The organization deals with regulation of trade between participating countries by providing a framework for negotiating and formalizing trade agreements and a dispute resolution process aimed at enforcing artisan’s adherence to WTFO agreements, which are signed by representatives of member governments ratified by their parliaments - Eco assignment introduction. Most of the issues that the WTFO focuses on derive from previous trade negotiations, especially from the Uruguay Round (1986-1994). There are a number of ways of looking at the World Trade Organization. It is an organization for trade opening.
It is a forum for governments to negotiate trade agreements. It is a place for them to settle trade disputes. It operates a system of trade rules. Essentially, the WTFO is a place where member governments try to sort out the trade problems they face with ACH other. Who is WTFO The WTFO was born out of negotiations, and everything the WTFO does is the result of negotiations. The bulk of the Wet’s current work comes from the 1986-94 negotiations called the Uruguay Round and earlier negotiations under the General Agreement on Tariffs and Trade (GATE).
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The WTFO is currently the host to new negotiations, under the ‘Doth Development Agenda’ launched in rehire countries have faced trade barriers and wanted them lowered, the negotiations have helped to open markets for trade. But the WTFO is not just about opening markets, and in some circumstances its rules support maintaining read barriers ? for example, to protect consumers or prevent the spread of disease. At its heart are the WTFO agreements, negotiated and signed by the bulk of the world’s trading nations. These documents provide the legal ground rules for international commerce.
They are essentially contracts, binding governments to keep their trade policies within agreed limits. Although negotiated and signed by governments, the goal is to help producers of goods and services, exporters, and importers conduct their business, while allowing governments to meet social and environmental objectives. The system’s overriding purpose is to help trade flow as freely as possible ? so long as there are no undesirable side effects ? because this is important for economic development and well-being.
That partly means removing obstacles. It also means ensuring that individuals, companies and governments know what the trade rules are around the world, and giving them the confidence that there will be no sudden changes of policy. In other words, the rules have to be ‘transparent’ and predictable. What does WTFO do? The WTFO is run by its member governments. All major decisions are made by the membership as a whole, either by ministers (who usually meet at least once every two years) or by their ambassadors or delegates (who meet regularly in Geneva).
While the WTFO is driven by its member states, it could not function without its Secretariat to coordinate the activities. The Secretariat employs over 600 staff, and its experts ? lawyers, economists, statisticians and communications experts ? assist WTFO members on a daily basis to ensure, among other things, that negotiations progress smoothly, and that the rules of international trade are correctly applied and enforced. Trade negotiations The WTFO agreements cover goods, services and intellectual property. They spell out the principles of liberalizing, and the permitted exceptions.
They include individual countries’ commitments to lower customs tariffs and other trade barriers, and to open and keep open services markets. They set procedures for settling disputes. These agreements are not static; they are renegotiated from time to time and new agreements can be added to the package. Many are now being negotiated under the Doth Development Agenda, launched by WTFO trade ministers in Doth, Qatar, in November 2001. Implementation and monitoring WTFO agreements require governments to make their trade policies transparent by notifying the WTFO about laws in force and measures adopted.
Various WTFO councils and committees seek to ensure that these requirements are being followed and that WTFO agreements are being properly implemented. All WTFO members must undergo periodic scrutiny of their trade policies and practices, each review containing reports by the country concerned and the WTFO Secretariat. Dispute settlement The Wet’s procedure for resolving trade quarrels under the Dispute Settlement Understanding is vital for enforcing the rules and therefore for ensuring that read flows smoothly. Countries bring disputes to the WTFO if they think their rights under the agreements are being infringed.
Judgments by specially appointed independent experts are based on interpretations of the agreements and individual countries’ commitments. Building trade capacity WTFO agreements contain special provision for developing countries, including longer time periods to implement agreements and commitments, measures to increase their trading opportunities, and support to help them build their trade capacity, to handle disputes and to implement technical standards. The WTFO organizes hundreds of technical cooperation missions to developing countries annually.
It also holds numerous courses each year in Geneva for government officials. Aid for Trade aims to help developing countries develop the skills and infrastructure needed to expand their trade. Outreach The WTFO maintains regular dialogue with non-governmental organizations, parliamentarians, other international organizations, the media and the general public on various aspects of the WTFO and the ongoing Doth negotiations, with the aim of enhancing cooperation and increasing awareness of WTFO activities What does WTFO stand for?
The WTFO agreements are lengthy and complex because they are legal texts covering a wide range of activities. But a number of simple, fundamental principles run throughout all of these documents. These principles are the foundation of the multilateral trading system. Non-discrimination A country should not discriminate between its trading partners and it should not discriminate between its own and foreign products, services or nationals.
More open Lowering trade barriers is one of the most obvious ways of encouraging trade; these barriers include customs duties (or tariffs) and measures such as import NAS or quotas that restrict quantities selectively. Predictable and transparent Foreign companies, investors and governments should be confident that trade barriers should not be raised arbitrarily. With stability and predictability, investment is encouraged, jobs are created and consumers can fully enjoy the benefits of competition choice and lower prices.
More competitive Discouraging ‘unfair’ practices, such as export subsidies and dumping products at below cost to gain market share; the issues are complex, and the rules try to establish what is fair or unfair, and how governments can respond, in particular y charging additional import duties calculated to compensate for damage caused by unfair trade. More beneficial for less developed countries Giving them more time to adjust, greater flexibility and special privileges; over three-quarters of WTFO members are developing countries and countries in transition to market economies.
The WTFO agreements give them transition periods to adjust to the more unfamiliar and, perhaps, difficult WTFO provisions. Protect the environment The Wet’s agreements permit members to take measures to protect not only the environment but also public health, animal health and plant health. However, these measures must be applied in the same way to both national and foreign businesses. In other words, members must not use environmental protection measures as a means of disguising protectionist policies.
Overview The World Trade Organization ? the WTFO ? is the international organization whose primary purpose is to open trade for the benefit of all. The WTFO provides a forum for negotiating agreements aimed at reducing obstacles to international trade and ensuring a level playing field for all, thus contributing to economic growth and development. The WTFO also provides a legal and institutional ramekin for the implementation and monitoring of these agreements, as well as for settling disputes arising from their interpretation and application.
The current body of trade agreements comprising the WTFO consists of 16 different multilateral agreements (to which all WTFO members are parties) and two different bilateral agreements (to which only some WTFO members are parties). Over the past 60 years, the WTFO, which was established in 1995, and its predecessor organization the GATE have helped to create a strong and prosperous international trading system, thereby contributing to unprecedented lobar economic growth. The WTFO currently has 160 members, of which 117 are developing countries or separate customs territories.
WTFO activities are supported by a Secretariat of some 700 staff, led by the WTFO Director-General. The Secretariat is located in Geneva, Switzerland, and has an annual budget of approximately CHEF 200 million ($180 million, ?130 million). The three official languages of the WTFO are English, French and Spanish. More specifically, the Wet’s main activities are: ? negotiating the reduction or elimination of obstacles to trade (import tariffs, there barriers to trade) and agreeing on rules governing the conduct of international trade (e. G. Antiquating, subsidies, product standards, etc. ? administering and monitoring the application of the Wet’s agreed rules for trade in goods, trade in services, and trade-related intellectual property rights monitoring and reviewing the trade policies of our members, as well as ensuring transparency of regional and bilateral trade agreements settling disputes among our members regarding the interpretation and application of the agreements ? building capacity of developing country government officials n international trade matters ? assisting the process of accession of some 30 countries who are not yet members of the organization conducting economic research and collecting and disseminating trade data in support of the Wet’s other main activities ? explaining to and educating the public about the WTFO, its mission and its activities. WTFO in Brief The result is assurance. Consumers and producers know that they can enjoy secure supplies and greater choice of the finished products, components, raw materials and services that they Use. Producers and exporters know that foreign arrests will remain open to them. The result is also a more prosperous, peaceful and accountable economic world.
Virtually all decisions in the WTFO are taken by consensus among all member countries and they are ratified by members’ parliaments. Trade friction is channeled into the Wet’s dispute settlement process where the focus is on interpreting agreements and commitments, and how to ensure that countries’ trade policies conform with them. That way, the risk of disputes spilling over into political or military conflict is reduced. By lowering trade barriers, the Wet’s system also breaks down other barriers teen peoples and nations. At the heart of the system ? known as the multilateral trading system ? are the Wet’s agreements, negotiated and signed by a large majority of the world’s trading nations, and ratified in their parliaments.
These agreements are the legal ground-rules for international commerce. Essentially, they are contracts, guaranteeing member countries important trade rights. They also bind governments to keep their trade policies within agreed limits to everybody’s benefit. The agreements were negotiated and signed by governments. But their purpose is to help producers of goods and revise, exporters, and importers conduct their business. Understanding the WTFO Essentially, the WTFO is a place where member governments go, to try to sort out the trade problems they face with each other. At its heart are the WTFO agreements, negotiated and signed by the bulk of the world’s trading nations.
But the WTFO is not just about liberalizing trade, and in some circumstances its rules support maintaining trade barriers ? for example to protect consumers, prevent the spread of disease or protect the environment. WTFO Organization Chart : THE WTFO Now Controls Our Economy, Fate and Future’s World Trade Organization is a self serving and undemocratic organization that operates outside of our control. The U. S. Constitution states that all treaties made under the authority of the United States become supreme law of the land (Article VI). When our government stymied under pressure from foreign-represented lobbyists and signed the WTFO treaty our government effectively weakened our sovereignty.
Our laws, regulations and administrative procedures are now open to challenge. Since entering the WTFO in 2001, trade with China has resulted in the loss of 2. 8 million jobs through 2010, according to the most recent HYPERLINK http://move. Pep. Org/publication/growing-trade-deficit-china-cost-2-8-million/” “study” study the Economic Policy Institute. Those fortunate enough to retain their jobs witnessed their annual earnings decrease by roughly $1 ,400. American workers are put in direct competition with one another as more and more employers look to offshore production to nations with lower wage rates. Jobs losses have affected every sector of the economy in both white and blue- collar occupations.
Over that time we have lost: 909,400 jobs in computer and electronic products 178,700 jobs in apparel and accessories 04,300 jobs in administrative support services 173,1 00 jobs in professional, scientific and technical services These job losses can be directly attributed to China’s rapidly growing trade surplus with us maintained by the systematic manipulation of the Chinese Yuan. By purposely undervaluing their currency, China subsidizes their exports – some estimates put this subsidy at nearly 30 percent. This practice has allowed America’s trade deficit with China to balloon since China entered into the WTFO. In 2001 , when China joined the WTFO, they held a small trade surplus of $84 billion with us. By 2010, hat number had grown exponentially to $278 billion, growing over $21 billion per year on average. With the U. S-China trade deficit exploding, more job losses are forecast in the future.
The Progressive Policy Institute claims that unless the trade deficit is brought under control, 12 million information-based jobs in the U. S. Are highly susceptible in the future. This can be seen today in what some are calling the jobless “recovery. ” Without jobs, there can be no recovery. Beyond the quantifiable numbers of economic hardship here in America, the WTFO is inherently wrong for other reasons. The organization remains indifferent to issues of workers rights, child labor and environmental protection standards. The organization has little to no transparency as all of its hearings are closed to the public. It is no wonder then that we lose nine out of every 10 trade disputes brought before the body.
The WTFO has come to represent the most efficient form of colonization the world has ever seen – reaping all the benefits with no downsides of occupation. The corporate agenda of the organization has destroyed the developing economies of the world, exploiting cheap resources ND giving them little in return. We must renegotiate terms or completely withdraw from the WTFO – immediately! The World Trade Organization (WTFO): America Can No Longer Live With It The WTFO is a biased undemocratic organization of 153 nations that limits America’s ability to act in its own best interest. In it, the United States has no larger vote than a smaller country, such as Grenade (Article IX, p. 5).
By signing the agreement with the World Trade Organization, the U. S. Congress agreed to concede a major portion of our sovereignty and USUrp our democratic legislative process, including: Conforming U. S. Laws, regulations and administrative procedures to the will of the WTFO (Article XVI, p. 10) Subjecting all federal, state and local laws and practices that affect trade to international review by the WTFO (Article XVI, p. 10) Allowing any WTFO member country to challenge federal, state and local laws and practices as trade impeding (Section 2 of the Dispute Settlement Understanding) Taking all trade disputes to the WTFO judiciary – giving the WTFO final jurisdiction over all trade altercations.
No appeal exists outside of the WTFO (Section 2 of the Dispute Settlement Understanding) Empowering the WTFO to enforce its rulings by imposing fines on the United States until we comply Disallowing Congress to change the agreement. The Rights of America are Subservient to the Will of the World Trade Organization. Those who Signed this Lengthy Agreement did not Read the Fine Print or did not have the Interests of America in Mind. America’s WTFO Agreement MUST Be Amended or Eliminated! Amending the agreement with the WTFO requires submitting a proposal to the Ministerial Conference. Once the amendment has been accepted, it should only take 90 days to render a consensus. (Article X, p. 10).
If the United States opts to outdraw, the President would be required to send a letter to both the Congress and the Director General of the WTFO and we would be free of any obligations to the WTFO in six months (Article XV, p. 10). Until then, per Article VI of the United States Constitution, our agreement with the World Trade Organizations “shall be the Supreme Law of the Land; and the Judges in every State shall be bound thereby. ” UNDERSTANDING THE WTFO: THE Organizational-developed countries The WTFO recognizes as least-developed countries (Olds) those countries which have been designated as such by the United Nations. There are currently 48 least-developed countries on the UN list, 34 of which to date have become WTFO members.
These are: AngolaBangladeshBeninBurkina Absurdist Cambodia Central African Republic Coding, Democratic Republic of disambiguation Guanidine Visualization People’s Democratic RepublicLesothoMadagascarMalawiMaliMauritaniaMozambiqueMyanm- arNepalNigerRwandaSenegalSierra Lonesome’s IslandsTanzaniaTogoUgandaVanuatuYemenZambia Eight more least-developed countries are negotiating to join the WTFO. They are: Afghanistan, Bhutan, Comers, Equatorial Guiana, Ethiopia, HYPERLINK “http://YMMV. To. Org/English/tooth_e/sac_e/al_Liberia_e. HTML” Liberia,SAA Tom© & Principle, and Sudan. There are no WTFO definitions of “developed” or “developing” countries. Developing countries in the WTFO are designated on the basis of self-selection although this is not necessarily automatically accepted in all WTFO bodies.
ACCESSIONS Nepal The Kingdom of Nepal submitted, on 24 March, its acceptance of the terms and conditions of membership set out in the Accession Protocol which was approved by the Ministerial Conference on 11 September 2003 and signed by the Kingdom of Nepal subject to ratification. The Kingdom of Nepal became the 47th member of the WTFO on 23 April 2004. Nepal is the first OLD to join the WTFO through the full working party negotiation process. WTFO & Nepal Performance Appraisal Definitional to Flashcube’s to Favorites process by which a manager or consultant (1 ) examines and evaluates an employee’s work HYPERLINK “http://MN. Objectifications. Com/definition/behavior. HTML” behavior by comparing it with preset standards, (2) documents the results of the comparison, and (3) uses the results to provide feedback to the employee to show where improvements are needed and why. Performance appraisals are employed to determine who needs what training, and who will be promoted, demoted, retained, or fired. Performance Appraisal is the systematic evaluation of the performance of employees and to understand the abilities of a person for further growth and development. Performance appraisal is generally done in systematic ways which are as follows: The supervisors measure the pay of employees and compare it with targets and plans. The supervisor analyses the factors behind work performances of employees. The employers are in position to guide the employees for a better performance.
Objectives of Performance Appraisal Performance Appraisal can be done with following objectives in mind: To maintain records in order to determine compensation packages, wage structure, salaries raises, etc. To identify the strengths and weaknesses of employees to place right men on right job. To maintain and assess the potential present in a person for further growth and development. To provide a feedback to employees regarding their performance and related status. To provide a feedback to employees regarding their performance and related status. It serves as a basis for influencing working habits of the employees. To review and retain the promotional and other training programmers.
Advantages of Performance Appraisal It is said that performance appraisal is an investment for the company which can be justified by following advantages: Promotion: Performance Appraisal helps the supervisors to chalk out the promotion programmers for efficient employees. In this regards, inefficient workers can be dismissed or demoted in case. Compensation: Performance Appraisal helps in chalking out compensation packages for employees. Merit rating is possible through performance appraisal. Performance Appraisal tries to give worth to a performance. Compensation packages which includes bonus, high salary rates, extra benefits, allowances and pre-requisites are dependent on performance appraisal. The criteria should be merit rather than seniority.
Employees Development: The systematic procedure of performance appraisal helps the supervisors to frame training policies and programmers. It helps to analyses strengths and weaknesses of employees so that new jobs can be designed for efficient employees. It also helps in framing future development programmers. Selection Validation: Performance Appraisal helps the supervisors to understand the validity and importance of the selection reoccurred. The supervisors come to know the validity and thereby the strengths and weaknesses of selection procedure. Future changes in selection methods can be made in this regard. Communication: For an organization, effective communication between employees and employers is very important.
Through performance appraisal, communication can be sought for in the following ways: Through performance appraisal, the employers can understand and accept skills of subordinates. The subordinates can also understand and create a trust and confidence in superiors. It also helps in maintaining cordial and congenial labor management relationship. It develops the spirit of work and boosts the morale of employees. All the above factors ensure effective communication. Motivation: Performance appraisal serves as a motivation tool. Through evaluating performance of employees, a person’s efficiency can be determined if the targets are achieved. This very well motivates a person for better job and helps him to improve his performance in the future. Performance appraisal concepts and interpretations Transcript 1.
Performance Appraisal Performance Appraisal (PA) refers to all those procedures hat are used to evaluate the personality performance potential of its group members 2. Why Appraisals Are Important?? Set goals Set goals Recognize performance Recognize performance Guide progress Guide progress Identify problems Identify problems Improve performance Improve performance Discuss career advancement Discuss career advancement 3. Leads to competitiveness’s… Improving Making Strategy and correct performance behavior decisions Competitive advantage Values and Minimizing Ensuring behavior dissatisfaction legal and turnover compliance 4. Thus performance appraisal is unavoidable… 5.
Performance Appraisal : past-oriented methods Rating scale Confidential report Essay evaluation Critical incident method Checklists Forced choice method Behaviorally anchored rating scale Ranking 6. Past-oriented Methods Cont’d. Paired comparison method Forced distribution method Field review technique 7. Future-oriented Methods Management by objective 3600 Feedback Method Psychological Appraisals Assessment Centre 8. Rating scale The rating scale consist of several numerical scales, each representing a job related performance criterion such as dependability, initiative, output, attendance, attitude, co-operation and the like 9. Example:Employee name Dept Rater’s name 5 4 Date 3 Ex..
Good Acceptable Fair Poor 2 Dependability Initiative Overall output Attendance Attitude Cooperation Total score 10. Confidential Report Descriptive report Prepared by the employee’s immediate supervisor The report highlights the strengths and weaknesses of employees Prepared in Government organizations Does not offer any feedback to the employee 11. Essay Evaluation Method The rater is asked to express the strong as well as weak points of employee’s behavior The rater considers the employee’s : Job knowledge and potential Understanding of company’s orgasm, policies, objectives etc Relation with co-workers and supervisors Planning, organizing and controlling ability Attitude and perception 12.
Essay Evaluation This method has the following limitations: Highly subjective Supervisor may write biased essay Difficult to find effective writers A busy appraiser may write the essay hurriedly without assessing properly the actual performance of the worker If the appraiser takes a long time it becomes uneconomical from the view point of the firm 13. Critical Incident Technique Manager prepares lists of statements of very effective and ineffective behavior f an employee These critical incidents represent the outstanding or poor behavior of the employees The manager periodically records critical incidents of employee’s behavior 14. Critical Incident Technique Example: June 21 – Sales clerk patiently attended to the customers complaint.
He is polite, prompt, enthusiastic in solving the customers’ problem June 21 – The sales assistant stayed 45 minutes beyond his break during the busiest part of the day. He failed to answer store manager’s call thrice. He is lazy, negligent, stubborn and uninterested in work 15. Ex: A fire, sudden breakdown, satisfactoriness reaction scales informed the supervisor immediately B Become anxious on loss of output C tried to repair the machine D Complained for poor maintenance 1 16. Critical Incident Technique Limitation of this technique are: Negative incidents may be more noticeable than positive incidents. Results in very close supervision which may not be liked by the employee. The recording of incidents is a chore for the supervisor concerned who may be too busy or forget to do it. 17.
Checklist Checklist contains a list of statements on the basis of which the rater describes the on job performance of the employees Example: Is employee regular Y/ N Is employee respected by subordinate Y/N Is employee helpful YIN Does he follow instruction YIN Does he keep the equipment in order YIN 18. Behaviorally Anchored Rating Scale BARS represent a range of descriptive statements of behavior varying from the least to the most effective In this a rater is expected to indicate which behavior on each scale best describes an employee’s performance 19. Example:Performance Points Barometrically good 7 Can expect trainee to make valuable suggestions for increased sales and to have positive relationships with customers all over the county.
Restaurants, schools, and even prisons are feeding healthier - ECO Assignment introduction. More people want to be healthy and live healthier lifestyles. This paper will outline a plan for managers anticipating rising prices, examine the major effects the government have on production and employment, determine whether government regulations ensure fairness, examine the major complexities under expansion via capital projects, and lastly suggest how a company could create convergence between the interests of stock holders and managers. The Company aims to keep the prices of its products as inelastic as possible.
This means that the pricing strategy should have no impact on the way he consumers perceive and buy such products (Definition of Inelastic, (n. D. )). Generally we see such demand only in situations in which the good or services are indispensable and the consumers cannot do without the product. This is not the case for microwavable food products. The demand function for low calorie microwavable foods largely depends on the price of the merchandise, its relative (substitute) product, advertisement overheads and last but not the least on the income of the consumer.
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From the demand function and the elasticity considered, it is established that the market for the low calorie microwavable odds fit into a market of unapologetically competitive type. A monopolistic competitive is distinguished by a reasonable number of buyers and sellers. As a result people can change to another brand if a specific brand charges a soaring price. However, monopolistic competitive suppliers carry out product differentiation and consequently bringing in the consumers.
Now, Profit (NP) = Total Revenue (TRY) Total Cost (ETC) According to the FOCI of profit minimization, we get [Here P is not fixed] = MR. MAC=O From the elasticity as considered in the specified assignments, we can observe hat the demand for the low calorie microwavable manufactured goods is not very elastic in nature. Now, with the purpose to maintain their products as inelastic as feasible, the firm will attempt to differentiate its merchandise from other products of other firms.
If their product is dissimilar from others then the customers will not locate a substitute for that merchandise straightforwardly. That will formulate the demand for the equivalent product inelastic in character. We all are familiar with the fact that the larger the amount of product differentiation the larger the market power becomes. Consequently, it is sensible or the organization to carry out vigorous product differentiation to make the most of its profits. Examine the major effects that government policies have on production and employment.
Predict the potential effects that government policies could have on your company. Government involvement in the market economy Most people believe that regime must regulate the market. The only alternative to a regulated market is an unregulated market. Either a market is regulated or it is not. To some extent, there should be regime regulation/ intervention. Government regulation is needed. Too often, there is an urge to announce government as pointless or a waste, without considering that there are some things that government can do better than private industry.
Handling externalities, providing public goods (from national defense to public roads), enforcing contracts, and supplying a medium of exchange (that is, money); all of these are things that government can do better than private industry, simply by virtue of being a government (Callisthenic, 2008). There can and should be lots of discussion about where to draw the limits of government and what specific activities should fall within those limits? To argue hat, would one be better off with no government what so ever or is that just as reckless and shortsighted as arguing that the government should be in charge of every economic activity.
Neither one will result in an ideal economic climate. Two main reasons for government involvement in a market economy is establishing rules for exchange in markets and using that same power to enforce. Additionally, reducing economic uncertainty for people who are less fortunate due to poor health, bad luck, job losses, or other circumstances (Sullivan & Suffering, 2006). Overall, a market economy provides plenty of opportunities to people, but there are risks. Determine whether or not government regulation to ensure fairness in the low-calorie, frozen microwavable food industry is needed.
Cite the major reasons for government involvement in a market economy. Provide two (2) examples of government involvement in a similar market economy to support your response. The basic purpose of the government’s intervention to the market is the use of private and public goods, imperfect information, and whereby individuals are not the best judges of their own interest and are not able to figure out what will benefit the. The U. S. Government must fund things that are in society best interest overall.
The governmental intervention is required in the market economy because without it, the market would be close to being inefficient (Managerial- economics strategies). Mergers and monopoly through the market economy are highly possible creating opportunities for consumer exploitation through substandard goods and high prices. The government’s role in this case is to oversee the mergers and control the market to obscure monopoly creations. The essence of market economy is to achieve optimal capacity in production an specs that is likely to miss out where a monopoly exists.
Without government regulation, price stability is not achievable since, the increasing competition will lead to consistent low prices and thus price instability (Callisthenic, 2008). In a case where regulations in the market are lacking, lower quality goods will be introduced to reflect the low prices the market offers. The first example of government involvement in my opinion would be such as when the Government intervenes when firms are producing too many negative externalities such as a manufacturing plant producing smog that is causing some harm.
If this externally is causing no harm to the producer then the company will continue this action because there is no risk of consequence. According to Line (2004) China has smog that is so thick that the citizens are constantly wearing mask and forces to minimize any outdoor activities for goods. The vast majority of these goods are headed to the US where environmental laws and government enforcement is much stricter. The second example of government involvement is the need to regulate banking, and natural monopolies.
Our government has laws enforcing ability to protect the rights of average Americans from unfair business practices eke cartels. These same rights are what allowed to government to prosecute Dennis Kilos after he looted Tycoon of $600 million dollars (Thomas, 2004). Examine the major complexities that would arise under expansion via capital projects. Propose key actions that the company could take in order to prevent or address these complexities. Before a company considers mergers or expanding its operation, it will have to remember the reason for making this capital budgeting decision.
The main reason for a merger decision is to make sure the cost, risks, and benefits of the investment are worth getting into. The possible challenge for the need to raise capital is the source of capital. In this case, there is likely to emerge a power struggle between the company managers and shareholders. The managers’ easiest measure to raising capital would be to focus on the shareholders reserves. Raising capital in a corporation is not an easy measure to undertake (Xii, 2010). There are a number of items that need to be evaluated.
One is the cost of the capital, secondly the ease that the capital can be obtained and thirdly the expected return on capital. Here in the present situation, it has to be determined whether, the movie rental industry should ensure that, they should move forward with the merger and look to have self-expansion through capital projects (Michigan, Moyer, & Harris, 2011). If the organizations move forward with the activity of self-expansion, then, it shall not be possible for it to make sure that, it derives the benefits which would have been available to it if, the organizations might have had moved forward with the action of merger.
With the help of the merger, the movie rental industry can make sure that, they hare the technology and resources for achieving a higher level of profits. If the merger will not be conducted then, the organization will find it difficult in having a higher level of profits, as it shall continue to have the inefficient use of technology, resources, strategies and the financial commitments and incur losses (Callisthenic, 2008). In this way, it can be said that, the movie rental industry should move forward with merger rather than having self-expansion through capital projects.
Suggest the substantive manner in which the company could rate a convergence between the interests of stockholders and managers. Indicate the most likely impact to profitability of such a convergence. Provide two (2) examples of instances that support your response Conflict and convergence of managers and stockholder’s interests Fundamentally there are three forces that come together to create a convergence between the interest of stockholders and managers.
These include the strategic decision makers- Directors, Managers, Financial Commitment and Organizational Integration. Managers are known to have overall controlling interests over a company’s affair. Stockholders have limited control over the actions of the managers despite the fact that they are the owners (Managerial- economics strategies). Conflict between the two occurs when the parties seek to maximize their individual benefit. While the stockholders seek to maximize profits, managers will seek to higher incomes, and higher allowances.
Managers are likely to be against mergers as this compromise they job security. Stockholders will wish to minimize their risk by holding interest in as many business ventures as possible (Xii, 2010). Managers earning need to e pegged on their ability to raise high profits. This is where the pay package will increase by a percent of the profits raised in a financial period. This will guarantee that the interests of the stockholders are met since, higher profits mean higher dividend pay to the shares held (Sullivan & Suffering, 2006).
In the 21st century, both public and private business owners’ envisioned economic growth, but growth slowed when unethical leaders became preoccupied with satisfying their personal needs instead of the needs of their customers and their employees. Financial commitment requires that managers should have knowledge and control over the internal revenue of the company plus the outside finances available from donors and other financial institution to uphold the interest of shareholders (Sullivan & Suffering, 2006).
The stockholders will not be in any kind of problem or issue regarding the fact that, whether they should believe in the financial statements of the organization or not. The Securities and Exchange Commission requires the organizations to provide continuing information about their financial positions. The organization is required to be provided on a quarterly, half yearly and annual basis in order to ensure that, the results for the shareholders are better, and the shareholders get to know the true and the correct financial position of the organization in the future.
Traditionally, Blockbuster used to be a brick and mortar business model UT it has changed to become out-of-home DVD rental kiosks and also has an online rental and sale platform that delivers movies digitally and by mail - Eco Assignment introduction. The competition in the movie rental industry has grown significantly over the past 5 years. Back when Blockbuster was being started, Hollywood was the only competitor at the national and regional level but today, United States alone has over 500 registered movie rental companies.
Today, due to advancement in technology, movie rental companies are running away from the old methods of video renting and have now embraced internet as a business tool. With internet, movie Rental company are able to rent the videos where a customer pays using online merchants like Papal and the movie is delivered by mail or in one’s digital television. It is also worth to note that there is increasing number of video machines in major stores across US. Blockbuster Video in the past enjoyed monopolistic business model as they had a store at every town in US.
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Despite the fact that the company enjoyed the market alone, the number of stores made the company’s operation costs to rise which went so high to the extent of the company being declared bankrupt on September 23, 2010 (Blockbuster Entertainment Corporation. & Philip Life Group. , 2005). The rise in operation costs was due to the decrease in sales that can be associated with the increase in Internet use by the people where people preferred to stream online videos rather than visiting video rental shops.
Today’s market has come a long way and looks a lot different than it did when Blockbuster Video was at its best. There are now many competitors that fight for the consumer’s every dollar, but there are still a few dominant companies that stand out; Nettling and Amazon. Characteristics of monopoly structure are: profit minimization as there is only en firm that determines the price in the market, there only exist a single seller- this implies that the market is controlled by one firm and ideally, the firm is the same as the industry(Blockbuster Entertainment Corporation. Amp; Philip Life Group. , 2005). Initially, the retail stores located at various parts of the US were the major contributors of Blockbuster’s success. This was due to the fact that many people were able to access the movie rental services in their neighborhood. This attracted many customers as they could for the very first time rent a movie and return it to the store at a cost lower than that of archiving the very same movie. Like any other business, the main goal of Blockbuster is to generate more sales and hence making great profits.
With this in mind, the store has embraced the use of internet as a marketing tool and also a selling platform (Blockbuster Entertainment Corporation. ; Philip Life Group. , 2003). Today, many people prefer internet transactions as one-minute- shopping compared to driving many kilometers into “one-step” video shops. Another key factor that can’t be ignored is the “Guaranteed In-Stock” new movies and videos. Blockbuster’s online movie database is updated daily where new ivies are added into the system and made available for purchase.
It must be noted that the movie industry is time sensitive and unavailability of a new movie release on time can highly affect the number of sales. Also, in the short run, the company must be able to advance its technology-databases and their websites, as they are the pillars of company’s SUccess. The company must be prepared for various problems that might come with technology advancement. In the long run, creativity is paramount for sustainability of this company.
Blockbuster should come up with differentiated products as it has many competitors. Also, tit the availability of internet in every part of the world, the video and movie rental industry is expected to suffer a big blow, given the fact that the very same products they are providing at a given fee can be downloaded at a click of a button. Another factor is piracy issue. Today, many people own a personal computer with the ability to create DVD and CD copies.
This is a major threat to this industry in the long run and the company must come up with a way of restricting the same. As stated outlined above, the major factors affecting the operations of Blockbuster is the operation costs (licensing fees and labor costs). As indicated in the company’s annual report, one can tell that were it not for these costs, the video rental business would be making a big profit margin. It is therefore important if the company’s management can be able to come up with cost minimization strategies (Minter & Reid, 2006).
The manager must compare the performances of related companies like Apple and Nettling and be able to identify the weak points of Blockbuster Video. The managers must consider the prevailing prices in the market. Some of the major factors that affect the competitiveness in the movie rental industry are, bargaining rower of buyers, prevailing market prices and availability of other channels that provide the same products. As indicated above, internet is of major impact to the success of any movie rental company.
This is because it is the tools that can be used to target a wide range of customers, but also like in this case, it is used to provide free content (movies and videos) , a factor that is affecting the profitability of movie rental businesses. Blockbusters have embraced the use of internet not only in marketing, but also in providing their clients with access to movies after paying subscription fees through their on demand service. This has en advantage to them as they are able to target many clients as compared to other competitors.
Prevailing market prices, there is a difference in price ranges of firms within this industry but most competition cannot match because of adverting, popularity, and first mover advantage and clients loyalty. Product delivery duration is another factor that affects the client base of any movie rental industry, if a company’s delivery takes a long time, the clients might be attracted to other companies that deliver their products within a short duration. This is the factor that has contributed to many movie companies providing free shipping which takes at most 1 day.
Nettling and Apple are the two closest competitors of Blockbusters. These two companies have a different pricing method from blockbusters as they only major in subscription, though Apple has an added advantage as it has a marketing platform that is incorporated in all Apple devices such as Pads, Notebooks, and Phones and given the fact that Apple has many users and targets a specific class of people in the society, it has an added advantage over other companies (Unambiguous, 2009). I would recommend both subscription (monthly, lifetime, and yearly) and pay-per-download/ delivery models.
1 - Eco assignment introduction. Some games of strategy are cooperative. One example is deciding which side of the road to drive on. It doesn’t matter which side it is as long as everyone chooses the same side. Otherwise, everyone may get hurt.
More Essay Examples on Strategy Rubric
a. Does either player have a dominant strategy? Explain.
b. Is there Nash equilibrium in this game? Explain
c. Why this game is called a cooperative game?
a. What is the firm’s Total Revenue?
b. What is the Total Cost?
c. What is the firm’s Total Profits?
d. If the above monopolist were to behave like a perfectly competitive firm (operating in the long run), determine its output.
If D1 selects left then D2 will also select left and similarly if D1 Selects right then D2 will also select right. Therefore there is no dominant strategy prevailing
Both players minimize their loss by driving at the same side
It is called a cooperative game because both players can minimize losses while siding with each other. If they decide on a single side that is “left” for instance, both are better off and in the other case both will lose if they do not cooperate.