 6 1. 6 14-17. Zelnor, Inc. , is an all-equity firm with 100 million shares outstanding currently trading for $8. 50 per share. Suppose Zelnor decides to grant a total of 10 million new shares to employees as part of a new compensation plan.The firm argues that this new compensation plan will motivate employees and is a better strategy that giving salary bonuses because it will not cost the firm anything. a. If the new compensation plan has no effect on the value of Zelnor’s assets, what will the share price of the n ew stock be once this plan is implemented? Assets = 850m. New shares = 110 ? price = 850 = $7. 73 110 b. What is the cost of the plan for Zelnor’s investors? Why is issuing equity costly in this case? Cost = 100(8. 50 ? 7. 73) = 77m = 10(7. 73) Issuing equity at below market price is costly. MBA  509  Recommended  Chapter  QuestionsThese  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. Chapter 15: Debt and Taxes 15-1. Pelamed Pharmaceuticals has EBIT of $325 million in 2006. In addition, Pelamed has interest expenses of $125 million and a corporate tax rate of 40%. a. What is Pelamed’s 2006 net income? Net Income = EBIT – Interest – Taxes = (325 – 125) x (1-0. 40) – $120 million b. What is the total of Pelamed’s 2006 net income and int erest payment? Net Income + Interest = 120 = 125 = $245 million c.If Pelamed had no interest expenses, what would its 2006 net income be? How does it compare to your answer in part (b)? NetIncome = EBIT ? Taxes = 325 ? (1 ? 0. 40) = $195 million This is 245 ? 195 = $50 million lower than part (b). d. What is the amount of Pelamed’sinterest tax shield in 2006? Interest tax shield = 125 ? 40% = $50 million MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 15-3. Suppose the corporate tax rate is 40%.Consider a firm that earns$1000 before interest and taxes each year with no risk. The firm’s capital expenditures equals its deprecation expenses each year, and it will have no change to its net working capital. The risk-free inter est rate is 5%. a. Suppose the firm has no debt and pays out its net income as a dividend each year. What is the value of the firm’s equity? NetIncome = 1000 ? (1 ? 40%) = $600. Thus, equity holders receive dividends of $600 per year with no risk. 600 E= = $12, 000 5% b. Suppose instead the firm makes interest payments of $500 per year. What is the value of equity?What is the value of debt? 300 = $6000 5% Debt holders receive interest of $500 per year ? D – $10,000 NetIncome ? (1000 ? 500) ? (1 ? 0. 40) = $300 ? E c. What is the difference between the total value of the firm with leverage and without leverage? With Leverage = 6,000 + 10,000 = $16,000 Without Levergae = $12,000 Difference = 16,000 – 12,000 = $4000 d. The difference in part  © is equal to what percentage of the value of the debt? 4, 000 = 40% = corporate tax rate 10, 000 MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  coveri ng  on  the  final  exam.Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 15-6. Arnell Industries has $10 million in debt outstanding. The firm will pay interest only on this debt. Arnell’s marginal tax rate is expected to be 35% for the foreseeable future. a. Suppose Arnell pays interest of 6% per year on its debt. What is the annual interest tax shield? Interest tax sheild = $10 ? 6% ? 35% = $0. 21 million b. What is the present value of the interest tax shield, assuming its risk is the same as the loan? PV(Interest tax sheild) = $0. 21 = $3. 5 million 0. 06 c.Suppose instead that the interest rate on the debt is 5%. What is the present value of the interest tax shield in this case? Interest tax sheild = $10 ? 5% ? 35% = $0. 175 million $0. 175 = $3. 5 million PV = 0. 05 15-8. Rumolt Motors has 30 million shares outstanding with a price of $15 per share. In addition, Rumolt ha s issued bonds with a total current market value of 4150 MILLION. Suppose Rumolt’s equity cost of capital is 10%, and its debt cost of capital is 5%. a. What is Rumolt’s pretax weighted cost of capital? E = $15 ? 30 = $450m D = $150m Pretax WACC = 450 150 10% + 5% = 8. 75% 600 600 b.If Rumolt’s corporate rate is 35%, what is its after-tax weighted cost of capital? WACC = 450 150 10% = 5%(1 ? 35%) = 8. 3125% 600 600 MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 15-12. Milton Industries expects free cash flow of $5 million each year. Milton’s corporate tax rate is 35%, and its unlevered cost of capital is 15%. The firm also has outstanding debt of $19. 05 million, and it expects to maintain this level of deb t permanently. a.What is the value of Milton Industries without leverage? VU = 5 = $33. 33 million 0. 15 b. What is the value of Milton Industries with leverage? V L = V U + ? c D = 33. 33 + 0. 35 ? 19. 50 = $40 million 15-13. Kurz Manufacturing is currently an all-equity firm with 20 million shares outstanding and a stock price of $7. 50 per share. Although investors currently expect Kurz to remain an all-equity firm, Kurz plans to announce that it will borrow $50 million and use the funds to repurchase shares. Kurz will pay interest only on this debt, and it has no further plans to increase or decrease the amount of debt.Kurz is subject to a 40% corporate tax rate. a. What is the market value of Kurz’s existing assets before the announcement? Assets = Equity = $7. 50 ? 20 = $150 million b. What is the market value of Kurz’s assets (including the tax shield) just after the debt is issued, but before the shares are repurchased? Assests = 150 (existing) + 50 (cash) + 40 % ? 50 (tax sheild) = $220 million c. What is Kurz’s share price just before the share repurchase? How many Shres will Kurz repurchase? E = Assets ? Debt = 220 ? 50 = $170 million $170m = $8. 50 Share Price = 20 50 = 5. 882 million shares Kurz will repurchase 8. 50 d.What are Kurz’s market value balance sheet and share price after the share repurchase? Assets ? 150(existing ) + 40% ? 50(taxsheild ) = $170 million Debt = $50 million E = A ? D = 170 ? 50 ? $120 million $120 = $8. 50 / share Share price = 20 ? 5. 882 MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 15-15. Suppose the corporate tax rate is 40%, and investors pay a tax rate of 15% on income from dividends or capital gains and a tax rate of 33. 3% on interest in come.Your firm decides to add debt so it will pay an additional $15 million in interest each year. It will pay this interest expense by cutting its dividend. a. How much will debt holders receive after paying taxes on the interest they earn? $15 ? (1 ? 0. 333) = $10 million each year b. By how much will the firm need to cut its dividend each year to pay this interest expense? Given a corporate tax rate of 40%, an interest expense of $15 million per year reduces net income by 15(1-0. 4)=$9 million after corporate taxes. c. By how much will this cut in the dividend reduce equity holders’ annual after-tax income? $9 million dividend cut ? 9 ? (1 ? 0,15) ? $7. 65 million per year d. How much less will the government receive in total tax revenues each year? Interest atxes = 0. 333 ? 15 = $5 million Less corporate taxes = 0. 40 ? 15 = $6 million Less dividend taxes = 0. 15 ? 9 = $1. 35 million [note: this equals (a) – (c)] e. What is the effective tax advantage of debt ? * ? (1 ? 0. 40)(1 ? 0. 15) ? * = 1? = 23. 5% 1 ? 0. 333 15-16. Markum Enterprises is considering permanently adding $100 million of debt to its capital structure. Markum’s corporate tax rate is 35%. a. Absent personal taxes, what is the value of the interest tax shield from the new debt?PV = ? c D = 35% ? 100 = $35 million b. If investors pay a tax rate of 40% on interest income, and a tax rate of 20% on income from dividends and capital gains, what is the value of the interest tax shield from new debt? ? * = 1? (1 ? 0. 35)(1 ? 0. 20) = 13. 33% 1 ? 0. 40 PV = ? C D = 13. 33% ? 100 = $13. 33 million MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 15-19. With its current leverage, Impi Corporation will have net income next year of $4 . million. If Impi’s corporate tax rate is 35% and it pays 8% interest on its debt, how much additional debt can Impi issue this year and still receive the benefit of the interest tax shield next year? Net income of $4. 5 million ? 4. 5 = $6. 923 million in taxable income. Therefore, Arundel can increase its interest expense by $6. 923 million, which corresponds to debt of: 6. 923 = $86. 5 million 0. 08 MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam.Chapter 16: Financial Distress, Managerial Incentives and Information 16-2. Baruk Industries has no cash and a debt obligation of $36 millionthat is now due. The market value of Baruk’s assets is $81 million, and the firm has no liabilities. Assume a perfect capital market. a. Suppose Baruk has 10 million shares outstanding. What is Baruk’s current share price? 81 ? 36 = $4. 5 / share 10 b. How many new shares must Baruk issue to raise the capital needed to pay its debt obligation? 36 = 8 million shares 4. 5 c. After repaying the debt, what will Baruk’s share price be? 81 = $4. 5 / share 18 16-3.When a firm defaults on its debt, debt holders often receive less than 50% of the amount they are owed. Is the difference between the amount debt holders are owed and the amount they receive a cost of bankruptcy? No. Some of these losses are due to declines in the value of the assets that would have occurred whether or not the firm defaulted. Only the incremental losses that arise from the bankruptcy process are bankruptcy costs. 16-4. Which type of firm is more likely to experience a loss of customers in the event of financial distress: a. Campbell Soup Company or Intuit, Inc.? Intuit Inc. its customers will care about their ability to receive upgr ades to their software. b. Allstate Corporation or Reebok International? Allstate Corporation – its customers rely on the firm being able to pay future claims. MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 16-5. Which type of assets is more likely to be liquidated for close to its full market value in the event of financial distress? a. An office building or a brand name?Office building—there are many alternate users who would be likely to value the property similarly. b. Product inventory or raw materials? Raw materials—they are easier to reuse. c. Patent right of engineering â€Å"know-how†? Patent rights—they would be easier to sell to another firm. 16-9. Marpor Industries has no debt and expects to generate free cash flows of $16 million each year. Marpor believes that if it permanently increases its level of debt to $40 million, the risk of financial distress may cause it to lose some customers and receive less favorable terms from its suppliers.As a result, Marpor’s free cash flows with debt will be only $15 million per year. Suppose Marpor’s tax rate is 35%, the risk-free rate is 5%, the expected return of the market is 15%, and the beta of Marpor’s free cash flows is 1. 1. (with or without leverage). a. Estimate Marpor’s value without leverage r = 5% + 1. 1? (15% ? 5%) = 16% 16 V= = $100 million 0. 16 b. Estimate Marpor’s value with the new leverage. r = 5% + 1. 1? (15% ? 5%) = 16% 15 V= + 0. 35 ? 40 = $107. 75 million 0. 16 MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam.Understand  the  answers  to  these  questio ns  and  should  not  be  surprised  by  anything  on  the  exam. 16-10. Real Estate Purchases are often financed with at least 80% debt. Most corporations, however, have less that 50% debt financing. Provide an explanation for this difference using the trade-off theory. According to tradeoff theory, tax shield adds value while financial distress costs reduce a firm’s value. The financial distress costs for a real estate investment are likely to be low, because the property can generally be easily resold for its full market value.In contrast, corporations generally face much higher costs of financial distress. As a result, corporations choose to have lower leverage. 16-11. Dynron Corporation’s primary business is natural gas transportation using its vast gas pipeline network. Dynron’s assets currently have a market value of $150 million. The firm is exploring the possibility of raising $50 million by selling part of its pipeline network and i nvesting the $50 million in a fiber-optic network to generate revenues by selling high-speed network bandwidth.While this new investment is expected to increase profits, it will also substantially increase Dynron’s risk. If Dynron is levered, would this investment be more or less attractive to equity holders than if Dynron had no debt? If Dynron has no debt or if in all scenarios Dynron can pay the debt in full, equity holders will only consider the project’s NPV in making the decision. If Dynron is heavily leveraged, equity holders will also gain from the increased risk of the new investment. 16-18. Which of the following industries have low optimal debt levels according to the tradeoff theory? Which have high optimal levels of debt? a.Tobacco firms high optimal debt level—high free cash flow, low growth opportunities Accounting firms low optimal debt level—high distress costs Mature restaurant chains high optimal debt level—stable cash flows, low growth, low distress costs Lumber companies high optimal debt level—stable cash flows, low growth, low distress costs Cell phone manufacturers low optimal debt level—high growth opportunities, high distress costs b. c. d. e. MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. 6-19. According to the managerial entrenchment theory, managers choose capital structures so as to preserve their control of the firm. On the one hand, debt is costly for managers because they risk losing control in the event of default. On the other hand, if they do not take advantage of the tax shield provided by debt, they risk losing control through a hostile takeover. Suppose a firm expects to generate free cash flows of $90 million per year, and t he discount rate for these cash flows is 10%. The firm pays a tax rate of 40%. A raider is poised to take over the firm and finance it with $750 Million in permanent debt.The raider will generate the same free cash flows, and the takeover attempt will be successful if the raider can offer a premium of 20% over the current value of the firm. What level of permanent debt will the firm choose, according to the managerial entrenchment hypothesis? 90 = $900 0. 10 Levered Value w/ Raider = 900 + 40%(750) = $1. 2 billion To prevent successful raid,l current managment must have a levered value of at least $1. 2 billion = $1 billion 1. 20 Thus, the minimum tax sheild is $1 billion – 900 million = $100 million, 100 which requires = $250 million in debt 0. 40 Unlevered Value = MBA  509  Recommended  Chapter  QuestionsThese  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questio ns  and  should  not  be  surprised  by  anything  on  the  exam. Chapter 17: Payout Policy 17-6. The HNH Corporation will pay a constant dividend of $2 per share, per year, in perpetuity. Assume all investors pay a 20% tax on dividends and that there is no capital gains tax. The cost of capital for investing in HNH stock is 12%. a. What is the price of a share of HNH stock? P=$1. 60/0. 12=$13. 33 b. Assume that management make a surprise announcement that HNH will no longer pay dividends but will use the cash to repurchase stocks instead.What is the price of a share of HNH stock now? P=$2/0. 12=$16. 67 17-7. What was the effective dividend tax rate for a U. S. investor in the highest tax bracket who planned to hold a stock for one year in 1981? How did the effective dividend tax rate change in 1982 when the Reagan tax cuts took effect? (Ignore State taxes. ) 58. 33% in 1981 and 37. 5% in 1982. 17-10. At current tax rates, which investors are most likely to hold a stock that has a high dividend yield? a. Individual Investors b. Pension Funds c. Mutual Funds d. Corporations 17-11. A stock that you know is held by long-term individual investors paid a large one-time dividend.You notice that the price dropped on the ex-dividend date is about the size of the dividend payment. You find this relationship puzzling given the tax disadvantage of dividends. Explain how the dividends-capture theory might account for this behavior. Dividend capture theory states that investors with high effective dividend tax rates sell to investors with low effective dividend tax rates just before the dividend payment. The price drop therefore reflects the tax rate of the low effective dividend tax rate individuals. MBA  509  Recommended  Chapter  Questions These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam.Understand  the  answers  to  these  questions  and  should  not  be  surpris ed  by  anything  on  the  exam. 17-16. Explain under which conditions an increase in the dividend payment can be interpreted as a signal of: a. Good news By increasing dividends managers signal that they believe that future earnings will be high enough to maintain the new dividend payment. b. Bad news Raising dividends signals that the firm does not have any positive NPV investment opportunities, which is bad news. 17-17. Why is an announcement of a share repurchase considered a positive signal?By choosing to do a share repurchase management credibly signals that they believe the stock is undervalued. 17-20. Explain why most companies choose to pay stock dividends (split their stock). Companies use stock splits to keep their stock prices in a range that reduces investor transaction costs 17-21. When might it be advantageous to undertake a reverse stock split? To avoid being delisted from an exchange because the price of the stock has fallen below the minimum required to s tay listed. 17-22. After the market close on May 11, 2001, Adaptec, Inc. , distributed a dividend of shares of he stock of its software division, Roxio, Inc. Each, Adaptec shareholder received 0. 1646 share of Roxio stock per share of Adaptec stock owned. At the time Adaptec stock was trading at a price of $10. 55 per share (cum-dividend), and Roxie’s share price was $14. 25 per share. In a perfect market, what would Adaptec’s ex-dividend share price be after this transaction? The value of the dividend paid per Adaptec share was (0. 1646 shares of Roxio) ? ($14. 23 per share of Roxio) = $2. 34 per share. Therefore, ignoring tax effects or other news that might come out, we would expect Adaptec’s stock price to fall to $10. 5 – 2. 34 = $8. 21 per share once it goes ex-dividend. (Note: In fact, Adaptec stock opened on Monday May 14, 2001 – the next trading day – at a price of $8. 45 per share. ) MBA  509  Recommended  Chapter  Question s These  questions  are  the  focus  of  what  I  am  covering  on  the  final  exam. Understand  the  answers  to  these  questions  and  should  not  be  surprised  by  anything  on  the  exam. Explain the long-term (3 to 5 years) relative stock performance of companies that have i) issued a seasoned equity offering ii) split their stocks Why would a stock split be a signal for good news?What is meant by â€Å"leaving money on the table,† when issuing an IPO? Why might issuing management be content to leave a lot of money on the table? Can you spot the period of a stock market bubble in the table below? (Hint: look for an oval! ) In retrospect, do you think it is a good long-term investment to purchase stocks where there has been huge amounts of money left on the table? 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Capital  Structure  in  a  Perfect  Market   Summary   1. The  collection  of  securities  a  firm  issues  to  raise  capital  fro m  investors  is  called  the   firm’s  capital  structure. Equity  and  debt  are  the  securities  most  commonly  used  by   firms. When  equity  is  used  without  debt,  the  firm  is  said  to  be  unlevered. Otherwise,  the   amount  of  debt  determines  the  firm’s  leverage. . The  owner  of  a  firm  should  choose  the  capital  structure  that  maximizes  the  total  value   of  the  securities  issued. 3. Capital  markets  are  said  to  be  perfect  if  they  satisfy  three  conditions:   a. Investors  and  firms  can  trade  the  same  set  of  securities  at  competitive  market   prices  equal  to  the  present  value  of  their  future  cash  flows. b. There  are  no  taxes,  transaction  costs,  or  issuance  costs  associated  with  security   trad ing. c. A  firm’s  financing  decisions  do  not  change  the  cash  flows  generated  by  its   investments,  nor  do  they  reveal  new  information  about  them. 4.According  to  MM  Proposition  I,  with  perfect  capital  markets  the  value  of  a  firm  is   independent  of  its  capital  structure. a. With  perfect  capital  markets,  homemade  leverage  is  a  perfect  substitute  for  firm   leverage. b. If  otherwise  identical  firms  with  different  capital  structures  have  different  values,   the  Law  of  One  Price  would  be  violated  and  an  arbitrage  opportunity  would   exist. 5. The  market  value  balance  sheet  shows  that  the  total  market  value  of  a  firm’s  assets   equals  the  total  market  value  of  the  firm’s  liabilities,   including  all  securi ties  issued  to   investors.Changing  the  capital  structure  therefore  alters  how  the  value  of  the  assets  is   divided  across  securities,  but  not  the  firm’s  total  value. 6. A  firm  can  change  its  capital  structure  at  any  time  by  issuing  new  securities  and  using   the  funds  to  pay  its  existing  investors. An  example  is  a  leveraged  recapitalization  in   which  the  firm  borrows  money  (issues  debt)  and  repurchases  shares  (or  pays  a   dividend). MM  Proposition  I  implies  that  such  transactions  will  not  change  the  share   price. 7. According  to  MM  Proposition  II,  the  cost  of  capital  for  levered  equity  is      8. Debt  is  less  risky  than  equity,  so  it  has  a  lower  c ost  of  capital.Leverage  increases  the  risk   of  equity,  however,  raising  the  equity  cost  of  capital. The  benefit  of  debt’s  lower  cost  of   capital  is  offset  by  the  higher  equity  cost  of  capital,  leaving  a  firm’s  weighted  average   cost  of  capital  (WACC)  unchanged  with  perfect  capital  markets: 1 9. The  market  risk  of  a  firm’s  assets  can  be  estimated  by  its  unlevered  beta: 10. Leverage  increases  the  beta  of  a  firm’s  equity: 11. A  firm’s  net  debt  is  equal  to  its  debt  less  its  holdings  of  cash  and  other  risk? free   securities. We  can  compute  the  cost  of  capital  and  the  beta  of  the  firm’s  bus

Early Modern Revolutions Essay Example | Topics and Well Written Essays - 2750 words

Early Modern Revolutions - Essay Example After a discussion on these questions, this paper finally ends with a short conclusion. To understand the concept of revolution, it said that it is best to postpone any attempt to define it until one has inquired into its history. A revolution must not be considered as timeless thing that is wanting of change and variety. Like all human artifacts revolution has a history; therefore, one's understanding of revolution must be sensitive to those changes. Relative to this discussion are the views of revolutionists Max Weber and Friedrich Nietzsche during their time.1 Weber (1864-1920) said, "Definition can be attempted, if at all, only at the conclusion of the study." Meanwhile, Nietzsche (1844-1900) held that "only that which has no history can be defined."2 To understand then a revolution, we look to its history. Both the American and French revolutions happened in the late 18th centuries. Although the two revolutions took place at different occasions and different continents, their causes were very much alike. The American and French Revolutions did acutally both begin with conservative intentions. The Americans wished, they said, to go back to the working arrangement that they had had with the British state since the seventeenth century. On the other hand, the French wished to restore power to the old institutions of the parliaments and the Estates-General. In both cases the revolution rapidly went beyond these conservative premises, to the alarm of many who began the revolution.3 A new concept of revolution arose in the course of these revolutions. Tom Paine, whose pamphlet Common Sense (1776) called the American Revolution as "the birth-day of a new world," went on in The Rights of Man (1791-1792) to see the French and American Revolutions as jointly introducing a truly "age of Revolutions, in which everything may be looked for." Paine4 said - "What were formerly called Revolutions, were little more than a change of persons, or an alteration of local circumstances. They rose and fell like things, of course, and had nothing in their existence or their fate that could influence beyond the spot that produced them. But what we now see in the world, from the Revolutions of America and France, are a renovation of the natural order of things, a system of principles as universal as truth and the existence of man, and combining moral with political happiness and national prosperity." (Paine, 1984 ed., p. 144) Revolution has come to mean the action of human will and human reason upon an imperfect and unjust world, to bring into being the good society, a world of reality.5 At this point, the powerful writing of Sieys (In Whitcomb, 1899)6 can come full to render insights on man's "acting upon an imperfect and unjust world to bring into being the good society." Sieys,7 was said to be the spokesman of the Third Estate in the preliminary struggle for the organization. He wrote about public functions in which he said that the Third Estate attends to nineteen-twentieths of them, with this distinction: "that it is laden with all that which is really painful, with all the burdens which the privileged classes refuse to carry." And then he asked, "Do we give the Third Estate credit for this" He continued - That this might come about, it would be necessary that the Third Estate should refuse to fill these places, or that it should be less ready to exercise their

Inequality for women in the workplace Research Paper

Inequality for women in the workplace - Research Paper Example 565) and yet just over thirty-years later, The Glass Ceiling Commission reported that equity was far from being achieved. The report noted that women continued to earn proportionately less than men for the same work or that there was a wage-gap, and that they made up only a very small fraction of the upper-level positions in U.S. Organizations (Russell, 1995, p. 8). Hence, where there are no visible or concrete (legal) barriers for advancement, the barriers are invisible or made of glass. The following will examine the barriers faced by women in the workplace, and this essay will try and make the transparent visible. It will be argued that inequality can only be explained by how the dominant class in society legitimates and perpetuates power, and how the distinction between gender and sex is important to understanding the actual barriers to equality. In order to arrive at understanding the invisible or glass barriers for women in the workplace, a brief overview of some of the legal o bstacles will first be presented. While it is true that many barriers remain for women in the workplace, it can also be held that the twentieth-century was marked by a significant amount of progress. At the turn of the twentieth century, many obstacles existed for women in the workforce. ... 154). However, as science progressed this form of legitimation proved untenable. Likewise, attitudes changed significantly, and access to higher education meant access to better positions in the workforce. As with progress in education, likewise with the the percentage of women in the workforce in the twentieth century. One of the main contributing causes for this change, are the two World Wars (1914-1918 and 1939-1945) where women were needed to work in the place of men who were participating military action. For example, in 1900 only 5.6 % of all women worked outside of the home, and following the First World War this percentage rose to 23.6 % (Webb, 2010, pp. 1-2). During the era of the Great Depression after the stock market crash of 1929, there was a public sentiment that maintained that the few jobs that existed ought to be given to men, but again, the Second World War changed the workforce demographics again and between 1942 and 1945 over 6.5 million women entered the workforc e in the U.S. (Webb, 2010, p. 2). And, while attitudes were still negative about women in the workforce, there were many public campaigns that promoted it because of the necessity of the War. This had a significant impact on changing attitudes toward women in the workforce, and as with the period following the First World War, the period following the Second was marked by a higher percentage of women who remained employed outside of the home (Webb, 2010, p. 2). Along with the barrier's of access to education and the workforce, a number of legal or legislative changes improved egalitarian conditions in the twentieth-century. The right to vote for women largely came about through the lobbying and

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Was the Paris Peace Conference a failure or a success - Essay Example There were a number of provisions in the treaty the most controversial and important one was that Germany accepts the full responsibility for the cause of World War 1. It levied heavy economical impositions ($31.4 billion) that took a number of years to pay up. Hence, this led Germany unsatisfied. Though financially weak it was not morally weakened. Therefore the treaty failed to subdue Germany in the right manner so that it later took a hostile step bringing much havoc in the world. 2 The Big Four Delegates from 32 different countries met at the Paris Peace Conference; however, four people took active participation in the drawing of treaties and were known as the Big Four. The members of the Big Four were David Lloyd George, Prime Minister of The United Kindom Georges Clemenceau - Prime Minister of France. Woodrow Wilson - President of the United States of America and Vittorio Orlando, Prime minister of Italy. The defeated countries suffered the conclusions of their talks. Wilson wo rked hard to have his Fourteen Points included in the league. He was specifically concerned about the League of Nations.

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Animal diseases and how effect in human - Thesis Proposal Example Basically, the growth of livestock production has resulted in the expansion of possibilities for the spread of disease. The methods of animal domestication, particularly the living and housing conditions of highly domesticated animals considerably create risks of exposure to disease-carrying organisms (Wyld 110). This thesis analyzes the current human health risks posed by the growing livestock industry, and the legal aspect of and solution to this problem. The risks of disease can be prevented or lessened with proper techniques of animal domestication. Unfortunately, management of animal resources is largely tied to sustaining or boosting efficiency or output. Before, cattleman could care for animals more thoroughly. Nowadays, the number of cattlemen is not just fewer, but they are also obliged to attend to massive numbers of domesticated animals as cost efficiently and productively as possible (Sapkota et al. 663). The decrease in the number of workforce in livestock farming alongside the escalating production of domesticated animals can result in poor hygiene and disease management which, consequently, may lead to the spread of communicable disease among the domesticated animals and perhaps even transmission to human beings in the immediate vicinity. There is also the possibility of diseased animal protein contaminating the food chain and threatening the health of human beings (Sapkota et al. 663-664). A particular disease control practice used in rigorous animal domestication is to recognize the commonness of disease or the chronic presence of viruses. Vaccinations and antibiotic medicines are hence regularly given in order to maintain the health and productivity of domesticated animals (Smith & Kelly 29). When disease epidemics take place, it may not be feasible to harvest stock because of the sheer size of the population of domesticated animals. Likewise, cattle houses may have been inadequately built and cannot be correctly or thoroughly sanitized, and

Activity Evaluation Essay Example | Topics and Well Written Essays - 1250 words

Activity Evaluation - Essay Example mining whether the available resources in a program have been efficiently utilized towards the end of meeting the set goals/ objectives while also importantly helping the one undertaking the evaluation to enhance the program especially by learning from the successes and correcting any mistakes that may have occurred during the implementation process (one gets to understand what is working and what aspects need reconsidering). Evaluation, just like the planning of health education is a continuous process and not a one-off affair that warrants continued revisions and updates. My activity evaluation of the project embraced more of a multi-pronged approach where several various methods were utilized to evaluate the effectiveness and efficiency of the implemented regime. In my endeavors, I employed various evaluation instruments such as interviews, questionnaires and data comparisons pre-and-post-implementation, all in attempts of conducting thorough process evaluation, impact evaluation and outcome evaluation. I collected feedback from the community regarding the health education program that had been implemented and the financial aid measures enforced therewith. I used a prepared check-list to determine whether the activities were being conducted as planned for process evaluation. For impact evaluation, I researched on behavior variations that are taking place as a consequence of the implemented activities, and also sought to know whether level of knowledge regarding Alzheimer’s had improved over time. In this very vein also, I desired to know whether a favorable attitude had been developed from our implementation, if a required skill had been instilled and if a harmful belief had been vanquished. I encountered a few challenges regarding outcome evaluation as I felt it required a bit more time to fully assess and stake claim on long-term changes as a doing of the program implementation. I was also unfortunately unable to completely, in such a short time, state the

How Western Civilization is shaped by what historians call 'others', Essay

How Western Civilization is shaped by what historians call 'others', - Essay Example Conquering new regions necessitated the formulation of new ways to hold the vast empires together. Machiavelli expounded upon how the rulers should incorporate the newly acquitted territories comprising of people belonging to distinct regions, usually having high expectations from the new ruler. According to Machiavelli’s views, newly acquired territories and foreign states can be regarded as the ‘other’. Machiavelli states that these states can be divided between principalities and republics and in ‘The Prince’, he elaborates on principalities. According to him, principalities can be divided between hereditary principalities and new principalities, with the former being the ones formerly ruled by the ruler’s ancestors, while the new being the new ones acquired or added to current state by the ruler.1He further states that it is easier to rule hereditary principalities because the society is already accustomed to the rule. However, in case of a new principality, the ruler has to be shrewd so that the people do not revolt against him, when he fails to fulfill all their expectations as a new ruler. Machiavelli proposes that a ruler should suppress such a revolt and then punish the conspirators severely in order to set an example and inhibit future revolts2. Machiavelli regards the upholding of a new principality as more difficult because if a ruler is unable to fully conform to their expectation, then people take up arms against him. It is much easier to rule a new principality, if people share the same language, culture and customs. The prince could assassinate the old ruler’s family and introduce new taxes and if he ensure that society’s prevalent customs and norms are upheld, people will not revolt. In new territories with strong linguistic and cultural differences, a ruler must live there to ensure the local rulers don’t revolt and foster close ties with the subjects. He could also form colonies whi ch would be cheaper than to have a widespread military existence, which may induce a revolt as well. However, it would negatively affect the poor and distant populations, but because they are unable to revolt, they should be crushed. Consequently, most people would ally with the prince and the rest will fear him. To support his argument, he gives the example of Louis X113. In order to maintain his presence in a foreign region, a prince must not only subjugate the people, but remain the strongest one and ensure no neighboring power takes over. He must suppress the strong powers and by default the weaker ones would ally with him and his will remain the most dominant state in the region. Princes must also be wary of new problems that could turn into a serious issue and must undertake preemptive measures.4 In newly acquired territories that were previously free, it is better for a prince to completely destroy, so that no threat of revolt remains, as otherwise traditional ties due to sha red history of freedom will propel them to revolt5. However, in a territory that was previously ruled by a prince, once the old ruler is killed, there is no threat of revolt as people are accustomed to blindly obey the ruler. In addition, a new ruler must strive to depend on his own prowess, rather than passively relying on fortune. Such a ruler is more successful in maintain order and introducing a new set of rules, as he uses force and accomplishes his goals6. According to Machiavelli, a prince chosen by nobles or people must strive to foster

Modern Chinese History Essay Example | Topics and Well Written Essays - 1750 words

Modern Chinese History - Essay Example According to him, self-strengthening programs that advocated for training led to the introduction of modern schools and arsenal. To achieve National and personal strength, he acknowledged that it does not only arise from the  physical effort  but also the will to acquire and preserve. He argued that a strong leadership and physical prowess merely depend on the will of the individuals to act heroically (Schell 205). These notions intertwined with Confucius teachings help to shape the beliefs and behavior of the nation. Although some individuals despised his concepts and ideas, he demonstrated, taught, and inspired Chinese through his writing through his publications. These writings were effective in cultivating moral standard inspired by truth. This resulted in the eruption of May Fourth Incident in 1919, where individuals demonstrated. A movement by the name May Fourth movement emerged with a collective desire to liberate China and cultivate a new Chinese culture (Schell 207). It targeted to change the political system of the country to make it flexible to accommodate further changes that may occur in the future. Although the movement did not have a clear objective, they opted to attract good governance even though it shall be through violent and harsh manner. The group appreciated the concepts that Mao taught in Chen Duxius, New Youth. According to the movement, direct violent among other political actions are fundamental ingredients for revolutionary action. After working for a longer time in the university library, Mao Zedong returned home in 1920 to form a study group. The group discussed Marxism and socialist  ideologies.Within the group, he emphasized the concept of Marxism especially the historical materialism that described history and dynamics of developing the  history.

Finance assignment1 Essay Example | Topics and Well Written Essays - 2250 words

Finance assignment1 - Essay Example 64400 36000 28400 Since the least payment to be paid by Alresford to Gibson under third option, i.e., 28400, it is advisable to go ahead with third option. (d) Under Imputation system, the tax payable by the company is deductible for the tax computation of shareholders. The imputation system, when the company's tax is avoided the calculation will be as follows: Operating cash flow north south total cost of capital market value 12000 12000 24000 18% 4320 12000 8000 20000 18% 3600 16000 8000 24000 18% 4320 20000 4000 24000 18% 4320 PART B The Cost and Benefits of Debt Introduction Among the various sources of capital, debt is an important and popular source of long term fund for small as well as big firms. Other sources include equity and preference shares and retained earnings. Debt is a long term arrangement with a lender by a company to avail finance on a certain set of conditions. The lender may be banks and financial institutions, public, and other corporations issuing debt securities. The company can avail debt capital in various forms such as bonds, long term loans from banks and financial institutions etc. Bond is the most common form of debt security issued by a corporation. Bonds are issued by governments also in time of financial crisis. Debt is the least cost and hence the most popular source of capital for corporations. In addition to that it has many advantages. As bonds are the common form of debt capital, bonds and debt are often used interchangeably. Moreover, the attributes of bonds as a source of long term capital are similar to any other de bt capital. Therefore, the following discussion of cost and benefits of debt is common to bonds and long term loans. Cost of Debt Debt is a long term agreement with a lender (bank or public) by a...The company can avail debt capital in various forms such as bonds, long term loans from banks and financial institutions etc. Bond is the most common form of debt security issued by a corporation. Bonds are issued by governments also in time of financial crisis. Debt is the least cost and hence the most popular source of capital for corporations. In addition to that it has many advantages. As bonds are the common form of debt capital, bonds and debt are often used interchangeably. Moreover, the attributes of bonds as a source of long term capital are similar to any other debt capital. Therefore, the following discussion of cost and benefits of debt is common to bonds and long term loans. Debt is a long term agreement with a lender (bank or public) by a company to avail funds on the condition that interest shall be paid by the latter to the former during the period of debt and the principal shall be paid at the end of maturity period. The interest to be payable by the company to the lender is known as the cost of debt. In other words, cost of debt is the interest payable by the company to the lender for using the latter's hard earned money. The interest payment is to be made annually or semi-annually depending upon the terms of agreement.

Investment in Gold and its effect on the society Essay Example for Free

Investment in Gold and its effect on the society Essay Gold is the most popular form of investment of all the precious metals. Many investors in the contemporary society prefer to buy gold as protection against crisis that may emanate from changes in the political, economic, social or financial systems in the society. Political economy has great impact on the economic development of a country because of the interaction between the economy and the society . For instance, a crisis may be caused by political instability triggered by social unrest or war, decline in market investment, inflation, currency failure and burgeoning of a national debt. The popularity of gold in investment has resulted to the establishment of a gold standard. The term â€Å"gold standard† refers to a monetary system whereby the standard economic unit of an account is defined by a certain fixed weight of gold. Investment in gold can have negative and positive impact on the society. This paper will discuss the issue of investment in gold and how it affects the society. Issues that will be addressed include how and why gold serves as money in the monetary system. In addition, how tightly the gold is tied to the movement of money as well as the ancient history and legends on gold will be covered. Discussion Importance of gold in the World Monetary system The human lust for gold has been witnessed since the existence of ancient races and civilizations. Throughout history, gold has always been used as a relative standard for currency and a form of payment. Ancient civilizations used gold coins as money because of their high value and lack of paper money. However, even after the introduction of paper money, the significance of gold in the monetary system remained. In the late nineteenth century, gold standards were introduced in various European nations. However, the gold standards were affected by a financial crisis that was witnessed during the First World War. During the war, the US and Great Britain were some of the countries that suspended the strict Gold Standard but Great Britain returned to the gold bullion standard in 1925. The significance of gold in the monetary system increased after the World War II when gold was pegged to the US dollar by the Bretton Woods system. Back then, the US dollar value to the gold was pegged at the rate of $35 per troy ounce. The system was eliminated after 1971 when the US made unilateral suspension of direct convertibility of the US dollar to gold. Trading in gold has maintained its importance in replacing money. In the US, the important role of gold was evident in 1975 when trading in gold for delivery was done in New York Commodity Exchange and Chicago International Monetary Market in 1975 . In 1980, the International Monetary Fund (IMF) sold about one third of its gold holdings and in 1986, the American Eagle Gold Bullion coin was introduced by the US Mint. Over the years, gold has maintained its high value and significance in the world monetary system in the contemporary society. Currently, gold continues to be traded across the globe on the basis of intra-day sport price which is derived from gold trading that occurs through the counter in gold-trading markets. The high demand and supply of gold drives the price of gold just like in other many investments. However, disposal and hoarding of gold affects its price in the market because there is more gold that exists to be supplied in the market for the right price. For centuries, gold has been the foundation of monetary systems hence as an investment is considered to be very critical in the global monetary system. This is because it does not generate income hence its intrinsic value is measured based on the Central Bank International Monetary Reserves. Many governments acknowledge the significance of gold in stabilizing the economy . For example, the end of British Gold standard in 1914 paved way for the World War I inflationary financing. The end of the monetary inflation in 1921 on the other hand resulted to stability in the United Kingdom and the United States. This stability resulted to positive effects on rising Bonds and Equity market prices and interest rates. Due to the need to maintain the role of gold in the economy, the Bretton Woods in 1944 ratified the US Gold Exchange Standard of 1935 . Central banks in various influence the gold price and countries can limit gold sales. For example, 1999, limitation of gold sales by the members of the Washington on Gold (WAG) who included Japan, Europe, US, Australia, the IMF and International Settlements was done. The countries limited gold sale to less than 400 tones per annum. Due to the high value of gold and its importance in the monetary system, ancient history and legends have confirmed how important gold has been for centuries. For example, ancient stories have pointed out that the Europeans believed that there was a place of immense wealth that was referred to as El Dorado due to the presence of gold in the place. As a result, many people made efforts to search for the place to get the gold. However, it has never been confirmed whether this place exists or not. In addition, during the Egyptian civilization period, the people used to bury great amounts of gold together with dead pharaohs in belief that they would use the gold in the afterlife. Just like the ancient civilizations, many countries are now interested in increasing their gold reserves as protection in case of a financial crisis. As a result, the countries make efforts to improve the returns of the official gold reserves. The modern world monetary system is founded on gold that has been held by the Central Banks and in the Treasury. Gold is considered to be equal to money due to its importance in the Gold Standard . The three gold standards that are used in the monetary system include the gold specific standard, the gold exchanged standard and the gold bullion standard . A Gold Standard ensures that the public can prevent governments from pursuing destabilizing monetary policies through escape Asset and Debt deflation or Fiscal profligacy. The holdings of gold at the market price by the World Central Bank constitute part of the World International Monetary Reserves(IMRs) upon which the World monetary system is based. Measurement of changes in IMR defines whether there is expansion or contraction of the World Central Bank Monetary Base. In 1944 at the time of the Bretton Woods agreement, gold accounted for about 90 per cent of the consolidated World Central Bank Monetary Reserve and because the United States owned about 90 per cent of the Central Bank gold, the dollar managed to become the International monetary system key currency. Gold has real money value because its value is not affected by changes in the economy or control by the government economic policies. Ancient civilizations recognized the importance of gold hence they had many prisoners of war work in gold mines in search for the gold. In 4000 BC, Eastern Europe began using gold to make fashion and decorative objects and by 1200 BC, Egyptians were beating gold to extend its use in the society. They even combined it with the other metals to create alloys and also use it for the lox-wax technique. In 550 Scathe Greeks mined gold in the Middle East and the Mediterranean and used it foe art and in the monetary system. In 344 BC, Alexander the Great is believed to have crossed the Hellespont carrying vast quantities of gold he had acquired from the Persian Empire. According to the Greek mythology, in 1550 BC, the King of Mycenae who led the Greek expedition to Troy had worn a gold funerary mask. The Romans also mined and used gold which they sometimes sought in the water streams . By 50 BC, the Romans were able to issue a gold coin known as Aureas. The value of gold in the society remained over the years and in 1299AD, Marco Polo wrote about gold that he had seen in his travels to the Far East. In 1903AD, the Gold Standard Act in the US was officially established and enabled the US to maintain a fixed exchange rate as compared to other nations. This ancient history of gold confirms how important gold has been to the society for many centuries as a monetary value and for other applications. Investment in gold Investment in gold is very vital in economic growth and stabilization of the economy . Research studies that have been carried out in the economic confirm that the economy and the wider society interact . Gold is considered to have great value as compared to other precious metals that are mined and used in the society. The significance of gold in relation to the world monetary system makes investment in gold an excellent long-term means of saving and protecting wealth from negative economic forces. Initially, gold coins were used as money when paper money had not been introduced in the economy. However, the introduction of paper money made the carrying of bank notes that were more divisible and lighter than the heavy gold coins more convenient. This case was witnessed in the US during the 1930s Great Depression when President Roosevelt advocated against the use of gold. Gold is also very important when there are negative or low real interest rates. This is because the demand for gold is increased when real estate equity and return on bonds are not adequate to compensate for risk and inflation. For instance, during the 1970s when economic changes resulted from stagflation that led to an economic bubble. In cases where national crisis is experienced as a result of looting, invasion, war or crisis, many investors are concerned about the seizing of the assets and the reduction in currency worth. In efforts to maintain the currency worth, the investors therefore consider gold to be a solid asset and a good form of investment. Investors have taken advantage of the relation between gold and money by investing in various ways. Many investors in gold as well as the economists agree that gold has become the world’s ultimate dollar hedge investment. Investors can invest in gold is various ways . For example, investment in gold can be done through direct ownership, Gold Exchange-Traded Funds(ETFs),gold mutual funds, junior gold stocks and gold options. In direct ownership form of investment, the gold bullion is very important hence the investors who choose to invest in gold through direct ownership enjoy permanent high value of gold. The Gold-Exchange Traded Funds (ETFs) refer to the mutual fund that trade on stock like ordinary stock. In the United States, the two gold ETFs that trade hold onto the gold bullion. On the other hand, the gold mutual funds allow investors to invest where the funds hold portfolios of gold stocks of companies that mine gold while the junior gold stocks are preferred by the investors whose risk of tolerance is broader. The investors hence accept the possibility of gold-based losses. The gold options form of investment is used by the experienced and the sophisticated investors due to the element of speculation in gold prices. Investment in gold can also be done through the purchase of bullion gold bars. In many countries, the billion gold bars are usually sold over the counter in the countries’ major banks. In addition, the gold bullion dealers provide investors with an opportunity to purchase the bars which differ in sizes. As difficulties in storing, verifying and storing pure gold increase, investors now find it easy to invest in gold though a gold account. Because gold bars are easier to store, they are often sold as kilo bars. Investment in gold is also done by buying gold coins and this enables one to hold the monetary value through gold. Examples of banks that sell and buy gold counts over the counter include the Liechtenstein and Swiss banks. The American Eagle billion coin is the most popular gold coin that has been used for hundreds of years. These coins have a stated amount of pure gold made from the denominations that are provided by the treasury. The Gold exchanged traded funds are sold or bought as shares on the major stock exchanges in Sydney, New York and London. For those who investors in gold through the gold billion, a certificate of ownership is held. These certificates enable various investors to sell or buy security without the inconvenience that may be associated with actual physical gold transfer. Gold certificates were first issued to customers in England and Netherlands in the seventeen century in order to allow the investors/ customers to keep the gold bullion safe through the certificates.

Literature Sources for Nurse Administrators

Literature Sources for Nurse Administrators Pramila Chaudhary Nurse leaders today are assuming active role in planning, designing, managing, and organizing patient care delivery models in order to meet the challenges of mounting health care costs faced by health care settings. Department of Health and Human Services, through their Medicare Shared Savings Program, released a rule in 2011, to reward Account Care Organizations that lower healthcare cost and meet evidence-based quality performance parameters (Hajewski, 2014). A nurse administrator in healthcare setting is required to implement measures to find efficient ways of providing nursing care, safety, quality outcomes, and staff development. Planning care management based on evidence and research are within scope of nursing and the conceptual framework of management and leadership (Galganski, 2006). Nurse administrators today have access to many sources of financial and business literature regarding current trends in health care changes and its implication to leadership and management theor y. Table -A below identifies five source journals and Table-B identifies ten literature sources for reference in advance clinical practice and planning care models best outcomes for patients. Nurse leaders are required to continually meet current demands of rising health care costs and must plan to implement value-based changes to provide the best patient care. Table-A below shows management Journals for reference providing knowledge through peer reviewed articles on the web links on the site. Table-B below shows literature sources found to add current knowledge through blogs, news and peer reviewed articles compiled on the web links provided on the site. Interagency Council on Information Resources in Nursing (ICIRN) (ICIRN, 2014) gives a comprehensive guide to how resources can be applied to nursing practice depending on the need to research related practice articles. Journal Resource Usefulness in Practice Journal Of Nursing Administration (JONA) JONA is a journal for nursing leaders and administrators to be used as a guide for decisions in managing healthcare organization related to nursing, business and finance. Nurse leaders can also avail current news, blogs, and research relating to healthcare organizations from JONA, a peer-reviewed journal (JONA, 2014). Nursing Management Journal Nursing Management journal is a resource for nurse leaders with peer-reviewed articles that provide practical information, as well as legal and ethical guide to nursing practice. â€Å"Nursing Management provides regular features, columns, continuing education, staff development and education, and more.† (Nursing Management, 2014). Nursing Administration Quarterly Journal Nursing Administration Quarterly (NAQ) journal provides peer-reviewed articles that nursing administrators can use to answer nursing practice and management related questions. It is published 4 times per year (NAQ, 2014). Nursing Economic$ Journal Nursing Economic$ provides resources for nursing leadership in health care. â€Å"The journal supports nurse leaders and others who are responsible for directing nursings impact on health care cost and quality outcomes.† (Nurse Economics, 2014). Nurse Leader (Bimonthly Journal) Nurse Leader journal is a bimonthly journal and provides nurses with practical information like how to strive for magnet status of hospital and other management studies in organizational theory, and is a valuable reference for nurse leaders (Nurse Leader, 2014). Table-A- Journal Sources Literature Sources Usefulness in Practice American Nurses Association (ANA) Nursing world. ANA is a professional Nursing organization promoting the rights of nurses, lobbying for nurses in the congress. ANA codes of ethics are used as guide to address nursing practice issues. ANA established a code of professional nursing and is a valuable source for ethics in nursing (ANA, 2014). Journal of Advanced Nursing The Journal of Advanced Nursing (JAN) is an international peer reviewed Journal.JAN is well known for research and scholarship advocacy, and for up to date news on quality standards. It is a source for nursing administrators for news, journals articles and current information for nursing, medicine, allied health, and pharmacy. Worldviews on Evidence-Based Nursing. (2014). (Quarterly). This online Journal from Sigma Theta Tau International is free for members and provides knowledge, systematic reviews, and articles useful for nursing practice, current quality and research information. Nursing administrators, nursing educators and public health care policy makers can use this information. STTI addresses current nursing and healthcare trends and issues in nursing and health care (STTI, 2014). Lippincott ‘s Nursing Center.com This site provides professional and clinical database for nursing administration practice and organizations including CE, nursing journals abstracts, certification and licensure guides, news updates, job opportunities, and RSS feeds (Really Simple Syndication). (Nursingcenter.com, 2014). The Joint Commission. The Joint Commission is an independent organization and promotes safe patient care by accreditation for hospitals and other health organizations. Nursing administrators can use this source to guide hospital quality and practice standards (Joint Commission, 214) Online Journal of Nursing Informatics (OJNI) As described in the information about the journal, OJNI provides knowledge regarding electronic documenting for managing health records and nursing care. OJNI can be used for reference and new and updated informatics news in nursing practice (OJNI, 2014). Medscape Nurses web site Medscape Nurses site includes Blogs, experts, and viewpoints; it also provides free newsletters alerts on clinical advances in nursing, and includes current information for education and clinical nursing practice (Medscape nurses, 2014). American Journal of Nursing (AJN) The American Journal of Nursing promotes high standards in nursing practice. It is peer reviewed and evidence-based, and presents professional issues faced by nurses. This is a useful site as it promotes nursing perspectives (AJN, 2014). AHRQ (Agency for Healthcare Research and Quality) The Agency for Healthcare Research and Qualitys (AHRQ) is a resource from U.S. Department of Health and Human Services and offers quality, safety, and evidence based research information (AHRQ, 2014). This site is useful to get current research and quality measures that are being studied and to get data on previous studies, useful for nursing practice as it relates to patient care (AHRQ, 2014). Association of Operating Room Nursing (AORN, 2014) The AORN Journal and website is a resource for standards of operating room nursing with scholarly, evidence-based, peer-reviewed articles. The journal and website provide physiological, behavioral, patient safety. Information regarding research and quality improvement, and education can be obtained here. This journal provides valuable information and recommends standards of perioperative nursing(AORN, 2014). Table –B – Literature Sources The article in Journal of Nursing Administration, â€Å"Care Coordination: A Model for the Acute Care Hospital Setting† by Hajewski Shirey (2014), addresses problem of fragmented care by physicians and multiple care providers resulting in increased health costs. The new care model is developed in response to healthcare reform legislation, which rewards accountable care organizations through a Shared Medicare Savings program, accounting for quality of care and reducing medical cost. The article provides valuable information to nursing administrators. The article in Nursing Management journal by Hollingsworth et al., (2014), â€Å"Diving into data: Quantifying efficiency by improving patient flow† proposes care organizations to strive for quality and volume in keeping with current demands placed by Affordable Care Act. Hollingsworth et al., (2014) propose that hospitals must reduce admission delays, long waits, uncoordinated care, and discharge processes. The article proposes electronic debriefing of daily operations and bed status report to organizational leadership for more efficient outcomes. The article in American Journal of Nursing by Wallis (2014-11), â€Å"CMS to Compensate Providers for Coordinating Care† discusses how nurse practioners may be compensated for services they already provide to chronically ill patients they care for. According to Wallis (2014), CMS establishes new policy to pay for coordination of care in management of multiple chronic health conditions. This policy is geared towards better access and quality of care for Medicare beneficiaries. The article also discusses patient centered care document and Shared Savings Program for long-term care management services. Nurse leaders may apply methods based on information from credible journals to improve care in an efficient manner. The article, â€Å"Physician Practice Participation in Accountable Care Organizations: The Emergence of the Unicorn† by Shortell et al., (2014) analyses a study to evaluate participation of physicians and healthcare management processes to provide efficient care in Accountable care Organizations. Shortell et al., (2014) argue that the affordable care act expansion of coverage will not remain affordable over time, unless hospitals find a way to deliver care more efficiently and effectively. Lewis et al., in their article found in the Cochrane Library database, discussed increasing demand for healthcare providers to reduce costs in surgical cases. Lewis et al., propose that studies did not reveal a clear difference between care provided by anesthesiologist and nurse anesthetist when it came to adverse patient outcomes like death. As healthcare expands in the Affordable Heath Care Act, hospitals are driven toward using nurse anesthetists in order to implement cost reducing measures (Lewis et al., 2014). Nursing leadership can use this study to relate to their facility. Conclusion In conclusion, nurse leaders and managers have access to current and credible literature from wide range of disciplines ranging from nursing, medicine, social sciences, business, finance, and research regarding evidence based practice and quality measures, and management and leadership topics, which is useful in planning and directing nursing care as well as implement changes on policies and procedures that need to be re evaluated. Nursing management includes direct care managers who are responsible for primary care, middle managers who are responsible for coordinating care between departments, and nurse executives who are responsible for directing care in a healthcare facility; reviewing the literature is equally valuable for all levels of management for guiding decisions based on current knowledge. Nurse educators and faculty uses literature review as a teaching strategy, and for professional development of graduating nurses. Searching databases like CINAHL and PubMed will provide a wide range of nursing practice and related discipline topics, in addition nurse administrators need to consider rising health care costs and new regulations to form partnership with government such as Shared Medicare Savings program pose new challenges for todays nursing administrators. References AHRQ. (2014). About Agency for Healthcare Research and Quality. Retrieved from http://www.ahrq.gov/consumer/ American Journal of Nursing. (AJN). (2014). About the Journal. Retrieved from http://journals.lww.com/ajnonline/Pages/AbouttheJournal.aspx American Nurses Association. (2014). About American Nurses Association. Retrieved from http://nursingworld.org/FunctionalMenuCategories/AboutANA Association of Operating Room Nursing. (2014). About AORN. Retrieved from http://www.aornjournal.org Essential Nursing Resources: for the Interagency Council on Information Resources in Nursing (ICIRN).. (n.d.) >The Free Library. (2014). Retrieved from http://www.thefreelibrary.com/Essential+Nursing+Resources%3a+for+the+Interagency+ Council+on-a0209535655 Galganski, C. J. (2006). Mapping the literature of nursing administration. Journal Of The Medical Library Association, 94E-87-E-91. Hajewski, C. (2014-11). Care coordination: a model for the acute care hospital setting. The Journal of nursing administration, 44(11), 577585.doi:10.1097/NNA.0000000000000129 Hollingsworth Forbes III, T., Crickmore Osborne, K., Hartsell, K. C., Wall, B. (2014). Diving into data: Quantifying efficiency by improving patient flow. Nursing Management, 45(7), 18-25. doi:10.1097/01.NUMA.0000451031.54092.2c Joint Commission Resources. (2014) About Joint Commission. Retrieved from http://www.jointcommission.org/about_us/about_the_joint_commission_main.aspx Journal of Nursing Administration (JONA). (2014). About the journal. Retrieved from http://journals.lww.com/jonajournal/pages/aboutthejournal.aspx Lewis SR, Nicholson A, Smith AF, Alderson P. Physician anaesthetists versus non-physician providers of anaesthesia for surgical patients. Cochrane Database of Systematic Reviews 2014, Issue 7. Art. No.: CD010357. DOI: 10.1002/14651858.CD010357.pub2. Lippincott ‘s Nursing Center.com (2014). About the Journal. Retrieved from http://nursingcenter.com Medscape Nurses. (2014). About Medscape Nurses. Retrieved from http://www.medscape.com/nurses/resource Nurse Leader. (2014). About the journal. Retrieved from http://www.nurseleader.com/content/aims Nursing Management (NM). (2014). About the Publication. Retrieved from http://journals.lww.com/nursingmanagement/Pages/aboutthepublication.aspx Nursing Economic$. (2014). The Journal for Healthcare leaders. About the journal. Retrieved from http://www.nursingeconomics.net/cgi-bin/WebObjects/NECJournal Online Journal of Nursing Informatics. (OJNI). (2014). About the Journal. Retrieved from http://www.ojni.org Shortell, S. M., McClellan, S. R., Ramsay, P. P., Casalino, L. P., Ryan, A. M., Copeland, K. R. (2014). Physician Practice Participation in Accountable Care Organizations: The Emergence of the Unicorn. Health Services Research, 49(5), 1519-1536. doi:10.1111/1475-6773.1216 The American Journal of Nursing (AJN). (2014). About the journal. Retrieved from http://journals.lww.com/ajnonline/Pages/AbouttheJournal.aspx The Journal of Advanced Nursing (JAN). (2014). Overview of the journal. Retrieved from http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)13652648/homepage/ProductInfor mation.html Wallis, L. (2014-11). CMS to Compensate Providers for Coordinating Care. The American journal of nursing, 114(11), 16.doi:10.1097/01.NAJ.0000456414.33785.23 Worldviews on Evidence-Based Nursing. (2014). (Quarterly). SSTI Journals. About SSTI. Retrieved from http://www.nursingsociety.org/Publications/Pages/Journals.aspx Wolters Kluwer Health and Lippincott Williams Wilkins. (2014). Retrieved from http://journals.lww.com/pages/default.aspx

Major Histocompatibility Complex (MHC) Functions

Major Histocompatibility Complex (MHC) Functions The immune system is complex, containing thousands of components. On the whole this highly adaptive system works well, protecting the individual primarily against the threat of disease caused by infectious organisms (Wood, 2006). However, the immune system can deteriorate and fail should any component of this refined system be mutated or compromised. In this report, an overview of the immune system will be covered, along with an explanation of how the Major Histocompatibility Complex (MHC) functions specifically. An example of how the immune system can be compromised should the MHC molecule be short or absent will also be discussed with reference to a condition known as Bare Lymphocyte Syndrome. How the MHC molecule contributes to a healthy immune system will be discussed, along with the effect an MHC deficiency has and how this compromises the immune system at a molecular level. Reference will be made to a case study related to the Bare Lymphocyte Syndrome and a conclusion will be made as to how this condition links to the MHC molecule specifically. An Overview of the Immune System The immune system can be split into two systems of immunity, innate and adaptive immunity. Innate immunity is the first line of defence against pathogens in the body, preventing most infections occurring by eliminating the pathogen within hours of being encountered. This is achieved by firstly possessing external barriers to infections such as skin, mucosa, gut flora and lysozymes in tears. Secondly, the immune system mounts an immediate attack against any infectious sources entering the host via pre-existing defence mechanisms within the body. Phagocytosis is the major element contributing to innate immunity. This is the ingestion and destruction of microbes by phagocytes in a process by which the phagocyte attaches to the microbe in question, engulfs the microbe, kills the microbe and then degrades the microbe using proteolytic enzymes (Wood, 2006). This process is aided by complement proteins and opsonisation. Another part of the innate immune response is for inflammation to occur . This enables cells and soluble factors from the bloodstream to be enlisted at a particular tissue site in order to assist in the fight against infection. These can be local or systemic and cause vasodilation to occur at the site of infection; cause the endothelium to have increased expression of adhesion molecules in the cells lining the blood vessels; cause increased vascular permeability and cause chemotactic factors to be produced, therefore attracting cells into the tissue from the bloodstream (Wood, 2006). Overall, innate immunity is the first step in combating infection in the body; however a more specific system is often required. Acquired immunity occurs when a pathogen enters the body which the innate immune system cannot destroy, whether it is the pathogen has evolved a way of being avoided by the cells in the innate immune system or whether it be the pathogen expresses molecules similar to host cells as in the case of viruses. In such cases as these, acquired immunity is needed, where lymphocytes are used to identify, engulf and kill the pathogen in question. This is a more evolutionary advanced system compared to innate immunity. Two types of lymphocyte cells are employed in the acquired immune response; these are B lymphocyte cells, which are responsible for creating antibodies; and T lymphocyte cells, which are more complex in their receptor and require cell-to-cell contact. There are two types of T lymphocyte cells; those expressing CD4 molecules on their surface are referred to as Helper T cells or CD4 T cells, and those expressing CD8 molecules of their surface are referred to as cytotoxic T cells or CD8 T cells. The latter of these two T cells is important in the killing of virally infected cells (Kindt et. al., 2007). T cells recognise antigens by T cell Receptors (TcR) expressed on their surface; each T cell expresses only one TcR specifically. T cells do not recognise free antigens but recognise antigens associated with molecules on the surface of cells called Major Histocompatibility Complex (MHC) molecules (Wood, 2006). MHC molecules specifically for the human species are known as Human Leukocyte Antigens (HLA); these are located on chromosome 6 (Kindt et, al., 2007). The MHC constitutes important genetic components of the mammalian immune system. There are two types of MHC molecules, Class I and Class II MHC. Class I MHC molecules are glycoproteins expressed on the cell surface of most nucleated cells, whereas Class II MHC molecules are also glycoproteins but are restricted in their expression, primarily being found on cells of the immune system such as B cells, macropha ges, dendritic cells and monocytes (Wood, 2006). Class I and II MHC molecules bind to antigens derived from pathogens and present them to T lymphocytes (Sommer, 2005). CD8 T cells recognise antigens presented by Class I MHC molecules whereas CD4 T cells recognise antigens presented by Class II MHC molecules. MHC molecules play an important role in immune defence against intracellular pathogens, peptides derived from viral proteins and cancer infected cells. (Sommer, 2005). Antigen Presentation of MHC Class I An event involving generation of peptides from proteins in the cell and displaying these peptides on the plasma membrane is called antigen processing and presentation (Benjamini et al., 1996). MHC Class I molecules consists of HLA-A, HLA-B and HLA-C. HLA are cell surface heterodimers consisting of a polymorphic ÃŽ ± chain associated with a non-polymorphic ÃŽ ²2 microglobulin protein (Chaplin, 2010). In the antigen presentation pathway of MHC Class I, the viral protein is degraded into peptides through proteasome-mediated proteolysis which is then transported into the endoplasmic reticulum (ER) (fig 1). This transport process is facilitated by a transporter associated with antigen processing (TAP). Once in the ER, the translocated peptide binds to MHC Class I ÃŽ ± chains and ÃŽ ²2 microglobulin through momentary interaction of MHC Class I heterodimers and TAP (Chaplin, 2010). This momentary interaction is carried out with the help of Tapasin (fig 2). This binding of peptide and MHC Cl ass I results in structural changes; eventually leading to the dissociation of peptide-MHC Class I complex (Chaplin, 2010). This peptide-MHC Class I complex then migrates to the cell surface where it is recognised by CD8 T cells triggering the associated immune response. (Raghavan,1999). When the immune system is working correctly, pathogens entering the body will be destroyed rapidly. However, if a component of the immune system is compromised, devastating effects can be seen. An example of this was seen in the case study of Tatiana and Alexander Islayev; two siblings originally from Russia who were suffering from symptoms linked to Bare Lymphocyte Syndrome. Tatiana had severe bronchiectasis and a persistent cough which produced yellow-green sputum. She had been chronically ill since the age of 4 when she had begun to have repeated infections of the sinuses, middle ear and lungs, all due to a variety of respiratory viruses. Both Haemophilus influenza and Streptococcus pneumonia bacteria could be cultured from her sputum. She had been prescribed frequent antibiotic treatments to control her fevers and cough with no success. Her brother, Alexander was also showing the same symptoms. When their blood was examined, both children had elevated IgG levels with over 90% of their T cells being CD4 and only 10% being CD8. Both children expressed very small amounts of MHC Class I molecules in their cells but expressed MHC Class II molecules normally. When the childrens DNA was analysed, it was found that they both had a mutation in the TAP-2 gene. Type I Bare Lymphocyte Syndrome Bare Lymphocyte Syndrome (BLS) Type I also known as MHC Class I deficiency, is characterized by a severe down-regulation of MHC class I and/or class II molecules (Gadola et. al., 2000). Type 1 BLS is due to a defect confined to MHC class I molecules, while type 2 BLS shows down-regulation of MHC class II molecules. Like any other cell surface protein MHC class I molecules are synthesised in the rough endoplasmic reticulum (RER), modified in the Golgi apparatus and are transported in transport vesicles to the cell surface (Wood, 2006). MHC class I molecules bind to different sets of peptides. Translocation of peptides derived from degradation of cytosolic proteins from the cytoplasm into the RER is negotiated by transporter molecules known as transporter associated with antigen processing (TAP) molecules. TAP is a heterodimer consisting of two subunits, TAP-1 and TAP-2, which are encoded in the class II region of the MHC locus on chromosome 6. Deletion or mutation of either or both TA P-1 and TAP-2 proteins severely impairs the translocation of peptides into the RER, the result of which is reduced surface expression of MHC class I molecules (Gadola et. al., 2000). BLS is manifested as a combined immunodeficiency presenting early in life. BLS manifests during the first 6 years of life where affected individuals are susceptible to recurrent opportunistic bacterial infections especially of the upper respiratory tract. In BLS, the underlying cause of Class I deficiency is due to a nonsense mutation in the TAP (Clement et. al., 1988). As discussed earlier, TAP is involved in the critical step of transporting peptides to the inner lumen of ER. In BLS, the deficiencies of active TAP results in the impairment of the transport of peptide to ER. This inefficient transport means that few or no MHC Class I molecules can be complexed with peptides. The un-complexed MHC Class I molecules are highly unstable and are therefore degraded quickly. This ultimately results in low levels of peptide-MHC Class I complex being expressed on the plasma membrane. In this way, deficiency in active TAP leads to low antigen presentation via MHC Class I molecules resulting in inefficient activation of CD8 T lymphocytes and consequently a compromised immune response. The basis of bare lymphocyte syndrome can be concluded from protein coded genes that are transformed and are not able to control the expression of the MHC I genes. Till today a beneficial treatment of TAP deficiency is not yet available; gene therapy isnt possible as almost all of the HLA class I molecule express on nucleated cells. If there is damage to the bronchial and pulmonary tissue lung transplantation can be performed. Contact with tobacco and smoke should be avoided and also vaccinations should be performed against respiratory pathogens. Other than Bare lymphocyte syndrome, MHC class I allotype is also linked to various sero-negative spondarthropathies, such as Ankylosing spondylitis, Psoriatic Arthritis, Reiters Syndrome and Behcets syndrome.