Saturday, January 25, 2020

The Idiot Savant Essay -- Exploratory Essays Research Papers

The Idiot Savant   Ã‚  Ã‚   An idiot savant is defined as a person who is incredibly adept at one particular skill but is completely incapable in other aspects of life such as learning, reading, writing and decision making. The term idiot savant was applied to people with this disorder in 1887 by Dr. J. Langdon Down. The term idiot savant is basically an oxymoron. "Idiot" means someone who is in a class of people with an IQ less than 25, and "savant" comes from French and literally means "learned one." People can be born idiot savants, or it can be acquired later in life, even as late as adulthood. The major mystery with idiot savants is that they don't learn the knowledge they have, they just mysteriously have it.    Many people who are idiot savants are autistic. Approximately ten percent of people with autistic disorder have some savant skills. Only one percent of people with other forms of mental disability have savant skills. However, since other forms of mental disability are more common than autism, it turns out that fifty percent of idiot savants have au...

Thursday, January 16, 2020

Health Policy Week

Could it be that the healthcare system wants the issue to rise because that is how they make their money, or is it because not enough studies or programs exist for those people who have no insurance and can't get the necessary help they need to attack the problem? This paper will talk about and confront the many problems and concerns of obesity and will depict how the healthcare personnel can address the situation. II. Identifying Patients at Risk A. Economic despair and the geographic locations play a major part in obesity In America. African Americans are the race that is feeling the oppression of obesity.B. Blacks, those who are middle-aged, and lower-income adults continue to be the groups with the highest obesity rates. The healthcare law could help reduce obesity among low-income Americans if the uninsured sign up for coverage and take advantage of the free obesity screening and counseling that most insurance companies are required to provide under the law (Sharpe, 2013). Ill. Obesity and the Health Policy A. ) Many health officials are offering nutrition advice for obese patients but been proven ineffective at the individual levels. B. Obesity causes many chronic illnesses. Some illnesses include diabetes, high blood pressure, liver diseases, and some form of cancers to name a few. IV. Increased Health Cost Caused by Rising Obesity A. ) Surgeries are being done to assist people with losing weight. Gastric banding and gastric bypass surgery are what personnel are relying on to lose weight and the cost isn't cheap. B. ) Obesity healthcare cost is staggering in the United States. Physicians are probably putting the disease on the bottom of their to-do list because that is where they are making their money.

Wednesday, January 8, 2020

Investment appraisal should add value to business entity - Free Essay Example

Sample details Pages: 6 Words: 1866 Downloads: 4 Date added: 2017/06/26 Category Business Essay Type Argumentative essay Did you like this example? Successful companies are always keen to develop and grow by investing in the new projects to sustain and maintain their strategic position in the competitive market. Therefore companies always adopt strategic planning approach also known as corporate planning for long-term which in result gives direction to the company. One of the key areas in Strategic planning is strategic decision making by the senior management, to manage the available funds by the firm , right choice of investments by using strategic analysis approach and considering whether the options meet and are consistent with the firms objectives and are acceptable to main stakeholders.. Don’t waste time! Our writers will create an original "Investment appraisal should add value to business entity" essay for you Create order Financial Management analyse their available options of investments by focusing on the size of the funds need to commit to purchase lands, buildings etc, expected inflows and outflows in the future, life span of the investment and degree of risk involved in the investment. Then the management select the best possible options which are economical and profitable for the firm. This approach is known as investment appraisal. The investment appraisal process is concerned with assessing the value of future cash flows compared to cost of investment. The above discussed investment appraisal approach also contributes and on the following aspects of the business. Replacing the obsolete assets with newly developed assets. Enhancement of current products and development of new products. Increase in existing market share and introduction of new markets. Objective based fair decision making by analysing all possible alternatives Investments in profitable projects which adds value to the business. Realistic budgeting and cash flow forecasting. Considers risk involved in the projects. Therefore it can be clearly seen that Investment Appraisal approach in decision making also adds value to the Business along with selecting the most economical and profitable choices for the business in long term. Calculate payback period, NPV and IRR for each project. For each of the above methods which projects should be selected and explain why? Payback Period Method Project A Project B Year Net Cash flow Cumulative Cash flow Net Cash flow Cumulative Cash flow 0 (10,000) (10,000) (25,000) (25,000) 1 3,000 (7,000) 6,500 (18,500) 2 3,000 (4,000) 7,000 (11,500) 3 3,000 (1,000) 7,500 (4,000) 4 3,000 2,000 7,500 3,500 5 3,000 5,000 8,000 11,500 Payback period 3.33years 3.53years The above results shows that payback period of initial outlay of project A is 3.3 years which means 3 years and 4 months whereas the payback period of investments of project B is 3.5 years which means almost 3years and six months and in longer than project A, therefore projects A is more feasible compare to Project B in terms of payback of initial investment. Net Present Value Project A Year Cash flow DF @ 12.5% Present Value 0 (10,000) 1.000 (10,000) 1 3,000 0.889 2,667 2 3,000 0.790 2,370 3 3,000 0.702 2,106 4 3,000 0.624 1,872 5 3,000 0.555 1,665 NPV pound;680 Project B Year Cash flow DF @ 12.5% Present Value 0 (25,000) 1.000 (25,000) 1 6,500 0.889 5,779 2 7,000 0.790 5,530 3 7,500 0.702 5,265 4 7,500 0.624 4,680 5 8,000 0.555 4,440 NPV pound;694 Based on the Net Present Value calculation both projects have positive NPV and therefore will be suitable for the investments and will generate profits for the firm in future. We will therefore select to invest in project B because it has high NPV compare to project A. Internal Rate Of Return Project A Year Cash flow DF @ 10% Present Value 0 (10,000) 1.000 (10,000) 1 3,000 0.909 2727 2 3,000 0.826 2478 3 3,000 0.751 2253 4 3,000 0.683 2049 5 3,000 0.621 1863 NPV @ 10% pound;1,370 IRR= 10+ 1370 x (12.5-10) 1370-680 14.96% Project B Year Cash flow DF @ 10% Present Value 0 (25,000) 1.000 (25,000) 1 6,500 0.909 pound;5,909 2 7,000 0.826 pound;5,782 3 7,500 0.751 pound;5,633 4 7,500 0.683 pound;5,123 5 8,000 0.621 pound;4,968 pound;2,414 IRR= 10+ 2414 x (12.5-10) 2414-694 13.51% As indication from the above results of IRR, Project A would be accepted by project manager and potential investors. In both projects, cost of capital is same i.e. 12.5% but IRR of project A is 14.96% compare to 13.51% of project B. As per general rule, if resulted IRR is more than the interest rate then it should be acceptable but in our given scenario we will invest in project A because it has more difference between IRR and its cost of capital compare to project B. D) Explain why it is essential that discounted cash flow should be calculated when making Long Term Investment decisions. Discounted cash flow analysis is a procedure whereby the value of future cash flows are discounted back to present values using the discounted rate based on the cost of the capital available for the project, so that the economic values of future cash flows are comparable despite of timing difference. In the dearth of discounted future cash flows, resulted NPV and IRR will not appraise the project in real term and will not reflect the true picture of the investment appraisal. The key idea behind is that the value of money decline over time period due to the impact of inflation factor in eroding spending power. Investors normally like to receive their money back as soon as possible because it creates opportunities to invest new and upcoming ventures. In contrast, short term investment for instance the project for the year or less, the cash flows do not need to discount back and not require dealing with inflation .It is therefore essential to discount the cash flow so the impact of inflation and taxation on cash flows can be incorporated in projecting long term investments. E) What would happen to the NPV if; The cost of capital increased The cost of capital decreased The Net Present Value uses discounting to compute the present value of all future cash flows linked with the project The Net Present Value rely on the cash flow pattern and cost of capital which is applied. Any changes in the cash flows or in cost of capital will directly affect the resulted NPV and therefore project implementation as well. If cash flows are stagnant and cost of capital is variable then NPV will be indirectly proportional to the cost of capital. . If cost of capital increases, it affects discount factor and present value of future cash flows will decrease resulting lower NPV until reaches to negative NPV in which case investment of project will be rejected. If the cost of capital decreases then NPV will increase as can be seen in the following illustration on given date of Project B. Project B Year Cash flow PV @ 10% PV @ 12.5% PV @ 15% 0 (25,000) (25,000) (25,000) (25,000) 1 6,500 5,909 5,779 5,649 2 7,000 5,782 5,530 5,292 3 7,500 5,633 5,265 4,928 4 7,500 5,123 4,680 4,290 5 8,000 4,968 4,440 3,832 pound;2,414 pound;694 (pound;1,010) F) Explain why the NPV of relatively long term project is more sensitive to change in cost of capital than is the NPV of a short term project. One of the drawbacks of using NPV as capital budgeting specially for long term project is to accurately calculate discount rate for the project life. The NPV based on the estimated future cash flows which are to be discounted back to their present value by using discount rates whereas investments do not need to discounted because of time 0 .Also during calculating NPV of the project there can be multiple key variables which would be sensitive and the smallest changes produces the biggest results in project NPV. In reality project may have several variables which can be affected the resulted NPV and are sensitive for the project but if we concentrate and observe only the discount rate in isolation we can find that even minor change in discount rate can either adversely affect or improve the resulted NPV of the project. Therefore to select an appropriate interest rate is quite significant In the above table, we can observe as discount rates changes from 10% to 15%, the resulted NPV also changes from positive pound;2,414 to negative pound;1,010 which will not be acceptable to investors. The interest rate used for discounted should be equal to required rate of return which means that if investments would have invest to best available project or lower cost of financing .To establish effective and stable discount rate for long term projects hardly is an exact science. In real term discount rate may vary every year or even change during the year due to inflation and risk. In short term projects, inflation and risk factors do not affect a lot to interest rate comparatively in long term projects where these can affect the interest rate for each year. If we incorporate the different discount rates for each year this made NPV more complex model so lower rate of interest would be more appropriate to the extent that a long term project implies secure income stream. G) How does change in cost of capital affects the projects IRR? IRR uses discounting in a slightly different way to determine the profitability of an investment. The IRR is defined as the discount rate at which NPV value equals zero. For example in Project B, an investment yields net present value of pound;694 when discounted as 12.5 %. When we reduced the rate of interest to 10% then the resulted NPV rise to pound;2,414 and IRR was 13.51% which depicts the efficient and break even interest rate for the investment. As per general rule, IRR should be more than the discount rate then the company should invest in the project. Project B Year Cash flow PV @ 10% PV @ 12.5% PV @ 15% 0 (25,000) (25,000) (25,000) (25,000) 1 6,500 5,909 5,779 5,649 2 7,000 5,782 5,530 5,292 3 7,500 5,633 5,265 4,928 4 7,500 5,123 4,680 4,290 5 8,000 4,968 4,440 3,832 pound;2,414 pound;694 (pound;1,010) IRR= 10+ 2414 x (12.5-10) 2414-694 13.51% IRR= 10+ 694 x (15-12.5) 694+1010 15.40% As it is evident in the above calculation that if discount rate changes to then resulted IRR also changes. At 12.5% and 10% discount rates IRR is 13.51% compare to IRR of 15.40% when uses NPV by discounting at 12.5 % and 15% . In both cases IRR is higher than the discount rates and is acceptable for the project. But margin of change in interest rate second scenario is only 0.40% which can be highly risky in volatile market. h) Compare the effectiveness of NPV method with that of IRR method. There are different approaches in capital budgeting which can be used which can used investment appraisal. NPV and IRR are most popular approaches and two faces of same coin and but there are some key limitations in both approaches. The investment on the project is accepted if NPV is greater than zero after ranking NPVs of all the projects and normally provide clear indication whether to accept or reject the project whereas IRR is accepted if it is greater than cost of capital, both approaches gives different results. NPV gives result in real term means in currency whereas IRR is represented in percentage which is easy for project managers to compare with required rate of return , interest rare and inflation rate. IRR percentage can also use for managerial appraisal during divisional performance. Research also shows that NPV approach is preferred to IRR because it also incorporates and calculates additional wealth which IRR does not cover. IRR also does not give the freedom to discount the cash flows at different discount rates which is possible in the case of NPV method. If cash flows are fluctuating and inconsistent, IRR does not seems to be conclusively applicable in these circumstances where as NPV method would pose no challenge to this problem as it will take the net effect of all cash outflow and inflow and will provide the average return of the investment NPV and IRR both are difficult in the context of to estimate the accurate discount rate to use. This leads problem towards risk premium which affect the riskiness of the project. Therefore alternative approaches of investment appraisal should also be considered like sensitivity analysis, profit. In small projects Net Present Value and IRR does not generally employed. Normally projects involves variety of risks and different methods are used which gives better understating regarding the returns of investments and practical benefits of IRR and NPV calls into question and put some practical limitation in use of these methods.