Using Empirical Research Evidence, Explain the Effects

Using empirical research evidence, explain the effects of one neurotransmitter on human behavior. Neurotransmitters are chemical messengers, which send signals and communicate information through neurons (nerve cells), cells, our brains and our bodies. Neurotransmitters are released and travel through terminals in the brain until they reach certain receptors. Neurotransmitters and their functions are located and carried out in different sections of the brain. It uses neurotransmitters to make your body carry out certain functions, such as making your heart beat and your lungs breathe.Scientists are not sure of how many neurotransmitters actually exist, but they can be sorted into two main different types. These are called exitatory neurotransmitters and inhibitory neurotransmitters. Exitatory neurotransmitters stimulate different parts of the brain. Three wellknown types of exitatory neurotransmitters are dopamine, norepinephrine, epinephrine. Inhibitory neurotransmitters calm the br ain and create balance. Three different types of inhibitory neurotransmitters are serotonin, gaba and dopamine.Although dopamine was already mentioned as an exitatory neurotransmitter, it is special because it is considered to be both exitatory and inhibitory. Dopamine affects the 5 different dopamine receptors: dopamine 1 (D1), dopamine 2 (D2), dopamine 3 (D3), dopamine 4 (D4) and dopamine 5 (D5), and helps to control parts of the brain that react to pleasure and reward. It helps the brain not only to see rewards, but to motivate a person to obtain those rewards, or at least try to move towards them. It also helps to motivate humans to perform the actions again, to acquire the same rewards.This involves activities such as eating, sex, and other such activities that create a rush of adrenaline. Along with that, dopamine also helps the body to move and have emotional responses to certain objects or situations. A lack of the dopamine neurotransmitter can have a number of negative effe cts, one main illness being Parkinson's disease. Also, people that are low in or lacking in dopamine activity are more likely to have addictions or become chemical dependent. When dopamine is not produced correctly in the frontal lobe of the brain, attention, focus, memory and the ability to analyse can all be negatively effected.The dopamine neurotransmitter can also effect people socially. Studies have shown that anxiety in social situations and a lack of dopamine 2 receptors can very often be linked, also, people with bipolar disorder are given drugs known as ‘anti-psychotics', which block dopamine, in an aim to reduce mania. A study was carried out on May the 2nd and was published in the Journal of Neuroscience. The scientists that worked on the study included a team of Vanderbilt University scientists, medicine student Michael Treadway and professor of psychology, David Zald.The aim of the experiment, was to test whether ambitious and hard working ‘go getters' in th e workplace, who were willing and able to work hard to obtain the reward they want, had a different level of dopamine release in the brain (or certain parts of the brain), than workers that tended to slack off more and were less willing to work towards obtaining a reward. The team of scientists used a Positron emission tomography (or PET scan), which is a medical imaging technique, used to produce 3D images of functions taking place in the brain, and other parts of the body.The scientists discovered that the ambitious workers, working towards a reward, had a larger release of the dopamine neurotransmitter in the parts of the brain that, studies have shown, are linked to motivation and obtaining reward. These parts of the brain are called the striatum and the ventromedial prefrontal cortex. Not only did they find out this, but they also uncovered that less motivated people in the workplace had a high release of dopamine also, but in a completely different part of the brain. This dopa mine release was happening in the anterior insula of the brain, which is the section that is linked to emotion and risk perception.Many different types of studies have proven that dopamine affects going after rewards, and motivation in the brain, but the speciality of this particular study is that it proves that dopamine is not only linked to rewards in hardworkers, but also can be linked to emotions and risk perception in less ambitious workers. This empirical research study clearly shows that dopamine has an affect on human behaviour by effecting the ambition, or lack of it, in the workplace when it comes to working towards reaching a goal and obtaining a certain reward.

Application Software

LP2 Assignment: Applications Software Managing Information Systems David Khuong National American University Author Note This paper was prepared for Managing Information Systems, Course ID: MT3500/CI3510, taught by Dr. Kim Eastern LP2 Assignment: Applications Software The three primary features commonly used applications software that will be summarized in this paper are personal application software, workgroup application software, and enterprise application software.Personal Application Software’s 1) Word processing; helps create, edit and print text documents. I. e. , Microsoft word, Corel WordPerfect, Google Docs, Apple Pages and Sun Writer. 2) Spreadsheet; provides a wide range of built-in functions for statistical, financial, logical, database, graphics, and date and time calculations. I. e. , Microsoft Excel, IBM Lotus 1-2-3, Google Spreadsheet, Apple Numbers and Sun Calc. 3) Database; stores, manipulate, and retrieve data.I. e. , Microsoft Access, IBM Lotus Approach, B orland dBASE, and Sun Base. 4) Graphics; develop graphs, illustrations, and drawings. I. e. , Adobe Illustrator and Adobe FreeHand. 5) Project management; plans, schedule, allocate, and control people and resources needed to complete a project according to schedule. 6) Financial management; provides income and expense tracking and reporting to monitor and plan budgets. I. e. , Intuit Quicken. ) Desktop publishing; use with personal computers and high-resolution printers to create high-quality printed output, including text and graphics, various styles of pages can be laid out; art and text files from other programs can also be integrated into published pages. I. e. , Quark Xpress, Microsoft Publisher, Adobe PageMaker, Corel Ventura Publisher, and Apple Pages. Workgroup Application Software Support local and international teamwork and utilizes groupware; software that helps groups of people work together more effectively.Groupware is defined by Ernst & Young’s rules â€Å"Thr ee Cs†. * Convenient; if it’s too hard to use, it’s not used; it should be as easy to use as the telephone. * Content; it must provide a constant stream of rich, relevant, and personalized content. * Coverage; if it isn’t conveniently accessible, it might never be used. Enterprise Application Software * Software developed to benefit the entire organization. * (ERP) Enterprise resource planning software; set of integrated programs that manage a company’s critical business operations for an national and international organization. Application software is integral for information Decision Support, and Specialized Purposes. Overall the application software applies the power of the computer to solve problems and perform specific tasks throughout the organization from personal, local to global level. References Fundamentals of Information Systems, Sixth Edition. Chapter 2, Hardware and Software. Retrieved from: https://online. national. edu/d2l/lms/conten t/viewer/main_frame. d2l? ou=20924&tId=921805

Malcolm Baldrige and the Evolution of Total Quality Management Essay

Quality and productivity can be considered mutually inclusive. An organization that aims for quality will eventually results to better productivity in the concept of services, goods being produced, personnel and human resources development, not to mention capital gain, increase in competitiveness, and increase in investment opportunities. Though it may be a good concept, a governing body should be present to determine the necessary criteria and set for definitive standards to follow. In the United States, the two governing body in quality standard award are the Ron Brown Award and the Malcolm Baldrige National Quality Award. Malcolm Baldrige, a U. S. Secretary of Commerce during the era of the Reagan Administration, is the one responsible for organizing a conference on productivity in the White House. Apparently, he initiated the conception and blueprint in 1987 of the Malcolm Baldrige National Quality Award: which focuses on quality. The award, through the National Quality Improvement Act of 1987 (Public Law 100-107), gives emphasis on quality services being given by different sectors such as education, health care, business, and non-profit organizations (Marion p. 1). These quality services are based on the practices of the Total Quality Management System (TQM) principles and contain seven criteria to determine the awardees: Leadership, Strategic Planning, Market and Customer Focus; Measurement, Analysis and Knowledge Management, Focus on Workforce, Process Management, and Results. These criteria are considered significant to U. S. competitiveness in terms of improving the capabilities, practices, and results of an organization; sharing and facilitating the most excellent practice among the different sectors; and to serve as a working tool guide for planning and managing. Most of these criteria are taken from the principles and techniques in quality management developed by Philip Crosby, W. Demings, Armand Feigenbaum, and Joseph Juran. Moreover, the award aims to promote significant level of quality consciousness; to be able to distinguish the achievements of U. S. companies in the context of quality; and to make available to the public the thriving strategies on quality. The process of selecting the winner involves an assessment of the written examination submitted by the applicant, a site visit on the company (provided that the company achieved a high score), and a final evaluation. Since the Malcolm Award is based on the principle of Total Quality Management, the system have evolved or developed in terms of the factors in performance measurement that includes the following: operating or in service measures, employee relationship, satisfaction of customers, and performance on financial aspects. For instance, based on the data of the 12 Companies that submitted their respective pertinent data for evaluation, on an annual basis product reliability increased by around 11. 3 %; the time of processing the order is reduced annually by 12% on the six companies; product errors and defects decreased by 10. 3% on the seven companies; and around five companies have reduced cost by 9%. This created a savings of around $1 Million to $115 Million. Aside from the improvement on the factors on performance measurement, indicators of employee relationship also improved. Employee satisfaction improved by 1. 4%, employee turnover (voluntary request for separation) decreased by around 6%, health and safety measures improved by 1. 8%, and the accumulated total-quality suggestions made by the employees increased by 16. 6%. The total customer satisfaction also increased by 2. 5% with complaints coming from the customer being reduced by 11. 6% and retention of customers also improved by 1%. Market share is increased by 13. 7% and the return of assets by 1. 3% (Shetty p. 4-6). Thus, Total Quality Management had eventually improved in terms of quality, customer satisfaction, and reduction in cost. Furthermore, the Total Quality Management System had an affirmative impact on all of the significant areas of concerns: improvement in product reliability, increased in customer satisfaction and responsiveness, and reduction in cost. Apparently related to these are the increase in job satisfaction, improvement of health and safety measures, and reduction in employee turnover. This improvement and reduction on specific areas will eventually yield to increase in the market share, profitability, and quality. The result of such will also produced a certain degree of competitive advantage, which is eventually acquired as a result of committing to quality. A firm competitive position will give the company a unique place in the market wherein the consumers are willing to pay for the product, and the established quality will become difficult to surmount by the competing companies. Another factor to consider in achieving a competitive advantage is through the reduction of cost by improving quality. Reducing cost is synonymous to reduction of the in-process work inventory, handling of materials, capitals on equipment and maintenance, thus reducing claims on liability. The reduced costs will in-turn lead to a higher profit margin, increase in the sales, and lower prices of the product. Therefore, cost and quality are the most important factors to achieve a competitive advantage and these can be realized through the implementation of Total Quality Management System. The implementation of the Total Quality Management depends on the need and the nature of the business. Companies that adopted a TQM, and subsequently succeeded on all areas described above still have to continue on developing the system. It is considered a continuous process and development. Different sectors of the industry such as in the health care, manufacturing, services, and small businesses are becoming more aware of the positive impact of adopting TQM, and the aspiration of being recognized as one of the Malcolm Baldrige National Quality Awardees set forth the scene to a strong commitment towards excellence in management quality and company performance. The Award started at 1988 and after 20 years, around 79 companies are recognized. The impact of adopting the criteria of Malcolm Baldrige through the implementation of TQM had significantly produced quality and productivity to several companies such as: The ADAC Laboratories, Custom Research Inc. , Dana Commercial Credit Corp. , and Trident Position Manufacturing Inc. (Malcolm Baldrige recipients of 1996). Of these four, Trident and Custom Research belongs to the small business category, ADAC in the manufacturing sector, and Dana Commercial on services. The ADAC Laboratories, founded in 1970, have its product line in the design, manufacturing, marketing, and support intended for customers belonging in the health care sector such as in radiation therapy, information system in health care, and nuclear medicines. These services and products are sold to universities, hospitals, and clinics worldwide. The impact of adopting the criteria of Malcolm Baldrige has significantly improved the company’s market share (12% in 1990 to 50% in 1996), and customer satisfaction (no. 1 ranking). Before, the company was only focused on short-term financial goals, and not totally oriented towards attaining a quality firm for investors and customer’s satisfaction, and employee development. Determined to over-turn the current situation, the company adopted the criteria of Malcolm Baldrige. In 1994, ADAC applied for the Malcolm Baldrige getting up to the 2nd level (site visit). The site visit consequently gave the company a feedback assessment with around 148 areas of concerns that needs improvement. The company then utilized the feedback report as an external resource to eliminate the gaps. The management team attended the Center for Quality of Management, a consortium of experts in the field of Total Quality Management. The intensive two-day training made all employees understands the four relevant thoughts: shared learning, total involvement, focus on customer, and continuous development. Consequently, the turn-around of the company to focus on customer satisfaction had lead to a strong rate of retention with 94% as compared to the previous 50%; market share increased by 50% as compared to 12% six years ago; and the revenue per worker increased by around 75% (Marion p. 1). The results by adopting the criteria verified the kind of quality management the company had developed with emphasis on quality and excellence. Dana Commercial Credit Corporation, a subsidiary of Dana Corp. , provides financing and leasing services to a wide range of businesses and specific markets. Located at different offices such as in Canada, United Kingdom, and Ohio; the company have activities that includes management of assets services, combined-venture leasing consortium, and leasing of equipment for manufacturers and dealers. The company decided to apply for the Malcolm Baldrige Award for two compelling reasons: after receiving the Dana Quality Leadership award, the company intended to benchmark it alongside the Malcolm Baldrige; and the challenge of pursuing the Baldrige award will provide a significant â€Å"push† towards a fast improvement in quality for the company. Making through the process of the Baldrige criteria eventually created a strong culture with emphasis on service quality and customer satisfaction. In return, the morale of the employees is high as well as the profit. Custom Research Inc. is one of the small firms that received the Baldrige Award that clearly shows that no matter what the size of the company, better quality management can also be achieved just like those of multinational companies. Established in 1974 by Jeff Pope and Corson, CRI caters big companies in designing and conducting projects that can provide relevant information to make effective decisions in business. The main office is located at Minneapolis with several offices in Ridgewood and San Francisco, and New Jersey. In 1998, the company had reduced its client from 138 to 67, primarily to provide better service as well as establish partnership with their biggest clients. From 1992 to 1994, the company had applied for an assessment to Baldrige and reached the site visit level three times. After receiving the Minnesota Award for Quality in 1995, CRI decided to re-apply again for the Baldrige since the award was patterned to it. Winning the state award had helped the company achieving its goal to be awarded by Baldrige in 1996. Since the employees are less, all took part during the application and assessment process wherein each employee knows the whole process, the criteria, and how it is should be implemented in their respective field of work. Thus, the Baldrige Award had greatly influenced all employees towards achieving quality and productivity creating a positive atmosphere to the company. In return, the employees are all motivated that results to better business opportunities and results. Trident Precision Manufacturing Inc. is a private company that manufactures various components of sheet metal (precision), customized products, and assemblies (electromechanical). With its lone manufacturing plant in New York, the Company developed processes and tooling to manufacture and assemble components intended for the different sectors of the industry such as in equipment used in office, banks, health care, and even defense. Trident began to exploit the criteria of Baldrige in their quest for quality in 1989. The criteria had served as an open window to know the areas of weaknesses and strength of the company. April Lusk, Trident’s administrator for quality, emphasized that the biggest significant asset of the Baldrige Quality Award process was the feedback report, which stands for an unbiased assessment of a company’s strength and weaknesses. Trident then utilized those feedback reports to narrow the gaps and eventually achieved better results: due to a strong focus in customer satisfaction, the company has been able to maintain its position as the main supplier to chief customers even though it reduced their supplier percentage to 65%; the focus on employee involvement also played a major role achieving a 100% employee participation on departmental occupation team, around 95% of the improvement on processes have been established, the recognitions and rewards for the employees increased, employee turnover decreased, and the company have invested 4. 6% of the payroll towards education and training (Marion p. 1). The continuous improvement of the employee, their commitment to the internal and external clientele, and the eventual â€Å"control† of their processes have made Trident to stand out and establish a dedication towards excellence and quality. More so, Trident’s strong affirmation towards an environment that is family oriented, continuous effort for improvement, and teamwork are the main factors the Baldrige Award considered. Responsibilities are shared, suggestions considered and implemented so as to create an environment where the employees are satisfied and their morale is high, resulting to a stronger and a healthier business. The background discussed on the four companies clearly illustrated the impact of implementing the principles of Total Quality Management System through the Malcolm Baldrige Quality Awards. These companies aspired to achieve the Baldrige Award and the results improved the company’s overall quality and productivity program, as well as their business status and competitiveness. By analyzing the stories behind each success of a company towards achieving the Malcolm Baldrige Quality Awards, several key pointers should be emphasize such as the following: Leadership also plays an important role towards attaining quality. Top management should exert effort in terms of leadership and support since the adherence to quality usually accompanies changes in the company’s operating systems or philosophy. Clear goals should be determined as well as a positive atmosphere or culture to encourage the employees to attain such goals. The presence of a highly motivated staff or employees also has significant contributions towards attaining quality. Quality depends on the employee’s efficiency, and subsequently to the employees work motivation. It also encompasses all the aspect of human resources such as employee training and recruitment program, job descriptions, and rewarding as well as empowering employees. Employee involvement are considered an important aspect, and also the encouragement of a corporate vision towards quality-related improvement activities and programs may require several major adjustments or changes the way the employees are being managed (Shetty p. 6) Another factor that is significant is the aim for a total customer satisfaction. Realizing this vision will create an effort towards improving quality. Exceptional external and internal systems are necessary to supervise customer satisfaction through the use of surveys, evaluation of services and products, and investigation of complaints (Reiman p.11) Analysis of information is also critical since this will serve as a basis on making corporate decisions and adjustments. Efficient and complete data gathering serves as a powerful tool for the company since these will reflect the strengths, weaknesses, goals, quality, and service standards, to name a few. Suppliers also have a significant role in the pursuit of quality. Usually, successful companies develop long-lasting relationships with suppliers having a vision for quality. The company relatively engages the suppliers to become an integral part of the firm’s TQM. Consultations, trainings, and continuing contracts are some of the ways the company engages the suppliers on its TQM program. Thus, the suppliers become a partner in administering quality efforts, which in turn have major effects on how the suppliers are conventionally managed. The commitment to quality is a boundless process; therefore, a continuous program for improvement and development should be implemented. The results on the companies that implemented the Total Quality Management System in pursuit of achieving the Malcolm Baldrige National Quality Awards proved to be a success. The end-results created better customers satisfaction, high morale of employees, reduced cost, decreased on employee turn-over, good competitive advantage, improved health and safety measures, better production processes, increased in market share and profits, quality and productivity. The Malcolm Baldrige Award provides a vast range of quality concerns. The feedbacks made by the Award committee can be use by the company to narrow the relevant gaps, which are based on the findings. The award served as an effective guide with respect on streamlining the business and management practices. The criteria set forth by Baldrige, based on the principles of Total Quality Management, provided the significant standards of excellence to achieve quality and productivity.The award served as an effective catalyst to strengthen and improve the company’s competitiveness. Works Cited Shetty, Y. K. â€Å"The Quest for Quality Excellence: Lessons from the Malcolm Baldrige Quality Award†. Sam Advanced Management Journal. 22 March 1993: 1-14 Harmon, Marion. www. qualitydigest. com. Jan. 1997. Retrieved April 23, 2009. http://www. qualitydigest. com/jan97/baldrige. html Reiman, Curt W. â€Å"Winning Strategies for the Malcolm Baldrige Award,† Journal of Quality Management, July 1990, pp. 9-25.

If you were to win the lottery describe what would you do with the Essay

If you were to win the lottery describe what would you do with the winning share and why - Essay Example ture plans for travelling around the world and buying expensive cars and portray a spontaneous way of life but conversely I will try and make sure to secure my future with potential investments first, and I would dedicate a fair share of my money to my family and friends who have been part of my life through all the rough patches that I have been through. I will try to stay focused during all the decisions because I wouldn’t want this earning to turn into a nightmare of choices and bad decisions for me. The most vital role play in everybody’s life is associated with their family and friends. For my family and friends who mean the whole world to me, I will try to give them enough money that would cater their indigents for the rest of their lives. I would make sure that the needs and wants of my family and friends are well tended to. As far as my personal needs are concerned I will try to be as much coherent as possible in my investments and I would wish to continue a healthy life style that avoids any drug addictions or buying myself useless gadgets and expensive items that take up a lot of money and it does not bring any real change to my life except for a social status symbolic value. Though the choice of buying a well furnished home with renovated furniture and adorable location is on my list and I will make sure I follow through that list entirely. I will also want to some social charity work as well in the form of donations because after all we live and share the same so ciety and community hence I will try to be part of any social cause that would help eradicate some social issues or to say in particular a â€Å"disease†. As far as my investments are concerned I will make cautious investment and craft a diversified portfolio of investments that take care of my future one way or the other. I will try to make sure that I don’t end up like any of the earlier winners of such lotteries whose lives were turned into a nightmare after hitting the jackpot with

RFP Correspondence management system Essay Example | Topics and Well Written Essays - 1000 words

RFP Correspondence management system - Essay Example Reducing the number of steps the correspondences/documents go through in their path till they reach their final destination. This should be fixed by creating a user friendly interface where many easy to identify icons are placed for the user to assign task and route documents for action. Saving time and effort through giving the ability to trace the correspondences/documents state in terms of knowing their location in the department(s), who is the person responsible to take actions against them, delays, bottleneck etc†¦ Create Adobe PDF files for archiving and auditing and send the files to a preferred location for easy access when required. It also maintains an audit trail at each phase of the material management process. Provide post go-live support for 3 year for system maintenance and administration. This is to ensure that the system is updated to tailor upcoming needs and errors unforeseen during system development are corrected. All bidders to provide list of staff of those will be working in the project and proposed organization chart. Bidder should provide CVs with the proposal for Project Manager and system architects, web designers and developers for DEWA review and approval. Bidders shall be responsible to ensure that their company, solution providers, developers, sub-contractors, and suppliersare capableto satisfactorily meet the project requirements. This shall be done prior to submitting proposal to DEWA. In making the selection, DEWA will not be bound to award the tender to the lowest bidder. DEWA will take into consideration the prices offered, features and technology offered, proposed designs, delivery dates, cost for training and maintenance or any other elements which could affect the final cost to DEWA and the suitability of the solution. DEWA reserves the right to request the bidders to arrange for a demonstration/trainingto better

International development studies midterm Essay

International development studies midterm - Essay Example Chronic poverty, on the other hand is the poverty that persists in a people’s lifetime (Hulme and Shepherd, 403). According to the world poverty index, extreme poverty is experienced when a person spends less than one dollar a day in both expenditure and consumption. Severe poverty, nevertheless, involves spending less than 0.7 dollars a day. Chronic poverty combines these two poverty lines and often transmits this style to generations that follow. Globalization involves the rapid and equal growth of the entire world through mechanisms that enhance interaction, trade and therefore enhancing global prosperity. With the existence of chronic poverty, many developing countries find it difficult to provide quality health services to the many citizens who live in impoverished states. The globalization trend aims at encouraging foreign investments in an individual country, and this has been the trend for many developing countries. Pushed by the need to provide employment and improve the tax revenue for provision of quality social services to the populations, many developing countries have embraced foreign investments from the first class economies. These investors are well aware of the desperate state of the poor people in these countries, hence putting in place industries that are labor intensive but offering poor remuneration for the laborers working in these industries. This represents inequality in the treatment of the markets, as in foreign countries the working conditions are adhered to buy the foreign investors (Ellis, 15). However, globalization helps in creating the much-needed social assistance that involves elevating the poorest people towards achieving better living standards. With the rise in globalization, the poor people are able to receive income that is in turn generated towards investment programs that are initiated by the foreign investments. Besides, the investments by foreign companies in developing countries enables these countries to

THEORY OF FINANCIAL INSTITUTIONS AND POLICY Assignment

THEORY OF FINANCIAL INSTITUTIONS AND POLICY - Assignment Example Means by which managers can accomplish their malign interest is through compensation plan, perks, bonuses, travelling on corporate expenditure and scamming against the corporation. Introduction to Balance Sheet Approach: In order to check the quality of earnings two approaches are predominantly used, one of these approaches in balance-sheet approach. The aim of this approach is to assess the true magnitude of accruals because it is these accruals which lead to manipulative earnings (Aghion, Bacchetta, and Banerjee, 2004). Thus it is of utmost importance to locate them and rectify the manipulative action to see the true picture of the organization. As a general rule the higher the total accruals are as compared to percentage of assets, the greater the likelihood that earnings quality is low. Remember that accruals can be either a reflection of earnings manipulation or just normal accounting estimations based on future business expectations. It is difficult to determine which one is dr iving the accruals, but there is evidence that the size of accruals can be used as a rough measure for earnings manipulation (Mulder, Perrelli, and Rocha, 2012). Following are the series of formulas that are used to find the real values of accruals (Pasiouras, 2008): 1. Total Net Accruals = Accrual Earnings - Cash Earnings But the balance sheet doesn't directly tell us what accrual earnings were in the period, so further calculations are required to retrieve this information.   2. End Equity = Start Equity + Accrual Earnings - Cash Dividends - Stock Repurchases + Equity Issuances 3. Accrual Earnings =  ? Owners' Equity + Cash Dividends + Stock Repurchases - Equity Issuance = ? Owners' Equity + Net Cash Distributions to Equity 4. Accrual Earnings = ? Assets – ? Liabilities + Net Cash Distributions to Equity 5. Cash Earnings = ? Cash + Cash Dividends + Stock Repurchases - Equity Issuance = ? Cash + Net Cash Distributions to Equity 6. Total Net Accruals = Accrual Earnings - Cash Earnings = [? Assets – ? Liabilities + Net Cash Dist. to Equity] - [? Cash + Net Cash Dist. to Equity] 7. Total Net Accruals = ? Assets- ? Liabilities – ? Cash Reasons for the World Recession: Suppressing Demand of the World Market, leading to declining industrial growth and output, which further results in a negative mood spreading amongst the investors and a negative posture taken up by the overall economy (Torna and DeYoung, 2012). In the United States a housing bubble was being propelled by speculative behaviour. This speculative behaviour was fuelling the U.S economy. Federal Reserve’s irresponsible action to lower the interest rates encouraged a large inflow of foreign funds. This availability led to the creation of easy credit for borrowers, who started taking hefty home loans. As the demand for home loans soared this created an artificial demand in the housing market and an artificial price hike in the housing market. Since there was ample amount of money available in the economy the mortgage lenders started lending at an exponential rate and simultaneously lowered their lending standards. Such conditions helped individuals with poor credit history and those who made the NINJA category (No Income, No Job, No Assets), receive hefty amount of loan from the loan agencies for whatever purpose they see fit (Broeck and Guscina, 2011). Since the property market was on a role and was flushed with money, leading to

Case study, starbucks corporation Study Example | Topics and Well Written Essays - 750 words

, starbucks corporation - Case Study Example The mission statement of a company is a very important tool in its marketing. Starbucks mission states "to inspire and nurture the human spirit-one person, one cup and one neighborhood at a time" (Grundey, 2010). In other words, the company did not focus on serving great coffee but to have the customers engaged at emotional level. As explained by one of the company’s most successful managers, one that saw the most positive change in the success of the company, Starbucks was not in the coffee business to serve people but in the people business to serve coffee (Levi & Linton, 2003). In other words, the company sought to create a home away from home such that people had another place other than their workplace or their home where they could socialize and share their experiences as they drunk excellent coffee. It puts a lot of emphasis on sourcing the best coffee from the market. The company promoted not only the lives of those who supplied the coffee but roasted the coffee to ensure that its quality was superb. Maintaining topnotch quality coffee berries and proper manufacturing meant that people could bet on continued quality of the drink. That way, the stores remained favorite spots for the people. Starbucks also focused on employee involvement. In other words, there had to be a good environment for the customers whenever they visited the coffee shop. For this reason, the employees had to be excellent team members and had to be above average in terms of customer relations. Unlike most companies today, Starbucks did not focus on profits only. The company takes seriously the virtue of good neighborhood. In the stores, it did not matter the customers background or their color of the skin. Starbucks focused on being good to the community at large and to bring together partners, customers, and the whole community. Starbucks strategies had a lot of impact on the performance of the company. It is normal for some companies

What the new expatriates should expect with leaders from another Essay

What the new expatriates should expect with leaders from another countries - Essay Example Ladies and gentlemen, as I stated just now globalization has brought us closer with each passing day and same has been the case among the nations – spread across the world’s horizon. We might have a definitive understanding of the American nation but then again little do we know about the kind of leadership prevalent within Brazil, Italy, India, Germany, Denmark and Australia. Thus these seven nations have so much in common but when it comes to an understanding of their leadership regimes and the like, we fall short on gaining that ground. Let us kick off with how the American leadership shapes up. America, as we all know is the super power of the world and hence the influence it has on the fraternity of nations is somewhat demanding. It wants to build relationships with the rest of the worldly nations only on the premise that they are willing to listen to what the American leadership has to say. As expatriates, you should know beforehand that American leaders are willing to listen yet they do what they deem best for their country, organization or society. As decision makers, they take all steps after going through each and every stage of the decision making cycle as the pros and cons are studied in an incisive manner. (Barber, 1988) They treat their subordinates with respect and dignity and reward them for their work and commitment. In a global workplace, communication holds the key and America, of all the nations has this advantage of understanding the different dialects and languages of the expatriates coming from different regions of the world. America is on the move and so is their leadership hierarchy – they are striving to achieve more and more through the means of diversity, rest assured. Moving on towards Brazil ladies and gentlemen, we take a look at the way this South American nation has progressed over the years. The Brazilian

Equity & Trust Essay Example | Topics and Well Written Essays - 2500 words

Equity & Trust - Essay Example It has to be understood that the term 'Law' implies an act enacted and passed in Parliament (statutory law) and the common law (principles established by judges in previous trials, procedures and conclusions) in the process of deciding on litigations. The most important dissimilarity between law and equity is the difference in remedies that both offer. While laws equip the court with the necessary set of instructions that enable the court to draw monetary compensations for the damages cased to the plaintiff, the equity enables the court to order injunctions or decrees that direct someone to act or not to act in some particular manner. Often, it is this form of order that is more practical to the plaintiff and provides more convenient remedies to the sort of problems raised by the plaintiff in the court of law. A plaintiff who has lost his baggage in a particular place may seek to get it back from the place and not the monetary value of the contents of the baggage. What marks the distinction between an equity and a law is the non-availability of a jury in the former. Equitable remedies can be decided upon exclusively by a judge, as it is a matter of law and not subject to intervention. Hence the intervention of a jury as a trier of facts is impossible to come by. Legal and equitable remedies are thus distinct in their nature and scope and this factor is well deliberated upon in modern legal systems of progressive states such as the United States of America. The right of trial by jury in a civil dispute in the United State is governed by the Seventh Amendment of the American Constitution. Hence the question of a trial by jury depends on the nature of relief the plaintiff has sought in his prayer before the court. If he is seeking a monetary benefit in lieu of the wrongs done to him, the matter can be decided upon by a jury since the matter is considered legal. But is cases where the prayer is for specific performance or non-performance, and areas where the intended award is an injunction, declaratory judgment, modification of contract etc., then the matter is treated to be solved by equity. Hence in such areas, the jury is not allowed. The foremost distinction between a law and equity is the source of the governing rules from which the decisions are arrived at. In law, the decisions are derived from a set of governing rules that are well laid out in long hand and approved by the government. Where as in the case of equity, it only has general guidelines known as the maxims on equity. It is due to this factor that the equity is deeply rooted on fairness and flexibility. An important criticism that equity has is that since there are no prior written guidelines, the lord chancellor can give a ruling according to his conscience. This open endedness led to the wrapping up of the provision and its being included in to a consolidated system of precedents much like its cousin - the Common Law by the 17th century. History of Equities and Trust The distinction betwe

Building successful parent-teacher partnerships Essay Example for Free

Building successful parent-teacher partnerships Essay The problems in the school life can be solved if teachers and parents work together as a team. â€Å"The traditional concept of involving parents in the process of educating their children has typically been restricted to one-way communication approaches. Either the parent is talking at the teacher or the teacher is talking to the parent. Yet the real purpose of parental involvement in the educational process is to foster an improved learning climate and support system for the child. Parent-teacher confrontation models do little to foster the development of their environments conducive to effective interaction and learning for the child† (Swick, 7). â€Å"parents and teachers must come to realize that their behaviors are much more important than their words in affecting the child’s self-concept. When parents and teachers work in complementary, supportive type roles as partners in the development of learning climates and support systems for young children, not only are they learning, but they are a vital part of the educational process† (Swick, 7). â€Å"†¦ the parent is the first and most important influence in the child’s development. It holds that the parent, like all other teachers,must first be a growing, compassionate person in order to be an effective parent† (Swick, 7). â€Å"Parents and teachers become stronger, more insightful individuals when they participate in joint determination of the educational program in which their children have optimal conditions necessary for growth toward becoming functional and developing persons† (Swick, 8). Parents provide personal information about children’s behaviors, characteristics, talents, interests, etc. Teachers give another view about the social development of the children for example with friends and other people, progresses in school, skills, achievements, etc. Involved parents: The hidden resource in their childrens education by Anita Gurian, Ph.D. Gurian, Anita. â€Å"Involved Parents: The Hidden Resource in Their Children’s Education† NYU Child Study Center. Available: 01 May 2012. Web Page. â€Å"In adolescence, children become more independent and usually don’t want their parents in school. In middle and high school, students have to deal with more courses and more teachers in a more impersonal way, so parent involvement, although less direct, is still critical. Parents can participate in events at school, monitor homework, provide experiences and materials that supplement course work, and help children with organizational strategies. Parents can influence their children’s academic progress by encouragement, reinforcement, and modeling. Children learn from their parents’ own learning styles and activities, such as discussions, newspapers and other reading materials, television habits and quests for information and knowledge.† When parents want to be in charge and spent their time for their children, they can have the opportunity to know their child’s life better. The parents can know the social life of their children at school and all the other activities that their children have. United States. Office of Educational Research and Improvement. National Center for Education Statistics. Parent Involvement in Children’s Education: Efforts by Public Elementary Schools. Washington, DC, 1998. Internet. â€Å"Parent attendance at school-sponsored events was related to the concentration of poverty in the school, as defined by the percent of students eligible for free or reduced-price lunch. In general, as the concentration of poverty in the school increased, reports of high parent attendance decreased. For example, while 72 percent of schools with a low concentration of poverty reported that most or all parents attended the school open house, 48 percent of schools with a moderate poverty concentration, and 28 percent of schools with a high poverty concentration reported that most or all parents attended the open house† (Carey, 14). Davis, Jonathan. â€Å"Facilitator Helps Parents Get Involved in Their Children’s Education.† NBC 26 News. (25 April 2012). Available: 1 May 2012. Web Page. In order for a school to run efficiently you need to have the parents involved. I try my best to communicate that to the community and let them know that we have things that they can do, Like being a room mom and are able to give back to the school. In order to do that you have to have the parents to get involved because we want lifelong learners, said Inga Coleman.

Jean Piaget Essay Example for Free

Jean Piaget Essay My own beliefs about early childhood education are based upon the knowledge that childrens growth is developmental. It seems very clear to me that a high quality early childhood program must provide a safe and nurturing environment which promotes a broad spectrum of support for the childs physical, social, emotional, and cognitive development. I strongly agree with the tenets of the National Association for the Education of Young childrenthat high quality, developmentally appropriate programs should be available to all children (Bredekamp Rosegrant, 1992, p. 7). Children under the age of eight have enormous potential for growth and achievement, and it is my belief that they have rights to fulfill their possibilities. A separate statement of the NAEYC divides the concept of appropriateness into two aspectsage appropriateness and individual appropriateness (Bredekamp, 1987, p. 2). This statement coincides with my belief that children are unique individuals who may or may not reflect the usual characteristics of other children of their same age. Furthermore, I believe that a developmentally appropriate curriculum for young children is correctly tailored to the specifics of each age group. Different ages have different needs, interests, and developmental tasks, and the curriculum should reflect those variations. The most effective early childhood curriculum offers creative expression, social and emotional interaction, child-adult communication, child-child communication, physical expression, knowledge acquisition, reasoning practice, risk-taking, and personal autonomy. Early childhood learning happens through play. In this case, play is a serious matter, although it is quite fun to all involved. Children learn by doing and actively participating. When given the opportunity to explore, children flourish. They experiment, make choices, achieve strength and a sense of belonging as an effective individual within the context of a supportive, safe group. It is my belief that early childhood learning must happen in an integrated manner. Children of this age are too young for rigidly separated subject matter, and the skillful teacher of young children easily integrates the physical, emotional, social, creative, and cognitive areas of early learning. Role of Child as a Learner Johann Pestalozzi and Froebel, two of the earliest professionals in early childhood education, championed the development of the quality of early childhood theory and practice. Pestalozzi contended that young children learn most effectively by doing, by playing, and by interacting with the environmentthe physical world and other children (McCarthy Houston, 1980, p. 4). Early, effective learning happens best in a mixed age group, multi-cultural settings,  Froebel, like Pestalozzi, believed that play is of paramount importance in the development of the child, and that the emotional quality of the childs life (relationship with parents and other significant people) profoundly permeates the quality of the childs life (McCarthy Houston, 1980, p. 6). Pestalozzi did not particularly formalize his theories and methods, but he had a very good intuitive grasp of the necessity for language development, nurturing environments, and healthy relationships for children as a springboard for optimum learning. The child as a learner has cognitive needs, and these vary according to the age of the child. Piaget became famous for his work in the cognitive domain, and his guidelines of pre-operational thought to more sophisticated abstract thinking are useful for teachers who wish to be careful about not expecting too much from children who are operating at a lower cognitive level (DeVries Kohlberg, 1987, p. 54). His work was rather theoretical, and others (principally Kamii and DeVries) have expanded Piagets theory to widen its practical usefulness in early childhood classrooms. The young child learns from the motivation of a need to know, and most early learning takes place in the context of the home and relationship with parents and other family members. Lev Semenovich Vygotsky, one of the earliest workers in the area of developmental psychology and psychopathology, believed that childrens learning happens within the framework of the childs activities and is greatly influenced by the society and values of the persons near the child. The entire field of child development then consists of an endless stream of dialectical conflicts and resolutions, with the resolutions then internalized to form the childs increasingly sophisticated physical and psychological knowledge (Thomas, 1992, p. 322). John Deweys progressive education movement greatly affected thinking and practice for teachers desiring to arrange an appropriate environment for young learners. Dewey was one of the most influential educational philosophers in the United States in the early 1900s and his influence is still felt in the 1990s (McCarthy Houston, 1980, p.6). Dewey and other forward-thinking professionals of his time believed that learning should be based upon the childrens interests and that children should be actively involved in their education. Before Deweys time, most classroom activity consisted of teachers instructing passive, obedient listeners. Deweys work provided a solid philosophical basis for early childhood educators who desire to integrate subject matter into whatever the children are actively involved with at the moment. Dewey contended that any kind of life experience is valuable for learning. Dewey was humanistic in his orientation, and his work spoke to the importance of human interest, value, and dignity (McCarthy Houston, 1980, p. 8). Abraham Maslow was one of the first psychologists to emphasize the importance of various needs being met before other, higher needs come into focus. He placed the physical needs at the bottom of his needs hierarchy, followed by the need for love and belonging. Physically, children at young ages grow and change dramatically from year to year, and the alert, educated teacher will firmly grasp the necessity of a balanced program of large muscle activity, small muscle play, outdoor opportunities for expression of vigorous excess energy, and small motor expressive activity (Bredekamp, 1987, p. 56). Psychologically, children must feel safe before they are able to explore and learn. Children learn through social interaction with adults and other children, and their learning begins with awareness, moving through cycles of exploration, questioning, and application. Vygotsky viewed each childs learning in terms of that childs own ontogenetic development. Each experience of the child comes about as a result of the childs prior experiences of problem-solving and problem resolution (Thomas, 1992, p. 323). Mitchell, a student of John Dewey, also emphasized the necessity of learning within the context of the group. She believed that education for a democratic society begins at a very young age and she placed great importance on young children learning to cooperate and operate within a group (McCarthy Houston, 1980, p. 9). Carl Jung did a great deal of research and writing in the areas of variation of personality types, and his concepts lead us to believe that some individuals do their best work completely alone, even at a very young age. Carl Rogers also wrote about the importance of the individual contemplative experience. Like Maslow, Rogers as a humanistic psychologist believed in the importance of the human, individual aspect of learning. He saw learning as a change in self-organization. These learnings may be threatening and happen best in a psychologically safe, supportive environment (Rogers, 1969, p. 159). Although Rogers work primarily applied to the therapeutic counseling situation, it has great application to anyone dedicated to assisting others learn more about themselves. Role of the Teacher in the Learning Process Carl Rogers also had definite views on the nature of learning and the role of the teacher. He said that people learn by doing and by activities which involve the whole person (Rogers, 1969, p. 162). He contended that the most useful learning is the learning of the process of learning so that practical problems of living in a changing society may find successful solutions. According to Rogers and others who have followed similar philosophies, teachers are guides and facilitators. They set a creative, stimulating, supportive environment which enhances the childs natural curiosity about life around him. The astute early childhood educator provides a variety of activities, objects, events, materials and people which will assist the children in channelling their innate drive to learn. The best teachers are current in the understandings of fads and characters that appeal to young childrentelevision shows, favorite foods, clothing, and stories that are modern. Young children tune out adults who simply do not understand current culture. In this way, responsible teachers bring multicultural awareness into the classroom as well as information and materials relevant to their own ethnic background. Mixed classrooms provide an excellent opportunity to teach trust, respect, pride, appreciation of differences, and orderly group problem-solving (McCracken, 1993, p. 55). The teacher sets the tone for self acceptance and the acceptance of others. The effective early childhood teacher is an active learner, regardless of her own age, and this type of professional engages children in active participation with materials that are genuinely interesting to the children. This type of adult extends the childs learning with skillful questioning and acceptance of error through experimentation. The well-versed teacher understands the various levels of cognitive learning, Piagets theories, and Blooms Taxonomy so that children are guided and encouraged, but never forced into an intellectual level that is not appropriate. Responsible early childhood teachers respect the individual styles of the students at all times, as well as the various cultures from which they originate. The emotional tone in the best early childhood environments is one of warmth, high self-esteem, and safety. Creative expression is welcomed, even if the forms prove to be highly unusual. Mitchell advocated creative expression of the whole child, through conversation, art, music, dance, and story-telling (McCarthy Houston, 1980, p. 9). Cooperative learning and family involvement provide rich resources for respect among individuals and groups of a variety of different cultures. Skillful teachers in multicultural settings will recognize those values which must be basic (respect for the human body and rules for group interaction) and encourage the expression of the varieties and nuances specific to the individual ethnic group (McCracken, 1993, p. 65). Role of Peers in Learning The National Association for the Education of Young Children strongly advocates the guidance of social-emotional development in the classroom. Teachers have the responsibility for positive modeling, encouraging expected behavior, redirecting inappropriate actions, and setting clear limits. With this type of skilled teaching, children learn the social skills of cooperation, helping, negotiation, and verbal communication. In order for these important social skills to happen, teachers must depart from the traditional modes of instructing, placing children at individual desks, and spending a great deal of time as referee or punisher (Bredekamp, 1987, p. 55). CLASSROOM PRACTICES It is evident from the previous writing that effective teaching requires the logical, ethical translation of teaching philosophy into classroom implementation. Most importantly, all activities for young children must be developmentally appropriate to the age (Bredekamp Rosegrant, 1992). This is true across the board in every subject matter and in every aspect of the childs beingphysical, emotional, social, cognitive, and spiritual. SUMMARY/CONCLUSION In order to be an effective early childhood teacher, I must know my own philosophy, limitations, prejudices, and strengths. In general, I prefer five-year olds, and honestly, I am more comfortable with students of this age who are from my own cultural background. I lean philosophically towards the concepts of Pestalozzi and Froebel as well as the humanistic psychologists who followed in this country. Most of all I strive to provide age-appropriate materials and experiences for the children. References Bredekamp, S. (1987). Developmentally appropriate practice in early childhood programs serving children from birth through age 8. Washington, D. C. : NAEYC. Bredekamp, S. , Rosegrant, T. (Editors) (1992). Reaching potentials: Appropriate curriculum and assessment for young children, Volume 1. Washington, D. C. : NAEYC. DeVries, R. , Kohlberg, L. (1987). Constructivism early education: Overview and comparison with other programs: Washington, D. C. : NAEYC. McCarthy, M. , Houston, J. (1980). Fundamentals of early childhood education. Cambridge, Massachusetts: Winthrop Publishers. McCracken, J. B. (1993). Valuing diversity: The primary years. Washington, D. C. NAEYC. Rogers, C. (1969). Freedom to learn. Columbus, Ohio: Merrill. Thomas, R. M. (1992). Comparing theories of child development, Third Edition. Belmont, California: Wadsworth Publishing Company.

Performance comparison of two fast food businesses

Performance comparison of two fast food businesses The purpose of this article is to measure the performance of two companies in the same area of business, which is fast food industry. This study benchmarks two established global fast food sellers who have expanded operations further afield over their illustrious histories, displaying innovation, vision and success in the operation. The companies will be assessed using a range of financial methods such as horizontal, trend, vertical and ratio analyses. This will be done based on the companys financial statements for the last three years. Non-financial performance measures, which are based on evidence of business performance, will also be used. A SWOT analysis will then be done for each company in order to give the reader a concise picture about where both companies are now, and what they can do to improve their position in the market. Each company will then be assessed to see how attractive it is to both investors and employees. The companies chosen for this report are McDonalds and Burger King. They are two of the biggest fast food sellers that dominate the not only the UK but also the world fast food sector. When deciding how to position a product, marketing managers need to understand how product differentiation affects competition. Thus, this paper examines the relationship between product differentiation and prices and profits in the fast food industry. These companies were chosen as they are of interest to the author. The two fast food sellers are similar in nature as although they both have a substantial share of the UK market, either they are all famous the world. Therefore their financial data is relatively comparable. Historical BackgroundNames, addresses and logos of companies: Address McDonalds Plaza Oak Brook IL 60523 USA Address 5505 Blue Lagoon Drive Miami Florida 33126 USA Company History McDonalds Corporation McDonalds Corporation is the worlds largest hamburger fast food restaurants, serving more than 58 million customers every day. McDonalds concentrate on sells hamburgers, chicken products, French fries, breakfast, soft drinks, shakes and deserts. It represents the trends of Western nations. While at the same time, it faces the criticism over the healthiness of its products. McDonalds has modified its menu to include alternatives considered healthier such as salads, wraps and fruit. The business began in 1940, with a restaurant opened by brothers Richard and Maurice McDonald in San Bernardino, California. The site of the McDonald brothers original restaurant is now a museum. With the expansion of McDonalds into many international markets, the company has become a symbol of globalization and the spread of the American way of life. The company operates through five subsidiaries (structured on a geographic basis): McDonalds USA, McDonalds Europe, McDonalds AMEA (Asia, Middle East and Africa), McDonalds Latin America and McDonalds International. An additional subsidiary was created in McDonalds Ventures, which consists of the companys non-McDonalds brand. Burger King Corporation Burger King often abbreviated as BK, is a global chain of hamburger fast food restaurants like McDonalds headquartered in unincorporated Miami-Dade County, Florida, United States. Burger King Corporation banner operates the international business. The company began as a Jacksonville, Florida-based restaurant chain in 1953. After the company ran into financial difficulties in 1955, its two Miami-based franchisees, David Edgerton and James McLamore, purchased the company and rechristened it Burger King. Over the next half century the company would trade hands four times, with its third set of owners, a partnership of TPG Capital, Bain Capital, and Goldman Sachs Capital Partners, taking the company public in 2002. The current ownership group, 3G Capital of Brazil, acquired a majority stake in the company in a deal valued at $3.26 billion in late 2010. The companys business is divided into three geographic segments; the US and Canada; Europe, the Middle East, Africa and Asia Pacific (EMEA/APAC); and Latin America. About 7,512 Burger King Stores are located in the US and Canada. Over 2,379 of the companys restaurants are located in Europe, Middle East and Africa (EMEA), 672 restaurants in Asia Pacific (APAC) and 1,002 restaurants in Latin America. Business activities and Product treeMcDonalds Corporation McDonalds operates, franchises, and services a worldwide chain of about 31,000 fast food restaurants in the world. Franchisee, Affiliate and Corporation are three ways, which McDonalds operate the worldwide stores. About 25% of the companys revenues come from franchisee outlets. The company and its franchisees use special method to guarantee uniformity in both services and standards. McDonalds restaurants offer a substantially uniform menu. It also tests a range of new products on an ongoing basis and sells a variety of other products during limited-time promotions. Source: McDonalds website Burger King Corporation Burger King (BKC) is the worlds second largest chain of fast food hamburger restaurants. Burger King operates more than 11,565 restaurants in 71 countries and the US territories, of which 1,360 restaurants are company restaurants and 10,205 are owned by independent franchisees. Among of these, 7,207 restaurants are located in the US and 4,358 are located in international markets. Burger King offers a range of reasonably priced food items, which content burgers, sandwiches, salads and breakfast items. The Whopper sandwich is its largest-selling product. Burger King was the first fast-food chain to introduce drive-through service, which now accounts for a majority of the companys business. But the development of drive-through stores is less than McDonalds. The company generates revenues from three sources: sales at company restaurants, royalties and franchise fees and property income from certain franchise restaurants that lease or sub lease property from the company. Source: Burger King Website Financial AnalysisThe following financial analysis of both companies uses the data provided in the Annual reports of each company from Fame or official website. Horizontal, trend, vertical and ratio analyses will be used as rationale to benchmark performance between the firms. Horizontal Analysis Conducting a horizontal analysis allows us to compare different items in each companys financial statements. This can be done over a period of time so that any changes that have taken place can be noted. Therefore it is a useful tool for comparing the performance of two companies. The data below shows the consolidated income statement of both firms between the years of 2007-2009. However, McDonalds financial report is calculated about in Europe, while Burger King is calculated in UK. Each companys performance will be analyzed and compared and any notable differences will be discussed below. McDonalds: there was an increase from 2008 to 2009 (3.2%) due to the world financial crisis. But there was also a significant decline from 2009 to 2010(11.9%), one reason is that the company is too large to operate. Burger King: with 6.0% growth from 2008 to 2009, Burger Kings performance is better than its competitors. Following with financial crisis end, there was 8.4% growth between 2009 and 2010. Gross Profits: This is worked out by taking the cost of sales figure away from turnover. Both companies even with high increases in operating cost for 2008, they ended up with a small increase in net income. This can be contributed to the exceptional gross profit earnings for the year. McDonalds gross profit for 2008 increased 3.2%, while Burger King only increased 1.3%. This can be attributed to the McDonalds grabbed the opportunity of financial crisis. However, McDonalds and Burger King also suffered a decline in 2009. The main reason is that companies with global operations translate sales and franchise revenue from foreign currencies into dollars. That can boost revenue and profit when the dollar is weaker but hurt results when the U.S. currency is stronger because foreign sales then translate into fewer dollars. Operating income The pattern visible for the operating income over the three-year period is different to the other indicators and causal factors are difficult to establish. It shows a huge increase in 2008, this could be attributed to the considerable increase in gross profit compounded by the operating expenses being trimmed providing a much-improved operating income for the year. In 2008 however, operating income falls, likely due to a combination of a gross profit decrease and an operating expense increase. Net Profit: this is the actual earnings of the company after all expenses and taxes have been paid and are usually referred to as the bottom line. Both companies are experiencing a small rate of organic growth in the year of 2008. This is despite the economies financial difficulty during 2008; people prefer to choose fast food as their daily food. It is likely that during 2008-09, the rise in turnover is partly down to the high price of fuel, caused by high oil. In Europe, two companies performance reflected Europes strategic priorities to upgrade the customer and employee experience, enhance local relevance, and build brand transparency. In addition, McDonalds enhanced customer trust in our brand through communications that emphasized the quality and origin of McDonalds food and our sustainable business practices, while Burger King did much better. Trend Analysis By conducting a trend analysis we can see the ways in which the companies have changed over the last three years. The year 2007 is taken as the base year and set at 100%. Each following year is then expressed as a percentage of the base year using this equation: Gross Profits: Whilst both companies experience similar growth in their turnover, McDonalds experience a decrease in gross profits in 2009-10. Burger King does not have this problem and so they experience almost same level in gross profits over the three-year period. Percentage Change in Gross Profit Operating Profit: Both companies experienced increases in their operating profit. This McDonalds plan is leading to the company becoming more efficient, which is reflected by this increase. Through this, the company has significantly reduced its administration expenses over the three-year period. They have also experienced a rise in other operating income pre operating profit, which has led to the rise in operating profit, despite the fall in gross profit. Percentage Change in Operating Profit Net Profit: Burger King net profit remains consistent for the first two years and then drops during the year 2009-10. This pattern is to be expected due to companies with global operations translate sales and franchise revenue from foreign currencies into dollars, which led to people trying to spend less money. McDonalds Net Profit rocketed in 2008-09, due to the fact that people would like to choose fast food during financial crisis. Percentage Change in Net Profit Vertical Analysis A vertical analysis shows us the relationship between each income statement item to the turnover. In other words, it shows all other figures as a percentage of the turnover or net sales, which is set at 100%. The following equation can be used in order to work this out: Balance Sheet A vertical analysis can also be conducted on the companys balance sheet, representing all items as a percentage of the total assets. In simple terms, this allows us to see where a business spend and receives its money. Fixed Assets: Fixed assets are those with a remaining useful life of over one year. Tangible fixed assets refer to physical assets such as buildings; land etc. and intangible assets refer to items such as goodwill and trademarks. McDonalds is much bigger than Burger King, which means it has more stores in Europe and UK. Current Assets: Current assets are those that are held for less than a year and can be realized quickly. They act as a source of funds for day-to-day activities (Investor Words, 2009). During the world financial crisis, two companies were under its influence in 2008. While in 2009, two companies had made a quick change. So their current assets suffer from a huge increasing. Total Liabilities: This figure is made up of both current liabilities and long-term liabilities. Current liabilities are the debts to creditors and suppliers, which the companies are expected to pay within a year, often in cash. Long-term liabilities are debts that do not need to be repaid within a year. Burger King has a lower share of long-term liabilities than McDonalds does. This suggests that Burger King is in a better financial position when it comes to repaying debt, as the majority of their capital comes from Shareholders funds instead of loans. Ratio Analysis Conducting a ratio analysis allows us to compare the specific items in each companys financial statements over the three years period. There are four classifications of ratio analysis: Profitability, Liquidity, Efficiency and Investment. Conducting a ratio analysis from each of the four classifications should give a good overall picture of each companys performance. Profitability: Gross Profit Margin Gross Profit Margin = Gross Profit x 100 Turnover Gross profit margin allows us to see the proportion of sales that is left over once the costs of sales have been accounted for. This gives us an idea about how much money the company is making on their sales alone, before accounting for other income, administration expenses, interest and tax. This is a particularly relevant measure for this industry as the vertical analysis showed that the cost of sales takes up a huge percentage of the total turnover. Generally, the higher the gross profit margin is the better a company is performing. Liquidity: Current Ratio Curent Ratio = Curent Asset Curent Liabilities The current ratio is used to test the liquidity of company. A high current ratio of over 2 to 1 suggests that a company would easily be able to pay off its debts using its current assets, putting them in a good financial position. Efficiency: Asset Turnover Asset Turnover = Sales (Turnover) Total Assets This ratio measures how efficient a company is at utilizing their assets in order to generate sales. A high ratio indicates that a company is making good use of its assets. McDonalds is using its assets more efficiently than Burger King. Both companies experience improvement in their asset efficiency throughout the two year period which could again be attributed to the improvement programs that they are both currently running. While in 2009, two companies suffered from a small declining. However, McDonalds is much better than Burger King. Investment: Price/Earnings Ratio P/E Ratio = Market Earnings per Share Price per Share This final measure is a clear indication to potential investors, of the earnings they will be receiving. The ratio essentially indicates the price they are paying for a unit of income. If one company has a higher ratio than the other then the relative earnings received is for the price of the share is less than the other company. When comparing two companies they can use as relative prices to determine which one delivers the greatest benefit for their price. In addition, the lower the value, the quicker the investment will be recovered through earnings. Both companies started in a similar position in 2009-10. This ratio does not necessarily mean the investor will receive less because the fluctuations in share prices paid by each investor may differ greatly, especially in this three year period where the decline was drastic in 2008. However, upon analysis by a potential investor, it may indicate that at the end of 2008s financial year, Burger King looks to provide slightly better earnings per share relative to the price paid. However this is not rigid, prices fluctuate by the hour and do not always resemble financial performance. Non-Financial Analysis It is also important to factor in a variety of non-financial measures of performance in order to help us to assess the position of these companies. This may help to explain why one company is experiencing success over another. The fast food industry in the world is extremely competitive and so a number of different performance measures ¼Ã…’ which are thought to be relative to the industry have been used. Global operations McDonalds concentrate on globalization, sometimes referred to as the McDonaldization of society. The Economist newspaper uses the Big Mac index to describe the McDonalds globalization. McDonalds was the first restaurant to consistently offer clean restrooms, driving customers to demand the same of other restaurants and institutions. McDonalds wants to open a large number of drive-through stores in the world. McDonalds make a deal with the French fine arts museum, the Louvre, to open a McDonalds restaurant and McCafà © on its premises, in November 2009. Burger King was successful in the US and then it brought Chicken burger to Europe. Consumers are urged to cheat on beef, with the message that Burger King announces can offer more than just beef burgers. The creative marketing is likely to engage consumers, while chicken may appeal to more health to customers. To assist in its global expansion, Burger King has established several subsidiaries to develop partnerships and alliances to expand into new areas. In Europe, Burger Kings subsidiary Burger King Europe GmbH is responsible for the licensing and development of BK franchises in the that market. At the end of 2010 year, Burger King is the second largest hamburger fast food company, which the first one is McDonalds (32,400 locations) and the fourth largest fast food restaurant chain overall after Yum!(37,000 locations), McDonalds and Subway (32,000 locations). Success of Branding and Advertising im lovin it is an McDonalds Corporations slogan. It was created by Heye Partner. The English part of the campaign was launched in the UK in 2003. With the music of Tom Batoy and Franco Tortora (Mona Davis Music) and vocals by Justin Timberlake is famous all over the world. In Spring 2008, McDonalds published their new image and slogan: What were made of. This was to promote how McDonalds products are made. Packaging was tweaked a little to feature this new slogan. In Fall 2008, McDonalds started new packaging, eliminating the previous design stated above with inspirational messages, the im lovin it slogan. McDonalds also updated their menu boards with darker, yet warmer colors, more realistic photos of the products featured on plates and the drinks in glasses. In 2009, McDonalds expects to have all of this nationwide. As to Burger King, Golden Age of Burger King advertising was during the 1970s when it introduced its Magical Burger King. And then several well-known and parodied slogans appear. In 2003, Burger King published new advertising with the hiring of the Miami-based advertising agency of Crispin Porter + Bogusky (CP+B). They have reorganized Burger Kings advertising with a series of new factors. It centered on a redesigned Magical Burger King character accompanied with a new online presence. A Burger King advertising running in recent weeks declares the Kings gone crazy. It shows the burger chains royal mascot running through a building and crashing through a plate glass window before being tackled to the ground by men in white coats. The advertising is supposed to trumpet Burger Kings new Burger King Steakhouse XT burger: The kings insane for offerings so much beef for $3.99, said the advertising. Success of Menus McDonalds decision to display nutritional information, including calorie and fat content and also on its product packaging well help restore faith in the brand by empowering customers menu choices. However, the move does not represent a fundamental change to the companys overriding mission. It just provides cheap, flavorsome food, served quickly. McDonalds clearly wants this increased disclosure will restore trust in its products. Indeed, data monitor research shows that transparency is clearly needed: 40% of UK consumers are skeptical about health claims made by food manufacturers, compared to 32% who are trusting. McDonalds healthier menu items that have this year helped promote sales in Europe. Consumers will soon be able to read that the Cheese, Ham and Pepperoni Deli Brown Roll contains 616 calories, compared to 493 in a Big Mac, along with almost 10% more fat and more than double the amount of salt. Nonetheless, as the worlds leading fast food company, McDonalds will always per form better. In contrast to other industry players, Burger King has not focused on making its food healthier in the past, believing that the Superfan values taste over health when making food choices. In 2005, for example, the company invested a lot on fast foods to make them less unhealthy, with less salt, sugar and fat, stating it wanted to focus on providing tasty foods. By focusing on taste, Burger King aimed to gain a competitive advantage and achieve a reputation for producing tastier burgers. While this focus on taste is appealing to the Superfan, health is an issue of growing importance to a large sector of society. Therefore, in order to remain competitive, the company has had to respond to this growing demand for healthier foods. Its rivals have already made health changes to their menus and, with this in mind, Burger King has reformulated some of its menu items. Consumers are urged to cheat on beef, Burger King announces that it can offer more than just beef burgers. The creative marke ting is to tall consumers, while chicken is more health. Burger King has announced that it will be provided new hamburger named the Tender crisp Premium Chicken burger in the UK, Ireland, Sweden and Denmark. At the same time, Burger King wants to create new imagine that consumers go to fast food stores looking for health beneficial products, which will makes them feel better about their choice in turn. Market share Burger King has around 7,800 restaurants locally, while McDonalds has whopping 13,000 locations locally. Burger King has approximate 21.9% of the market share, while McDonalds has more than double that, a whopping 44% market share of the fast food industry. Comparatively, McDonalds has been expanding rapidly into the international market; in fact McDonalds has expanded in many third world countries, which include India, China, etc. Although Burger King also has international reach, its nowhere near McDonalds reach. Burger King has managed to expand in only a handful of international markets. Company PotentialMcDonalds SWOT Analysis McDonalds SWOT Analysis Strengths Market-leading position Robust all-round growth Strong brand equity Opportunities Alliance with Warner Home Video Innovations in the Menu Rising Hispanic population in US Strengths McDonalds is the worlds largest foodservice retailing chain. McDonalds serves one of the worlds favorite and most well known menus. The company has shown a strong growth in revenues. Its consolidated revenues have increased at a compounded annual growth rate. All segments of the company have witnessed strong growth. Europe, McDonaldss largest geographical market, saw revenues increase by 14.7%. McDonalds has a well-established brand that appeals to varied age groups and customer profiles. The Business Week magazine has ranked McDonalds as one of the ten most recognized brands in the world, a position that creates significant opportunities for the company. The company makes some of the largest selling fast foods in the world. Weaknesses The company witnessed an operating loss from its non-McDonalds brand restaurant operations. Operating losses from both these segments have lowered McDonalds overall profitability. McDonalds revenue per employee compared quite poorly with the average figures in the foodservice and restaurants industry. This indicates that the companys per employee productivity and profitability is lower than that of its competitors, a disadvantage in a fiercely competitive marketplace. During 2007-2009, McDonalds selling, general and administrative (SGA) expenses for Europe region increased substantially. Increasing SGA expenses in these segments have adversely affected the overall profitability of McDonalds. Opportunities A popular live-action series featuring Ronald McDonald will help further McDonalds popularity, especially amongst children. The company can cash in on this and boost its revenues. McDonalds continues to evolve its menu in order to maintain its leading market position. New products and branded everyday value remain a focus for McDonalds, as the company continues to refresh its offerings with its Euro Saver Menu in several European markets. Threats The company is facing pressures due to an increase in raw material prices. Owing to various import restrictions and higher demand, prices of beef. Further, the prices are expected to remain high during 2010 also. Beef is the major raw material for the companys products. A further hike in beef prices can have a negative impact on companys profitability. Over the past few years there has been a newfound emphasis on healthier eating. With a change in lifestyle, people are becoming more aware of the negative effects of unhealthy eating habits. This has a direct effect on the sales of the fast food chains that are associated with unhealthy food. Consumers are showing increased preference for fat-free and healthy food products. Food items containing trans-fat are losing market share as they are linked to cardiovascular diseases. Some negative publicity could adversely impact the revenues of the company, especially as consumers and government bodies all over the world get more conscious abo ut health effects of fast food. Burger King SWOT Analysis Burger King SWOT Analysis Strengths Strong market position and brand equity signifying customer acceptance Greater franchise mix-an attractive business model Innovative marketing campaigns and advertising to provide greater visibility Opportunities Expansion in existing and new markets-the rate of expansion in 2009 was 28% higher than the prior year Initiatives such as remodeling and usage if Bluetooth to enhance operational efficiency Positive outlook for quick service restaurant segment Strengths Burger King enjoys a strong market position with 11,925 restaurants operating in 73 countries and US territories. It is the worlds second-largest FFHR chain as measured by the total number of restaurants and system-wide sales. Additionally, BKCs Burger King and Whopper brands are two of the most widely recognized consumer brands in the world. Overall, the companys established brand image has enabled it to penetrate various global markets. The company leverages its strong market position to gain economies of scale and increase its bargaining power. BKC utilizes innovative marketing, advertising and sponsorships to drive sales and generate restaurant traffic. Strong and innovative marketing efforts will provide better visibility to the company, which will in turn have an impact on the revenue generating capacity of the company. Weaknesses Declining comparable sales growth-2009 recorded the lowest rate in three years BKC recorded a decline in its comparable sales growth in the recent past. Despite positive comparable sales growth across all reportable segments during 2009, comparable sales for the period were negatively impacted by significant traffic declines during the third and fourth quarters across many of the markets in which BKC operates. This was primarily driven by the continued adverse macroeconomic conditions, including higher unemployment, more customers eating at home, heavy discounting by other restaurant chains and the H1N1 flu pandemic. Declining comparable sales growth indicates the necessity of the management to focus on various product offerings that caters to the value conscious customers during times of poor economic conditions. Concentrated operations in terms of geographic presence and dependence on selected distributors-increases business risks. Opportunities Expansion in existing and new markets-the rate of expansion in 2009 was 28% higher than the prior year. Burger King is focusing on expanding its presence in existing and new markets. Expanding presence in existing and new markets will allow the company to establish a global footprint and favorably impact its revenue generating capacity. Initiatives such as remodeling and usage of Bluetooth enhance operational efficiency. Threats The fast food industry is intensely competitive and Burger King competes with many well-established food service companies on the basis of product choice, quality, affordability, service and location. As the restaurant industry has few barriers to entry, the company competes with large competitor base including restaurant chains and individual restaurants that range from independent local operators to well-capitalized national and international restaurant companies. McDonalds and Wendys are BKCs principal competitors. The company also competes against regional hamburger restaurant chains. The company also competes against national food service businesses offering alternative menus, such as Subway, PaPa Jones and Pizza Hut. Some of the Burger King competitors have greater financial, non-financial and other resources, which may help them to react to changes in pricing, marketing and other segment in general better than Burger King. Investor Potential This section will examine the attractiveness of investment into McDonalds and Burger King. The following two graphs show the variations in each companys share price over the three financial periods looked at throughout this reports. Both companies graphs are taken from Yahoo! Finance as this website showed the fluctuations during the three years that the financial analysis was conducted, allowing the share price to be compared to the businesses financial success. Share prices vary depending on how a company is performing; with more investors buying shares when they think the company is about to experience success. Success leads share prices to rise, due to the laws of supply and demand. McDonalds share price This graph shows that McDonalds experienced an overall increase in share price during 2006 to 2010. This could be due to the success of the McDonalds strategies, suggesting that the company has adopted a successful growth strategy and encouraging people to invest. Burger King share price Burger King have seen a steady drop in their share price relative to their drop in net profit in 2007-08, which could lead investors to become less attracted to the company. However, Burger King does have quite a strong growth strategy

Air Pollution :: Papers

Air pollution occurs when wastes dirty the air. People produce most of the wastes that cause air pollution. Such wastes can be in the form of gases or particles of solid or liquid substance. These substances result chiefly from burning fuel to power motor vehicles. Industrial processes and the burning of garbage also contribute to air pollution. natural pollutants include dust, soil particles and naturally occurring gases. The rapid growth of population and industry and the increased use of automobiles and airplanes, have made air pollution a serious problem. the air we breathe has become so filled with pollutants that it can cause health problems. Polluted air also harms plants, animals, building materials and fabrics. In addition, it causes damage by altering the earth's atmosphere. Chief sources of air pollution  · Forms of transportation,such as automobiles, airplanes, ships and trains are the leading source of air pollution of the industrial nations. The major pollutants produced by these sources are carbon monoxide, carbon dioxide, hydrocarbons(compounds of carbon and hydrogen), and nitrogen oxides(compounds of nitrogen and oxygen). Nitrogen oxides can react in the presence of sunlight to produce a form of oxygen called ozone(O3). Ozone is the chief component of photo-chemical smog, which is a common form of air pollution.  · Fuel combustion used for heating or cooling in factories contributes significantly to air pollution. Electric power plants that burn coal or oil also release pollutants into the atmosphere. The major pollutants from these sources are nitrogen oxides, sulphur oxides(compounds of sulphur and oxygen), and carbon dioxide.  · Industrial processes produce a wide range of pollutants. Oil refineries discharge ammonia, hydrocarbons,organic acids and sulfur oxides. Metal smelting plants give off large amounts of sulfur oxides and particles containing lead and other metals. Plants that produce plastic foam are a major source of chlorofluorocarbons(CFC's),compounds of chlorine,fluorine and carbon.  · Burning of solid wastes often creates a very visible form of air pollution-thick,black smoke. The burning of garbage, leaves and other

Hemispheres Of The Brain :: essays research papers

Hemispheres of the Brain   Ã‚  Ã‚  Ã‚  Ã‚  As I was reading the text I came upon a section that I thought to be quite fascinating. It talked about people who have a brain that functions like two different people inside of the brain. This is of course the Split-Brain Personality. As I studied this topic in more detail I found it to be quite broad and yet very detailed. I found that I needed a dictionary to be able to read all of the medical journals and books that are out there, to be able to understand what it was exactly, that I was reading. But with a little study and research I found that this is a precise science that is still largely full of mysteries. The study of hemispheric asymmetry with in the cerebral cortex had long been a fascination with the human race. The ancient Aztec cultures used to perform a type of brain surgery on humans. This is evident from the human remains that we find with incisions and piece's missing of the skull. Whether or not these primitive surgeries were successful is unknown. The earliest way for man to observe the brain was by noticing brain damage to a particular area of the brain that was damaged. Such observations were first recorded some 5,000 years ago (Myers,1995). The most popular case is that of Phineas Gage a railroad worker that had severe frontal lobe damage. This happened when a rail road spike was shot through his head by a piece of dynamite. Miraculously he lived through the experience, but with a severe change in his personality. From this physiologists learned that personality was largely controlled from this point namely by removing a persons inhibitions. For the most part the brain has been a mystery that is waiting to be opened. The last two decades have witnessed a period of research on the human cerebral functions comparable to the great era of discovery initiated by Broca in 1861(Young, G,. Segalowitz, S,. Corter, C,. Trehub, S,.1983). We have leaned more in the past 20 years about the brain and it's hemispheric asymmetry than we had learned in combined previous history.(Kosslyn, 1993). Most of this new work has been devoted to the study of cerebral functions in adults, but recently there has been a growing interest in infants and young children most especially among the study of hand preference. About 10 percent of the human population in left-handed(Myers,1995). By looking at ancient writings this right-hand preference has seemed to develop right from the start of the human race. It also is apparent that from ultrasound devises that about 9 in 10 fetuses suck

lord of the rings :: essays research papers

The Lord of the Flies William Golding’s book, The Lord of the Flies is a wonderful, fictional book about the struggle and survival of a group of boys trapped on an uninhabited island. This book kept me very interested and made me want to keep reading. The characters were very diverse and each had very appealing qualities in themselves. The setting is brilliantly described and the plot is surprisingly very well thought out. Many things like these make this book such a classic. Although there are not many characters in The Lord of the Flies, there are many different personalities and differences between them. The first character in the book is Ralph. Ralph is twelve years old with blond hair, and is the most charismatic of the group. He is described as being built "like a boxer," is somewhat charismatic and is chosen for chief, who makes it his job to lay down rules and try to organize a society. Throughout the novel he is always in conflict with Jack, who wants to be chief himself. Ralph and Piggy agree with each other’s ideas, but Ralph doesn’t realize how important Piggy really is to him until the very end of the novel. Although Ralph never reaches the understanding about the Beast that Simon does, he knows right from wrong. Jack is about Ralph's age, with a skinnier build and red hair. His freckled face is described as being "ugly without silliness." From the very beginning, he seems to harbor emotions of anger and savagery. At first, he is the leader of his choir group, who becomes hunters as the book progresses. Finally, his savage personality and ability to tell people what they want to hear allows him to overtake Ralph as chief. Jack does not believe that the Beast exists and is the leader of anarchy on the island. From the start of the novel he does not like abiding by rules of any kind. He simply wants to hunt and have a good time. Not seeming to care about being rescued, Jack and his tribe are examples of the Beast running rampant. In the beginning of the story Jack, still conditioned by the previous society he had been apart of, could not bear to kill a pig that was caught in the brush. As the plot progresses he becomes less and less attached to any societal norms.

Impact of Foreign Aid on Poverty and Economic Development in Nigeria

CHAPTER ONE INTRODUCTION This project focuses on the poverty profile in Nigeria, the foreign aids given to the nation to help alleviate poverty and how it affects the economic development of Nigeria. According to the World Bank website, â€Å"poverty is hunger. It is lack of shelter. Poverty is being sick and not being able to see a doctor. It is not being able to go to school, not knowing how to read, and not being able to speak properly. Poverty is not having a job, and is fear for the future, and living one day at a time. It is losing a child to illness brought about by unclean water. And lastly, it is powerlessness, lack of representation and freedom. † Poverty is the inability to achieve a certain minimum standard of living. It is multidimensional, involving not only a lack of income, but also ill- health, illiteracy, lack of access to basic social services, and little opportunity to participate in processes that influence people’s lives. Mollie Orshansky, who developed the poverty measurements used by U. S government states that poverty is â€Å"to be poor is to be deprived of goods and services, and other pleasures that people around us take for granted† (Schwartz, 2005) Poverty is pervasive; as about 1. billion people in the world still live on less than a dollar a day and nearly 850 million people go hungry every night. (World Bank) According to Jhighan (2003), poverty is a misery-go-round plaguing the less developed countries. 1. 1BACKGROUND TO THE STUDY The poverty level in Nigeria; as described by the World Bank (1996) is a paradox tha t contradicts the immense wealth it has. Nigeria is a country endowed with human, agricultural, petroleum, gas and large untapped mineral resources. It earned over US$300 billion from just petroleum during the last three decades of the twentieth century. Rather than recoding remarkable progress in national, socio-economic development, Nigeria has retrogressed to being one of the 25 poorest countries of the 21st century while she was among the richest 50 in the early 70s. Nigeria enjoyed steady economic growth and relative stability in the 1960s and 70s especially with emergence of the mining industries. The per-capita income grew steadily and few people were between the poverty line as the agricultural public and industrial sectors absorbed a highest percentage of the labor force. In the early 1980s, severe economic crisis shook Nigeria bringing along with them real and perceived increases in the level of poverty in the country. This was due to factors such as declining prices of oil, the country’s main export, rises in the real international interest rates that compounded the external debt and subsequent slowing down of economic activities and growth. The major underlying cause of all these was domestic policy mistakes. (Aigbokhan, 2000) In 1980, poverty was regarded as a rural phenomenon but by 1985, it had spread to urban areas. This was due to the high rural urban migration that accompanied the impetus to development generated by oil revenues. Also, the collapse of oil exports income and massive importation of food to meet the production capacity in the agricultural sector severely affected urban dwellers. Economic reforms were introduced by the government in 1986; Structural Adjustment Programme (SAP), which led to the removal of reduction of subsidies that were incidentally strategic to improving human welfare. Government spending on social services became dismal while the quality and quantity of public social services declined, especially in poor communities. Its social costs are reflected in increasing unemployment, cuts in social services, and general increases in the prices of basic commodities. The economic reform programme placed untold hardship on the vulnerable groups of the society such as the women, children and the aged, who make up a larger share of the poor. The standard of living of the general populace fell and led to poor access to food, shelter, education, health and other essentials of life. In 1992, urban poverty remained the same at 37. 5% while rural poverty reduced to 46%. By 1996, it was very obvious that urban poverty had become an increasing problem in Nigeria. For example, the number of people in poverty increased from 27% in 1980 to 46% in 1985. it declined slightly to 42% in 1992, and increased very sharply to 67% in 1996. In 1999, estimates showed that over 70% of Nigerians lived in poverty. The government then declared in November 1999 that the 470 billion naira budget for the year 2000 was â€Å"to relieve poverty. † By 1996, Nigeria had become the 13th poorest country in the world and occupied the 142nd rank on the human development index (HDI) scale. World Bank, 1996) With the reforms, the real growth became positive but there was still a question whether the reform alleviated poverty; how far poverty was reduced. Foreign aid is the economic help provided to communities of countries due to the occurrence of a humanitarian crisis or for the achievement of a socioeconomic objective. There are two types of aids: Humanitarian aid is the i mmediate assistance given to individuals, organizations or government for emergency relief caused by war or natural disasters. Development aid is help given by developed countries to support economic or social development in developing countries so as to create long term sustainable economic growth. The sources of foreign aids include bilateral and multilateral aids. Bilateral aid is given by the government of one country directly to another. Multilateral aid is aid from an international financial institution; such as the World Bank; the International Monetary Fund; the African, Asian and Inter-American Development Banks; the European Development Fund; and various United Nations agencies such as the United Nations Development Programme. These organizations are governed by individual contributing countries and capital markets. Non-governmental Organizations (NGOs) also play a major role in distributing aids. Tied aid is the aid which the donor requires a recipient to spend some or all of its foreign aid on goods and services produced in the donor’s country. This process is called tying of aids. This can also be done by offering aid as subsidized credit for the purchase of its exports. Majority of the NGOs in Nigeria receive foreign aids from USAID (The United States Agency for International Development) USAID is an independent federal agency that receives overall foreign policy guidelines from the United States Secretary of State. It seeks to extend a helping hand to countries struggling for a better life, recovering from a disaster or striving to live. It supports economic growth, agriculture, trade, health, democracy, conflict prevention and humanitarian assistance. Other organizations in Nigeria also receive funds from USAID to undertake projects ranging from HIV/AIDS prevention to bringing solar energy to a rural village. On the other hand, Nigeria is currently not eligible to receive grants through the Millennium Challenge Corporation (MCC), which was established under President Bush as part of the â€Å"new agreement for global development. † Its mission is to reduce global poverty through promotion of sustainable economic growth. Before a country is eligible to receive assistance, MCC looks at their performance on 16 independent and transparent policy indicators. Nigeria is a country, strategically important to the U. S. and a country whose citizens are greatly in need. At the same time, it is a country whose government does not pass the test for receiving aid through the MCC. 1. 2STATEMENT OF PROBLEM Poverty is a persistent problem which has existed for a long time in Nigeria. A lot of policies have been applied to alleviate it but without much success. This research x-rays the contribution of foreign aids as a solution to thi s problem. The specific problems we will look at in this study are the causes of poverty and also how foreign aids can contribute to poverty reduction in the Nigerian economy. . 3OBJECTIVES OF THE STUDY The major objective of this study is to examine the effects of poverty and foreign aids given to us on the development of the economy. The study will focus on other micro objectives, which include: i. To analyze the poverty profile and discuss the national trends of poverty in Nigeria. ii. To review the causes, measures and impact of poverty on the GDP of Nigeria. iii. To identify the forms and roles of the foreign aids given to Nigeria. iv. To identify the relationship between foreign aids and poverty in the Nigerian economy. 4. THEORETICAL FRAMEWORK This study uses the theoretical framework employed by Ogbuaku, Adebisi and Feridun (2006) based on the neoclassical growth model by Barro (1991). It is based on a small open economy version of the Solow (1956)-Swan (1956) growth model. The decision to study foreign aid in an open economy, as opposed to a closed, is three fold. First, most of the economies that receive foreign aid must reasonably be considered small and open. Second, to the extent that international credit markets are imperfect, some forms of foreign aid can have a positive impact on the poor. Third, in our empirical work we provide statistical evidence to suggest that greater international openness and access to credit stimulates economic growth. 5. METHODOLOGY The data for this study will be mainly from secondary sources such as World Bank reports, Central Bank of Nigeria publications such as the CBN Economic and Financial Review Bullions, occasional papers, CBN annual reports and statement of accounts, Federal Office of Statistics (Statistical bulletin) and other relevant journals. This research makes use of econometrics in estimating the relationship between poverty, foreign aids and its contribution to the development of the Nigerian economy. The multiple regression technique is used in obtaining numerical estimates of the variables in different equations. This is because the computational procedure is a component of other estimation techniques. The estimation period will be from 1981 to 2007. 6. MODEL SPECIFICATION This study uses the theoretical framework employed by Ogbuaku, Adebisi and Feridun (2006) based on the neoclassical growth model by Barro (1991). They specify a simple model of poverty and globalization as follows: POV  =     ? 0+1 ? TRADE+ ? 2FDI+  µÃ‚  (1) This model is augmented to include the foreign aid element thus: POV  =      ? 0+ ? 1TRADE+ ? 2FDI + ? 3AID+  µ   Ã‚  Ã‚   (2) Where POV is the yearly average per capita income trade is import + export /gdp fdi is foreign direct investment aid is foreign aid  µ is the stochastic error term 7. RESEARCH QUESTIONS This research aims to answer the following questions: †¢ Has foreign aids flow reduced poverty? †¢ Does foreign aid achieve its basic objectives in its recipient countries? Does foreign aid lead to a positive, negative or no effect on growth and economic development? 8. HYPOTHESIS To carry out this study, the following hypothesis will be tested based on a model to be specified and formulated to determine the relationship between foreign aids and economic development. Hypothesis 1 H0: Foreign aids have no significant impact on the econom ic development of Nigeria. H1: Foreign aids have a significant impact on the economic development of Nigeria. 1. 9SIGNIFICANCE OF THE STUDY This significance of this project can be viewed from the perspective of using foreign aids to alleviate poverty and also develop our economy. It studies the poverty profile of the nation and shows how the proper allocation of foreign aids will help improve the development of our economy. 1. 10SCOPE/ LIMITATION OF THE STUDY The research work attempts to cover the effect of the foreign aids given on the Nigerian economy and its impact on the poverty level in our nation. It focuses on the empirical analysis of the relationship between poverty, foreign aids and inflation in Nigeria. The objectives of this study cannot be achieved without encountering either minor or major problems. The major limitations of the study are those that characterize the use of secondary data. They include errors of improper data collections, errors of omission, the problem of over or under estimation of estimates, etc. 11. CHAPTERIZATION Chapter one contains the introductory part; the background to the study, the statement of the problem, the objective of the study and the methodology used. Chapter two contains the literature review and theoretical framework. Chapter three explains the methodology and also includes the model specification. Chapter four covers the analysis of data. Chapter five discusses the summary and conclusion. 1. 12DEFINITION OF TERMS The key terms in this chapter include: Poverty: is the shortage of common things such as food, clothing, shelter and safe drinking water, all of which determine the quality of our life. Foreign aid: is the help provided to communities in the event of humanitarian crisis, or to achieve a socio economic objective. Economic development: is the qualitative change in economic wants, goods, incentives, institutions, productivity and knowledge or the â€Å"upward movement of the entire social system. † Gross Domestic Product (GDP): is the total final output of goods and services produced by a country’s economy, within the country’s territory. Human Development Index (HDI): is a composite index that ranks all countries based on three fundamental dimensions: longevity, educational attainment and standard of living. CHAPTER TWO LITERATURE REVIEW 2. 1DEFINITION OF POVERTY Poverty comes in the form of deprivation. It is when there is lack of the means to satisfy basic needs. According to the Penguin Dictionary of Economics, poverty is â€Å"the situation faced by people whose material needs are least satisfied†. It also specifies that â€Å"poverty exists not merely because the needs of some low-income households are high. People are poverty – stricken when their living standard falls radically below the community average. This implies that, such people cannot have what the larger society regards as the minimum necessity for decency. Poverty is a living condition characterized by disease, illiteracy, malnutrition and squalor, to the extent that it inhibits the realization of potentials of individuals and even entire societies. It is therefore being regarded to as a socio-economic and political liability to any nation (Ekpo, 2000: 347). The poverty affects all aspects of a person’s life: susceptibility to disease, limited access to most types of services and information, lack of control over resources, subordination to higher social and economic classes, utter insecurity in the face of changing circumstances, including its psychological effect – the erosion of human dignity and self respect. The effects of poverty can not be over emphasized. It results into hunger, diseases, inadequate shelter and homelessness as part of the consequences of poverty. In our contemporary time, the poor man/woman has no voice in the society, lacks political influence, personal recognition; he is often emotionally and psychologically distressed and is always the downtrodden element in the society. (Fasoranti, 2008) 2. 2Concepts of Poverty Poverty is a multifaceted concept that manifests itself in different forms depending on the nature and content of human deprivation. It affects many aspects of human conditions, including; physical, moral and psychological. Poverty is so broad that the literature referring to the efforts of defining and estimating poverty is greater than the one concerning the strategies for overcoming poverty. The concept of poverty answers the question of what is a sufficient degree of needs satisfaction and how it is established. Different criteria have been used to conceptualize poverty. Most analysis view poverty as a result of insufficient income for securing basic goods and services. Others view it as a function of education, life expectancy, health, and child mortality, etc. According to Blackwood and Lynch (1994), poverty can be identified using the criteria of levels of consumption and expenditure. Sen (1983) relates poverty to entitlements, which are taken to be the various bundles of goods and services over which one has command, taking into cognizance the means by which such goods are acquired. Poverty can also arise as a result of inefficient use of common resources which is due to weak policy, environment, inadequate infrastructure, and weak access to technology, credit, etc. Poverty can also be described as structural or transient. Structural poverty (chronic poverty) is defined as persistent or permanent socio-economic deprivations. It is linked to factors such as lack of skills for gainful employment, limited productive resources, gender, endemic socio-political and cultural factors. Transient poverty, on the other hand, is defined as temporary or transitory and is linked to natural and man-made disasters. Transient poverty is more reversible but can become structural if it persists. Poverty was also conceptualized by Steeten and Burki (1978); broadly into four ways. They include: †¢ Lack of access to basic needs or goods; †¢ Lack of or impaired access to productive resources; †¢ Outcome of inefficient use of common resources; and †¢ A result of â€Å"exclusive mechanisms†. 3. CAUSES OF POVERTY Many different factors have been cited to explain why poverty occurs; but none of them has been able to gain universal acceptance. Possible factors include: Economic factors: 1. Recession: In general, the major fluctuations in poverty rates over time are driven by the business cycle. Poverty rates increase in recessions and decline in booms. Extreme recessions, such as the Great Depression have a particularly large impact on poverty. In 1933, 25% of all workers and 37% of all non-farm workers in the United States were unemployed. In New York, one child in every five was hungry. 2. Economic inequality: Even if average income is high, poverty rate will also be high if incomes are distributed unevenly. However the evidence on the relationship between absolute poverty rates and inequality is mixed and ensitive to the inequality index used. For example, while many Sub-Saharan African countries have both high inequality and high poverty rates, other countries, such as India have low inequality and high poverty rates. In general the extent of poverty is much more closely related to average income than it is to the variance in its distribution. At the same time some research indicates that countries which start with a more equitable distribution of income find it easier to eradicate poverty through economic growth. In addition to income inequality, an unequal distribution of land can also contribute to high levels of poverty. 3. Food prices and Poverty: Poor people spend a greater portion of their budgets on food than rich people. As a result poor households and those within the poverty threshold can be particularly vulnerable to increases in food prices. For example in late 2007 increases in the price of grains led to food riots in some countries. Decreases in food prices can also affect poverty although they tend to impact a different group – small farmers – than food price increases. 4. Democracy and Poverty: When we look at social dimensions of development, access to drinking water, girls' literacy, and health care are starkly divergent. For example, in terms of life expectancy, rich democracies typically enjoy life expectancies that are at least nine years longer than poor autocracies. Opportunities of finishing secondary school are 40 percent higher. Infant mortality rates are 25 percent lower. Agricultural yields are about 25 percent higher, on average, in poor democracies than in poor autocracies—an important fact, given that 70 percent of the population in poor countries is often rural-based. Poor democracies don't spend any more on their health and education sectors as a percentage of GDP than do poor autocracies, nor do they get higher levels of foreign assistance. They don't run up higher levels of budget deficits. They simply manage the resources that they have more effectively. † 5. Welfare states and Poverty: Currently modern, expansive welfare states that ensure economic opportunity, independence and security in a near universal manner are still the exclusive domain of the developed nations, ommonly constituting at least 20% of GDP, with the largest Scandinavian welfare states constituting over 40% of GDP. These modern welfare states, which largely arose in the late 19th and early 20th centuries, seeing their greatest expansion in the mid 20th century, and have proven themselves highly effective in reducing relative as well as absolute poverty in all analyzed high-income OECD countries. †¢ The governance effectiveness of governments has a major impact on the delivery of socioeconomic outcomes for poor populations †¢ Weak rule of law can discourage investment and thus perpetuate poverty. Poor management of resource revenues can mean that rather than lifting countries out of poverty, revenues from such activities as oil production or gold mining actually leads to a resource curse. †¢ Failure by governments to provide essential infrastructure worsens poverty. †¢ Poor access to affordable education traps individuals and countries in cycles of poverty. †¢ High levels of corruption undermine efforts to make a sustainable impact on poverty. In Nigeria, for example, more than $400 billion was stolen from the treasury by Nigeria's leaders between 1960 and 1999 (Ribadu,2007) 6. Environmental Degradation: In  many  parts  of  the  world, environmental degradation—the deterioration of the natural environment, including the atmosphere, bodies of water, soil, and forests—is an important cause of poverty. Environmental problems have led to shortages of food, clean water, materials for shelter, and other essential resources. As forests, land, air, and water are degraded, people who live directly off these natural resources suffer most from the effects. People in developed countries, on the other hand, have technologies and conveniences such as air and water filters, efined fuels, and industrially produced and stored foods to buffer themselves from the effects of environmental degradation. Global  environmental  degradation may result from a variety of factors, including overpopulation and the resulting overuse of land and other resources. Intensive farming, for instance, depletes soil fertility, thus decreasing crop yields. Environment al degradation also results from pollution. Polluting industries include mining, power generation, and chemical production. Other major sources of pollution include automobiles and agricultural fertilizers. In  developing  countries, deforestation has had particularly devastating environmental effects. Many rural people, particularly in tropical regions, depend on forests as a source of food and other resources, and deforestation damages or eliminates these supplies. Forests also absorb many pollutants and water from extended rains; without forests, pollution increases and massive flooding further decreases the usability of the deforested areas. 2. 4MEASUREMENT OF POVERTY/INDICATORS Poverty is usually measured as either absolute or relative poverty (the latter is actually an index of income inequality). . 4. 1Absolute poverty: This refers to a set standard which is consistent over time and between countries. An example of an absolute measurement would be the percentage of the population eating less food than is required to sustain the human body (approximately 2000-2500 calories per day for an adult male). The World Bank defines extreme poverty as living on less than US $1. 25 (PPP) per day, and moderate poverty as less than $2 a day. Estimating that in 2001, 1. 1 billion people had consumption levels below $1 a day and 2. 7 billion lived on less than $2 a day. Other absolute poverty indicators include: Life expectancy: According to Encarta encyclopedia, it is the average length of life that would be observed in a population in which the currently prevailing mortality risks at each age continued indefinitely. Infant mortality: Infant mortality rate is the probability of death in the first year of life, usually stated as a number per 1,000 births. 2. 4. 2Relative poverty: According to Wikipedia, relative poverty views poverty as socially defined and dependent on social context, hence relative poverty is a measure of income inequality. Usually, relative poverty is measured as the percentage of population with income less than some fixed proportion of median income. There are several other different income inequality metrics, for example the Gini coefficient or the Theil Index. Relative poverty measures are used as official poverty rates in several developed countries. As such these poverty statistics measure inequality rather than material deprivation or hardship. The measurements are usually based on a person's yearly income and frequently take no account of total wealth. The main poverty line used in the Organization of Economic Cooperation and Development (OECD) and the European Union is based on â€Å"economic distance†, a level of income set at 50% of the median household income. 2. 5Social Aspects of poverty Analysis of social aspects of poverty links conditions of scarcity to aspects of the distribution of resources and power in a society and recognizes that poverty may be a function of the diminished â€Å"capability† of people to live the kinds of lives they value. The social aspects of poverty may include lack of access to information, education, health care, or political power. Poverty may also be understood as an aspect of unequal social status and inequitable social relationships, experienced as social exclusion, dependency, and diminished capacity to participate, or to develop meaningful connections with other people in society. The World Bank's â€Å"Voices of the Poor,† based on research with over 20,000 poor people in 23 countries, identifies a range of factors which poor people identify as part of poverty. These include: †¢ Precarious livelihoods †¢ Excluded locations †¢ Physical limitations †¢ Gender relationships Problems in social relationships †¢ Lack of security †¢ Abuse by those in power †¢ Disempowering institutions †¢ Limited capabilities †¢ Weak community organizations 2. 6 FOREIGN AID The standard definition of foreign aid comes from the Development Assistance Committee (DAC) of the Organization of Economic Cooperation and Development (OECD), which defines foreign aids as financial flows, technical assistance, and commodities that are; designed to promote economic development and welfare as their main objective and are provided as either grants or subsidized loans. . 6. 1Humanitarian aid Humanitarian aid or emergency aid is rapid assistance given to people in immediate distress by individuals, organizations, or governments to relieve suffering, during and after man-made emergencies (like wars) and natural disasters. The term often carries an international connotation, but this is not always the case. It is often distinguished from development aid by being focused on relieving suffering caused by natural disaster or conflict, rather than removing the root causes of poverty or vulnerability. The provision of humanitarian aid consists of the provision of vital services (such as food aid to prevent starvation) by aid agencies, and the provision of funding or in-kind services (like logistics or transport), usually through aid agencies or the government of the affected country. Humanitarian aid is distinguished from humanitarian intervention, which involves armed forces protecting civilians from violent oppression or genocide by state-supported actors. The Geneva Conventions give a mandate to the International Committee of the Red Cross (ICRC) and other impartial humanitarian organizations to provide assistance and protection of civilians during times of war. The ICRC has been given a special role by the Geneva Conventions with respect to the visiting and monitoring of prisoners of war. The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) is mandated to coordinate the international humanitarian response to a natural disaster or complex emergency acting on the basis of the United Nations General Assembly Resolution 46/182. The Sphere Project handbook, Humanitarian Charter and Minimum Standards in Disaster Response, which was produced by a coalition of leading non-governmental humanitarian agencies, lists the following principles of humanitarian action: †¢ The right to life with dignity. †¢ The distinction between combatant and non-combatants. †¢ The principle of non-refoulement. 2. 6. 2Development aid Development aid is aid given by developed countries to support development in general which can be economic development or social development in developing countries. It is distinguished from humanitarian aid as being aimed at alleviating poverty in the long term, rather than alleviating suffering in the short term. The term â€Å"development aid† is often used to refer specifically to Official Development Assistance (ODA), which is aid given by governments on certain concessional terms. It is given by governments through individual countries' international aid agencies and through multilateral institutions such as the World Bank, and by individuals through development charities such as Action Aid, Caritas, Care International or Oxfam. In terms of dollars, the United States has consistently being the world’s largest donor (except in the mid-1990s when Japan briefly topped the list). In 2004, the U. S provided $19. 7 billion in ODA, with Japan, France, the United Kingdom, and Germany as the next largest donors, (including OA, the U. S provided a total of $21. 3 billion). However, when aid is measured as a share of donor income, the most generous donors are Norway, Denmark, Luxembourg, the Netherlands and Sweden, each of which provided between 0. 79- 0. 92% of GDP in 2004. Saudi Arabia provided aid equivalent to about 0. 9% of its income. The United States is one of the smallest donors by this measure at about 0. 17 percent of U. S income in 2004, just over half of the 1970 level of 0. 32% and less than one-third of the U. S average during the 1960s. Donors have pledged since the 1960s to devote 0. 7% of their income as aid, most recently at Financing for Development Conference in Monterrey, Mexico in March 20 02, but only a handful of small donors have achieved this level of aid. The offer to give development aid has to be understood in the context of the Cold War. The speech in which Harry Truman announced the foundation of NATO is also a fundamental document of development policy: â€Å"in addition, we will provide military advice and equipment to free nations which will cooperate with us in the maintenance of peace and security. Fourth, we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth of underdeveloped areas. More than half the people of the world are living in conditions approaching misery. Their food is inadequate. They are victims of disease. Their economic life is primitive and stagnant. Their poverty is a handicap and a threat both to them and to more prosperous areas. For the first time in history, humanity possesses the knowledge and skill to relieve the suffering of these people. † 2. 6. 3Specific types of Aid †¢ Project aid: Aid is given for a specific purpose e. g. building materials for a new school. †¢ Programme aid: Aid is given for a specific sector e. g. funding of the education sector of a country. †¢ Budget support: A form of programme aid that is directly channeled into the financial system of the recipient country. †¢ Sector wide Approaches (SWAPs): A combination of Project aid and Programme aid/Budget Support e. . support for the education sector in a country will include both funding of education projects (like school buildings) and provide funds to maintain them (like school books). †¢ Food aid: Food is given to countries in urgent need of food supplies, especially if they have just experienced a natural disaster. â₠¬ ¢ Untied Aid: The country receiving the aid can spend the money as they chose. It improves the government’s inter-temporal fiscal balance. †¢ Tied aid: The aid must be used to purchase products from the country that donated it or a specified group of countries. It always lead to deterioration, thus suggesting a potential tradeoff between consumer welfare and government solvency in the latter case. (Chatterjee and Turnovsky;2005) †¢ Technical assistance: Educated personnel, such as doctors are moved into developing countries to assist with a program of development. Can be both programme and project aid. OECD Categories The Organization for Economic Co-operation and Development's Development Assistance Committee puts foreign aid into three categories: †¢ Official Development Assistance (ODA): is the largest, consisting of aid provided by donor governments to low- and middle- income countries. Official Aid (OA): is aid provided by governments to richer countries with per capita incomes higher than approximately $9000 for three consecutive years; and to countries that were formerly part of the Soviet Union or its satellites. †¢ Other Official Flows (OFF): Aid which does not fall into the other two categories, either because it is not aimed at development, or it consists of more than 75% loan (rather than grant). 2. 7 POVERTY AND ECONOMIC GROWTH The impact on poverty on economic growth is problematic and is not clear. It is indicated that effective anti-poverty action is difficult to achieve largely because the poverty problem is multidimensional, complex and location specific deeply rooted into the social fabric and distribution of economic and political power (Tarp, 2000). One implication of these is that donors as well as analysts of the impact of aid on poverty need to be realistic about the severity of the difficulties that are likely to be encountered and the scale of effort needed to overcome poverty. Most evaluations have shown that achievements in this area are modest at best. In general, it was found that there is a wide gap between the stated commitments to poverty reduction and the actual practices of reducing poverty in the field. Most donors have paid little attention to conceptualization and analysis of poverty and have been particularly weak in translating the poverty reduction objective into operational guidance and in their country assistance strategies. Similar pitfall applies to most analysis of the impact of aid on poverty. The main instruments of donor intervention has been a series of ad hoc projects and in these improvements have been observed over time in respect of participation by beneficiaries and gender sensitivity but few donors have been concerned about sustainability. 2. 8FOREIGN AID AND ECONOMIC GROWTH Most foreign aid is designed to meet one or more of four broad economic and development objectives. †¢ To stimulate economic growth through building infrastructure, supporting productive sectors such as agriculture, or bringing new ideas and technologies; †¢ To strengthen education, health, environmental or political systems; To support subsistence consumption of food and other commodities, especially during relief operations and humanitarian crises; †¢ To help stabilize an economy following economic shocks. Despite these objectives for aid, economic growth has always been the main yardstick used to judge aid’s effectiveness, with more aid expected to lead to faster growt h. But at a broad level, there is no apparent simple relationship between aid and growth. The absence of a simple relationship means that for some observers, it is an evidence of a failure of aid to achieve its basic objectives. But for others, it is misleading, as other factors affect both aid and growth. Not surprisingly, the views on the economic impact of foreign aid on poor countries turn out to be highly divided. Some papers, e. g. Rwabutomize(2008) and Cato Institute (2004)) totally oppose the notion that foreign aid has beneficial effects on developing economies and even go as far as saying they indeed hinder growth. Others like Karras (2006), Durbarry, Gemmell & Greenaway (2004) and Wangwe (2004) find a positive relationship between the two. Yet a lot of research finds conditional relationships between the two variables. This section gives a summary of the views from the examined relevant and available literature on this subject. 2. 9Economic impact of foreign aid in theory The impact of foreign aid on recipient countries’ economies has been a subject of research and debate among scholars and policymakers for more than five decades. There are two obvious stands in the literature of foreign aid effectiveness: one argues that foreign aid spurs growth and development of the recipient countries while the other opposes this view by arguing that aid crowds out savings and investments and thus slows down economic growth. There is also another stand that proposes that foreign aid has a conditional relationship with growth, accelerating growth only under some certain circumstances. A possible reason for the high variability of opinions on the benefits of foreign aid is that there is no generally accepted theory on the workings of foreign aid. Frameworks like the gap theory have been widely criticized in contemporary research leaving the employed frameworks highly subjective. Simon (1987) offers five criteria for economic aid disbursement. First, the recipient person or nation â€Å"needs† the help. Second, the recipient wants the help. Third, the gift will not have bad effects in the long run on the recipient or others. Fourth, the charity will be used more-or-less efficiently rather than largely wastefully or simply to obtain more money in a pyramid scheme. Fifth, the charity will not be useless to the giver. In addition, a lot of the conditional relationship between foreign aid and economic development is premised on differentiation of foreign aid categories. For instance, Annen and Kosempel (2007) differentiate between foreign aid as technical assistance (TA) and non-technical assistance (NTA). They believe that the policies which will be most effective in reducing international income disparities will be the ones that help reduce the productivity gap, and this is exactly what technical assistance is intended to do. They also explained that when foreign aid takes the form of technical assistance, it can have important effects on improving economic conditions in poor countries; at least when it is administered efficiently. Chatterjee and Turnovsky (2005) in their work classified foreign aid into ‘tied’ and ‘untied’. They posit that the link between foreign aid, economic growth, and welfare depends crucially on the mechanism through which a particular aid program, whether tied or untied, is absorbed by the recipient economy. 2. 9. 1Dissenting views On the other hand, the Cato Institute (2004) actually proffers negative economic impact. In their opinion: †¢ There is no correlation between aid and growth. †¢ Aid that goes into a poor policy environment doesn’t work and contributes to debt. †¢ Aid conditioned on market reforms has been a failure. †¢ Countries that have adopted market-oriented policies have done so because of factors unrelated to aid. There is a strong relationship between economic freedom and growth. †¢ Even aid intended to advance market liberalization can produce undesirable results. Such aid takes the pressure off recipient governments and allows them to postpone, rather than promote, necessary but politically difficult reforms. Easterly (2003) cha llenges the growth gap theory usually used to justify increase in foreign aid. He states that the â€Å"financing gap† model in which aid increases investment and that investment increases economic growth has dubious theoretical foundations and numerous empirical failings. It assumes a stable linear relationship between investment and growth over the short to medium term but there are sound reasons to doubt whether the incremental capital-output ratio is constant and thus whether the relationship from investment to growth is linear. A second key assumption of the model in which aid fills a financing gap and allows greater investment is that aid will actually finance investment rather than consumption. This assumption will hold true only if investment is liquidity-constrained and incentives to invest were favourable. Another opponent of the gap theory is Erixon (2005). He carried out a literature analysis of aid and economic growth by examining case studies of countries who have received considerable amounts of aid. He also contends that the reason countries are poor is not that they lack infrastructure; roads, railways, dams, schools or health clinics. Rather, it is because they lack the institutions of the free society: property rights, the rule of law, free markets, and limited government. He maintains that even in the face of sound policy, foreign aid fails to have the desired effect. According to him, there is much evidence supporting the view that aid largely has backed political regimes with little interest in growth and development. It would be much more sensible to scale back the levels of aid considerably; provide aid only to governments that are already reforming and agree to continue reforms; and make clear that aid will be available only for a strictly limited period. M’Amanja & Morrissey (2004), in their study contend with foreign aid–economic growth relationships based on the often wrong theoretical assumptions used as a basis for it. With respect to the stipulations of endogenous growth theory, high investment ratios do not necessarily lead to rapid economic growth; the quality of investment, its productivity, existence of appropriate policy, political, and social infrastructure are all determinants of the effectiveness of investment. Time series was used to investigate this relationship in the Kenyan economy. They focused on one element of growth and used a multivariate approach on time series data for Kenya over the period 1964 – 2002 to investigate the growth effects of foreign aid, investment and a measure of international trade. In addition, some opposition to foreign aid comes from social biases. An example is Mutambara (2008) who claims that although the stated intention is ostensibly to assist the poor economies, most foreign aid benefits the donor countries. The modus operandi has been that the rich West provides financial assistance or loans to poor nations to engage Western consultants or institutions to carry out unsustainable and useless projects on the continent. As a result, there is minimum benefit to the African country while the money is recycled back via western institutions. The Cato Institute (2004) gave its position based on economic freedom. They assert that the greater a country’s economic freedom, the greater its level of prosperity over time. Economic freedom, which includes not only policies, such as free trade and stable money, but also institutions, such as the rule of law and the security of private property rights, does not only increase income. It is also strongly related to improvements in other development indicators such as longevity, access to safe drinking water, lower corruption, and lower poverty rates. Radelet (2006) examines aid magnitudes and who gives and receives aid. It discusses the multiple motivations and objectives of aid, some of which conflict with each other. It then explores the empirical evidence on the relationship between aid and growth, which is divided between research that finds no relationship and research that finds a positive relationship (at least under certain circumstances). It also examines some of the key challenges in making aid more effective, including the principal-agent problem and the related issue of conditionality, and concludes by examining some of the main proposals for improving aid effectiveness. Karras (2006) investigates the relationship between foreign aid and growth in per capita GDP using annual data from the 1960 to 1997 period for a sample of 71 aid-receiving developing economies. More specific studies like Asiedu and Nandwa (2004) focused on whether foreign aid in education has a significant effect on growth. In carrying out their study on the effect of foreign education aid they took into consideration the heterogeneous nature of aid as well as the heterogeneity of aid recipients—they disaggregated the aid data into primary, secondary and higher education, and ran separate regressions for low income and middle income countries. Neanidis and Varvarigos (2005) examined the effects of aid transfers and their degree of volatility (different kinds of variability) on economic growth. They conducted regression analysis for a panel of 74 aid-recipient countries over the time period from 1972 to 1998. Bhandari et al. (2007) carried out a region specific study the effectiveness of foreign aid and foreign direct investment in the Czech Republic, Estonia, Hungary, Latvia, Lithuania and Poland. They used a model that includes the labour force, capital stock, foreign aid and foreign direct investment, and is estimated using pooled annual time series data from 1993 to 2002. Before carrying out the estimation, the time series properties of the data were diagnosed and an error-correction model was developed and estimated using a fixed-effects estimator. Inanga and Mandah (2008) examines the role of two foreign aid financing agencies, Enterprise Development Fund (EDF) and Export Development Programme (EDP), in promoting Zambia’s economic growth in a country study. They assessed and analysed the impact of each of them on the growth and development of different sectors of the Zambian economy. The sector impact analysis included manufacturing, agriculture, transport, and institutional capacities. Al Khaldi (2008) analyses the trend and impact of foreign aid on the economic development of Jordan during the period 1990-2005 using for this purpose different statistical techniques. Chatterjee and Turnovsky (2005) introduced two crucial aspects of this mechanism that have been absent from previous work: the importance of the endogeneity of labor supply as an additional margin through which foreign aid may impact on macroeconomic performance; and the role played by the interaction of labor supply and public capital; and externalities associated with public capital accumulation in determining an economy’s response to a foreign aid shock. They suggest that when donors decide on whether a particular aid program should be tied to an investment activity, careful attention should be paid to the recipient’s opportunities for substitution in production, the elasticity of labour supply, and production externalities. It is perfectly possible for a tied transfer to have a presumably unintended adverse effect on the recipient economy, if that economy is structurally different from what the donor perceived. Durbarry, Gemmell and Greenaway (2004) assessed the impact of foreign aid on growth for a large sample of developing countries. They used an augmented Fischer-Easterly type model and estimated this using both cross-section and panel data techniques. This allowed them to identify not only the ceteris paribus growth effects of aid using an established conditioning set of policy variables, but also to assess the robustness of this set to the inclusion of aid, and other forms of, investment finance among the growth determinants. Annen and Kosempel (2007) tested the hypothesis that the effectiveness of aid depends on its level of fragmentation. The study presented a theoretical growth model for a small open economy that was capable of identifying the appropriate specification required for an aid-growth regression. 2. Empirical findings Annen and Kosempel (2007) found that non technical aid (NTA) has no statistically significant impact on growth; but technical aid (TA) has a positive and significant impact, except in countries where it is highly fragmented. A possible explanation for this result is that the savings rate applied to NTA is low, and therefore most of these resources are used to finance consumption instead of investment. Although the policy interaction term for NTA was found to be positive, as expected; the partial impact of NTA conditional on policy was found not to be statistically significant for any policy level. When aid takes the form of TA our results showed that it has a strong positive and statistically significant impact on economic performance. Specifically, their estimates show that for the average developing economy a 25% increase in TA will lead to about a quarter percentage point increase in its yearly growth rate. Their estimates indicate that when the level of fragmentation is high – above 73%, the partial impact of TA on growth is zero or even negative, depending on the estimation procedure. Asiedu and Nandwa (2004) also gave a conditional aid – growth relationship. They report that the effect of aid varies by income as well as by the type of aid. These results underscore the importance of the heterogeneity of aid flows as well as the heterogeneity of recipient countries when analyzing the effect of aid on growth. Aid depends on the level of development of the recipient country (low and middle income) as well as the level of education at which aid is being targeted (primary, secondary or higher). Aid in primary education enhances growth in low income countries but aid in post-primary education has no significant effect. For middle income countries, aid in primary education and secondary education has an adverse effect on growth but aid in higher education enhances growth. Thus, their results highlight the importance of taking into account the heterogeneity of aid and the heterogeneity of the recipient countries when analyzing aid-growth relationships. Sound policy is another condition given for aid to be beneficial. In the view of Al Khaldi (2008), policies are also important in the effectiveness of the foreign capital inflow, as aid has a more positive impact on growth with good fiscal, monetary and trade policies. In the presence of poor policies, on the other hand, aid has no positive effect on growth. Accordingly, there is a need of not only good policies but also the implementation of these policies as well as the proper monitoring of the aid -utilizing projects is necessary in order to avoid the mis-utilization and the mismanagement of the foreign capital resources. However, according to M’Amanja & Morrissey (2004), aid in the form of net external loans is found to have a significant negative impact on long run growth. Private investment relates to government investment and imports negatively, but positively to foreign aid though they note that the negative association between aid and growth may be due to their use of aid loans rather than grants.. Private investment has been a consistently strong determinant of growth both in the short- and long- run. The implication here is that in order to stimulate and sustain economic growth in Kenya, policy makers need to pay closer attention to factors that determine private investment. However, some findings disregard these conditions and oppose the benefits of foreign aid altogether. The results from Bhandari et al. (2007) indicate that an increase in the stock of domestic capital and inflow of foreign direct investment are significant factors that positively affect economic growth in these countries. Foreign aid did not seem to have any significant effect on real GDP. Rwabutomize (2008) reports that empirical findings reveal that foreign aid has no impact on economic growth amongst the low-income economies under investigation within the Sub-Sahara Africa region from 1990-2004. He concludes that the growth process of poor economies have not benefited from the official development assistance (foreign aid) inflows and increasing aid will not have a positive impact of growth either. Thus these economies should rely on other development resources other than foreign aid such as their domestic savings and tax revenues. Radelet (2006) came up with similar conclusions. Aid can keep bad governments in power for too long, and can undermine incentives for saving, tax collection, and private sector production. Aid relationships are made much more difficult by a complex chain of principal-agent problems that weaken information flows, introduce myriad motivations for different actors, and make monitoring and accountability more difficult. Inanga and Mangah (2008) in their study support these findings. According to them, although Zambia has, on the average, received aid of about US$ 514 million annually over the past three decades, its per capita income has declined from US$1,251 in he early 1970s to about US$ 600 in the late 1990s. They concluded that although it may be difficult to separate the effects of foreign aid finance from those of other growth-inducing factors, efficient and effective utilization of foreign aid finance can contribute to growth in a stable macroeconomic environment. As stated already, not all findings opposed the notion of beneficial foreign aid. The results from Karras (2006) show that the effect of foreign aid on economic growth is positive, permanent, statisticall y signi? ant, and sizable: raising foreign aid by $20 per person of the receiving country results in a permanent increase in the growth rate of real GDP per capita by approximately 0. 16 per cent. Using an alternative foreign-aid measure, a permanent increase in aid by 1 per cent of the receiving economies GDP permanently raises the per capita growth rate by 0. 14 to 0. 26 per cent. Wangwe (2009) states that a survey of three generations of empirical work found a consistent pattern of results. It found that aid increases aggregate savings, aid increases investment and there is a positive relationship between aid and growth in reduced form models. In Durbarry, Gemmell and Greenaway (2004) results vary according to income level, levels of aid allocation and geographical location. They report a positive coefficient on foreign aid as defined by the Organization for Economic Co-operation and Development (FAIDOECD) in 1993 as a percentage of the gross domestic product (GDP), significant at 10%. Point estimates indicate that raising the aid/GDP (or domestic savings/GDP) ratio by one percentage point raises the growth rate by about 0. 10 percentage points. Finally, adopting an alternative measure of foreign aid – aid per capita – yields similar results, confirming a positive and significant impact on growth. Panel data also yields similar results. And lastly according to Neanidis and Varvarigos (2005), on the one hand, devoting aid inflows into productive public spending promotes growth while the related volatility has a damaging effect. On the other hand, the non-productive use of aid transfers has an adverse effect on growth while their volatility is growth-enhancing. They proffer that the general onclusion emerging from their analysis can be summarized as follows: when aid is used productively (unproductively) it has, on average, a positive (negative) effect on growth while its respective volatility has a negative (positive) growth effect. Our results propose that recipient countries should allocate the aid they receive on the most productive uses, while donors should make sure that aid provision is the least erratic p ossible. 2. 10 DEFINITION OF TERMS Economic growth: For the purpose of this study, economic growth will be represented by the annual Gross Domestic Product at current factor cost. Labour force: Labour in this context consists of the number of people aged 15 and over who are employed (that is those who currently have jobs). Individuals who do not fall into either of these groups such as the unemployed, retired people and discouraged workers are not included in the calculation of the labour force. Unemployment: The International Labour Organization (ILO) defines unemployment as the proportion of the labour force which was available for work but did not work for at least one hour in the week preceding the survey period. However, the definition used here is that of the National Bureau of Statistics (NBS), Nigeria. The NBS defines unemployment as the proportion of the labour force that is available for work but did not work for at least 39 hours in the week preceding the survey period. Foreign Aid: is the economic help provided to communities of countries due to the occurrence of a humanitarian crisis or for the achievement of a socioeconomic objective. Foreign direct investment (FDI): FDI is an investment in real assets where real assets consist of physical things such as factories, land, capital goods, infrastructure and inventories. CHAPTER THREE THEORETICAL FRAMEWORK AND METHODOLOGY . 1INTRODUCTION The aim of this study is to examine the relationship between foreign aid and economic growth in Nigeria. This section starts with a theoretical framework then continues with a description of the model to be used for quantitative analysis. The regression is run using Ordinary least squares technique. The theoretical framework of this study is taken from theories, concepts, views and models. 3. 2TH EORETICAL FRAMEWORK This study uses the theoretical framework employed by Ogbuaku, Adebisi and Feridun (2006) based on the neoclassical growth model by Barro (1991). It is based on a small open economy version of the Solow (1956)-Swan (1956) growth model. The decision to study foreign aid in an open economy, as opposed to a closed, is three fold. First, most of the economies that receive foreign aid must reasonably be considered small and open. Second, to the extent that international credit markets are imperfect, some forms of foreign aid can have a positive impact on the poor. Third, in our empirical work we provide statistical evidence to suggest that greater international openness and access to credit stimulates economic growth. The two-gap model can also be employed. The first gap is the gap between the amount of investment necessary to attain a certain growth rate and the available domestic saving. Easterly (2003) examined the investment-savings gap. It goes thus: economic growth depends on investment as a share of GDP, adjusted by a factor that reveals whether investment is of high or poor quality. The amount of investment will be the sum of domestic savings and foreign aid. The model of the â€Å"financing gap† approach thus makes two key assumptions. First, it assumes the above stable linear relationship between investment and growth over the short to medium run. This assumption grows out of a Leontief-style production function with fixed requirements for capital and labour per unit of output. A second key assumption of the model in which aid fills a financing gap and allows greater investment is that aid will actually finance investment rather than consumption. This assumption will hold true only if investment is liquidity-constrained and incentives to invest were favourable. If the cause of low investment is due to poor incentives to invest, then aid will not increase investment. (Easterly, 2003) . 3 RESTATEMENT OF RESEARCH HYPOTHESIS H0: Foreign aid has no significant impact on the reduction of poverty and hence the economic growth of Nigeria. H1: Foreign aid has a significant impact on the reduction of poverty and the economic growth of Nigeria. 3. 4 RESEARH DESIGN 3. 4. 1MODEL SPECIFICATION This study uses the theoretical framework employed by Ogbuaku, Adebisi and Feridun (2006) based on the neoclassical growth model by Barro (1991). The y specify a simple model of poverty and globalization as follows: POV  =     ? 0+1 ? TRADE+ ? FDI+  µÃ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦(1) This model is augmented to include the foreign aid element thus: POV =      ? 0+ ? 1TRADE+ ? 2FDI + ? 3AID+  µÃ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦(2) Where POV is the yearly average per capita income trade is import + export /gdp fdi is foreign direct investment aid is foreign aid  µ is the stochastic error term 2. SOURCES OF DATA The analysis will be based on time series data of AID, TRADE, FDI and POV for the Nigerian economy for the period 1981 – 2007. These are secondary data collected from publications of Central Bank of Nigeria such as statistical bulletin and annual reports. 4. METHOD OF DATA ANALYSIS As stated in the introduction to this study, the Ordinary Least Squares (OLS) method of regression analysis is used in this research work. The OLS is one of the most commonly employed and most important methods in estimating relationships in econometrics. Furthermore, to contain the problems associated with time series data, a unit root test; the Augmented Dickey-Fuller (ADF) test, is employed to test for stationarity. Other methods applied include Johansen co-integration and error correction model. 3. 5. 1Augmented Dickey-Fuller (ADF) test Augmented Dickey-Fuller (ADF) test is used to test the stationarity in time series. Stationarity refers to the constancy in mean and variance of time series over a period of time. This will enable us to know if there is co-movement in time series in long run equilibrium. It is the augmented version of the Dickey-Fuller test for a larger and more complicated set of time series model. Stationarity test reveals the presence or absence of random-walk (unit root) in regression analysis. If the time series are non-stationary it means that our regression is spurious and as such estimates cannot be used to predict future values. The time series can then be adjusted in order to make them stationary. The augmented Dickey-Fuller (ADF) statistic used in the test is a negative number. The more negative it is, the stronger the rejections of the hypothesis that there is a unit root at some level of confidence. 3. 5. 2Johansen Co-integration This especially has been developed to overcome the problems of spurious regression which is associated with non-stationary time series data, in such instances, econometric results may not be ideal for policy making. The theory of co-integration arises out of the need to integrate short run dynamics with long run equilibrium. In cases where the data series exhibit the presence of unit roots, short-run dynamics properties of the model can only be captured in an error correction model when the existence of co-integration has been established. On this note, if variable are co-integrated, it shows that such variable possess the capacity to reach equilibrium in the long run. 5. LIMITATIONS TO THE STUDY Using economic growth as a measure of the influence of foreign aid on poverty in Nigeria assumes that there is adequate distribution of wealth in the Nigerian economy such that gains in economic output is transmitted to poor areas. It is possible that this is not the case. In addition, it is necessary to note that the use of regression techniques always comes with limitations. The first is the common warning that correlation does not mean causation. Therefore, even if a relationship is established between the examined variables, this does not guarantee that the occurrence of one necessitates the occurrence of the other. CHAPTER FOUR EMPIRICAL ANALYSIS AND PRESENTATION OF DATA 4. 1 INTRODUCTION In this chapter, the statistical data gathered during the course of this research work is subjected to investigation and analysis. The chapter starts with the brief explanation of various criteria for decision making, followed by the analysis of the static regression equation. In order to test for the presence of unit root (i. e. , spuriousness) in the static regression equation, stationarity test would be conducted using Augmented Dickey Fuller Test (ADF), while co-integration test using Johansen Co-integration test would also be conducted in order to establish the long-run co-movement among the variables. Finally, the error correction model will be used to test the relationships between the variables. . DECISION MAKING CRITERIA The following criteria for decision making are used in the analysis. Coefficient of determination (R2): The R-squa