Argumentative Essay Of Mice and Men Essays

Argumentative Essay Of Mice and Men Essays Argumentative Essay Of Mice and Men Essay Argumentative Essay Of Mice and Men Essay Essay Topic: Argumentative Of Mice and Men Making decisions can be easy, however making beneficial decisions is difficult. In the novella, Of Mice and Men by John Steinbeck, one of the leading characters, George Milton, faces series of decisions where life could change drastically based on his choices. His most difficult decision in the novel is killing his best friend, Lennie. Lennie Small, an ironically huge man with a disability that causes him to act and think like a child, ends up in a position where George can no longer stand up for him against the consequences of the â€Å"accident† towards the end of the novella. He makes the decision to shoot Lennie in the back of his head for both of their benefits. George’s decision is ultimately justified because of the meaningful friendship between the two men, the suffering Lennie would have endured caused by the discrimination based on the social hierarchy, and the unintentional problems Lennie would cause in the future. Also, even though i t could be considered â€Å"morally wrong† for someone to kill their best friend, George’s reason for his decision essentially outweighs the â€Å"immorality.† The two men’s friendship reveals a special relationship that is uncommon amongst the stereotypical migrant workers of the Great Depression. At this time when men independently searched for jobs, Lennie and George depend on each other.Furthermore, their friendship is similar to the connection between Candy and his dog. In the middle of the novella, Candy is encouraged to kill his own dog, who created a stench in the bunkhouse, and he replies: â€Å"‘No,’ he said softly. ‘I could’ do that. I had ‘im too long’† (Steinbeck 45). Candy and his dog spent most of their lives together that they become part of each other. Lennie and George also spend the majority of time together, creating a bond that helped George make the decision to kill Lennie for his benefit. In comparison, just as Candy’s old dog is not the most beneficial d

Final Reflection Essays - Educational Psychology, Education

Final Reflection Essays - Educational Psychology, Education Final Reflection Jessi Benanti EXP 105 Personal Dimensions of Education Cassidy Hawf January 6, 2016 Final Reflection Paragraph 1: What is Learning At the time that I started this course I had a tapered meaning of learning. I thought learning meant acquiring knowledge or a set of skills by experience, by being taught, or by studying. Throughout this class I have acquired a more in-depth understanding of what learning means. According to Jhnston (page 1.2) learning is taking in world around you and connecting to way you are experiencing. This is just the tip of the ice burg when it comes to learning, as you gain the knowledge from the world around you, learning requires that as you start to understand what you are making sense of the knowledge that you will finally come to understand what you are experiencing. As Johnston stated learning involves using your critical thinking skills and sound judgment to respond appropriately to any workplace task, online assignment, or opportunity to speak publicly (page 1.2). Not only is learning understanding knowledge, but also understanding how you come to understand that knowledge. There are four types of learning patterns, Sequence, Precision, Technical Reasoning, and Confluence. As a learner you should try to understand what type of learner you are. Once you figure out your unique pattern, you will be able to learn more intentionally. Paragraph 2: Describing yourself as a Learner When it comes to my learning patterns, I normally use them where I am most comfortable. My LCI scores are Sequence-32, Precision-35, Technical Reasoning-25, and Confluence-19. As a person that is a Strong-Willed Learner, I typically use sequence, precision, and technical reasoning first. When it comes to learning I typically use sequence to start out all my assignments so I have list that lets me know where to start and where to end. As I am learning I then like to use my precision to make sure that I have all the information for the assignment. I also like to use my technical reasoning to work on solving the problem that is in front of me. This is what I do when I am really trying to answer a question. I sometimes use my confluence pattern to brainstorm new ideas for papers and discussions. As a learner I have had to understand how my patterns work together. I have learned that each pattern has its own task in what I am doing. While doing an assignment I have found that I use each p attern as its own special task to help me understand a do the work. When I take in the world around me I have learned to use my precision more than each of my other patterns. I look for the information that is in the world and make sure I have the knowledge of the world so I can learn everything. Paragraph 3: Combination of Learning Patterns The combination of my learning patterns has made me a Strong Willed Learner. As a Strong Willed Learner I can easily switch from pattern to pattern. I have been able to use two or more of my patterns to get my work done. As a Strong Willed Learner I have been able to use my unique patterns to get my assignments done on time. Being a Strong Willed Learner I have the biggest benefit of getting my BA and being able to get the job I really want. I have been able to find the perfect quiet place to get my reading and work done. When I am taking my tests I normally use both my laptop and my phone, my laptop for my test, and my phone for my book. With having both precision and sequence as two of my use first patterns, I always find all the information for my assignments and discussions first and then write a rough draft on word, check my work for spelling and grammar errors, and then I post it in the classroom. As I analyze the benefits of my unique combination of learning patterns, I have b een able to identify the things that I need to do to complete all my readings, assignments, quizzes, and discussions for this course. Paragraph 4: FITing Learning Patterns I believe as a strong

Unit 6 Assignment Example | Topics and Well Written Essays - 500 words

Unit 6 - Assignment Example Imbalances in wage structure arise when there is a deviation from the optimum wage set by the self-regulating system in the economy. I feel there are imbalances in the wage structure in our economy. The labor market comprise of different types of workers differing from one another in a number of ways with the job differing in characteristics both in terms of wage and in terms of other nonmonetary attributes (Mankiw, 2011). In order to protect employees from exploitation by their employers, the government sets a minimum wage limit. This has been of help raising the wages of the less skilled compared to what they would have earned in a labor market that is unregulated. However, despite this, the wages of some workers have been set above the equilibrium level arising to disequilibrium in the labor market (Mankiw, 2011). We can also attribute this to compensating differentials which refers to the difference in wages which arises from other nonmonetary characteristics of various types of jobs which is quite prevalent in our economy. An example would be employees with similar qualifications but since one works during a night shift earns more. Employees deployed to work in hardship conditions may be compensated more compared to employees with similar qualifications but working under friendly environments. Human capital is the accumulation of investment in people with the most explication of it being education. The perspective of demand and supply postulates that there exists a correlation between high wages and the level of education. Additionally, firms demanding for labor tend to be more willing to pay more for the highly educated employees since they tend to have higher marginal productivity due to their proficiency (Mankiw, 2011). On the other hand, the suppliers of labor tend to also be more willing to pay the costs of becoming educated only if there is a reward for that. Thus the difference in wages between the highly educated

Nursing Essay Example | Topics and Well Written Essays - 1500 words - 2

Nursing - Essay Example Interest in professionalizing the nursing occupation emerged in healthcare organizations in 1970s. This stemmed from the need to provide a substitute motivation for workers with blocked access to structures of mobility and that the ideological draw of professionalism offered the promise of higher degree of control. (Barker 2008, p. 9) Here, it is important to underscore that profession through their scientific credibility becomes a source of power and prestige. Indeed, it arises out of self-interest and provides a means by which occupational groups exert influence to advance their own interest in society. By professionalizing the nursing profession, it was expected that traditional collective action such as unionism would be countered and that nurses, being educated as professionals in colleges and universities, were expected to exercise their knowledge and skills without bureaucratic constraint. The classical criteria that make a field or profession professional were posited in 1915 by Abraham Flexner, an imminent sociologist, who outlined several qualities. The most important of which follows: Flexner’s qualities for professionalism stressed rationalism, scientific standards and objectivity. These criteria were addressed by the model that conceptualized nursing professionalism, the Miller’s Wheel. In the wheel model, the center represents the essential foundation of nursing education in an institution of learning and, according to Miller: Each of the eight spokes represents other behaviors deemed necessary in maintaining or increasing nurses’ professionalism. They are competence and continuing education; adherence to the code of ethics; participation in the primary and referent professional organizations, i.e., ANA and state constituent member associations; publication and communication; orientation toward community services; theory and research development and utilization; and

Study on Financial Analysis of Britannia Essay Example for Free

Study on Financial Analysis of Britannia Essay The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food and food processing technologies, skills and equipment, especially in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing. Fruits Vegetables, Fisheries, Milk Milk Products, Meat Poultry, Packaged/Convenience Foods, Alcoholic Beverages Soft Drinks and Grains are important sub-sectors of the food processing industry. A health food and health food supplement is another rapidly rising segment of this industry which is gaining vast popularity amongst the health conscious. India is one of the worlds major food producers but accounts for less than 1. 5 per cent of international food trade. This indicates vast scope for both investors and exporters. Food exports in 1998 stood at US $5. 8 billion whereas the world total was US $438 billion. The Indian food industries sales turnover is Rs 140,000 crore (1 crore = 10 million) annually as at the start of year 2000. The industry has the highest number of plants approved by the US Food and Drug Administration (FDA) outside the USA. Indias food processing sector covers fruit and vegetables; meat and poultry; milk and milk products, alcoholic beverages, fisheries, plantation, grain processing and other consumer product groups like confectionery, chocolates and cocoa products, Soya-based products, mineral water, high protein foods etc. We cover an exhaustive database of an array of suppliers, manufacturers, exporters and importers widely dealing in sectors like the -Food Industry, Dairy processing, Indian beverage industry etc. We also cover sectors like dairy plants, canning, bottling plants, packaging industries, process machinery etc. The most promising sub-sectors includes -Soft-drink bottling, Confectionery manufacture, Fishing, aquaculture, Grain-milling and grain-based products, Meat and poultry processing, Alcoholic beverages, Milk processing, Tomato paste, Fast-food, Ready-to-eat breakfast cereals, Food additives, flavors etc. India is one of the world’s major food producers but accounts for less than 1. 5 per cent of international food trade. This indicates vast scope for both investors and exporters. Food exports in 1998 stood at US $5. 8 billion whereas the world total was US $438 billion. The Indian food industry’s sales turnover is Rs 140,000 crore (1 crore = 10 million) annually as at the start of year 2000. The industry requires about Rs 29,000 crore in investment over the next five years to 2005 to create necessary infrastructure, expand production facilities and state-of-the-art-technology to match the international quality and standards. The office of the Agricultural Affairs of the USDA / Foreign Agricultural Services in New Delhi says that one of India’s proudest accomplishments has been achieving a tenuous self-sufficiency in food production and that the country produces a wide variety of agricultural products at prices that are at or below world values in most cases. The Indian palate is accustomed to traditional foods, mostly wheat and rice-based, rather than potato and corn-based western palate. In marketing perspective, this is considered an important factor for foreign marketers. The USDA report says initially consumer-ready food products may have to be tailored to include Indian spices and traditional ingredients. In addition to traditional tastes, there are other social factors which affect consumption in India. Hindus account for approximately 80 per cent of India’s population, and while only 25 or 30 per cent are strict vegetarians, beef slaughter is prohibited in all but two states (Kerala and West Bengal) and consumption of other meats is limited. Incidentally, India is the only country where the US-based MacDonalds sells its burgers without any beef content and even offers purely vegetarian burgers. India’s middle class segment will hold the key to success or failure of the processed food market in India. Of the country’s total population of one billion, the middle class segments account for about 350-370 million. Though a majority of families in this segment have non-working housewives or can afford hired domestic help and thus prepare foods of their taste in their own kitchens, the profile of the middle class is changing steadily and hired domestic help is becoming costlier. This is conducive to an expansion in demand for ready-to-eat Indian-style foods. India’s food processing sector covers fruit and vegetables; meat and poultry; milk and milk products, alcoholic beverages, fisheries, plantation, grain processing and other consumer product groups like confectionery, chocolates and cocoa products, Soya-based products, mineral water, high protein foods etc. According to latest official statistics, India exported processed fruits and vegetables worth Rs 5240 million in 1997-98. The horticulture production is around 102 million tones. Foreign investment since 1991, when economic liberalization started, stood at Rs 8,800 crore. Products that have growing demand, especially in the Middle East countries include pickles, chutneys, fruit pulps, canned fruits, and vegetables, concentrated pulps and juices, dehydrated vegetables and frozen fruits and vegetables. Another potential processed food product is meat and poultry products. India ranks first in world cattle population, 50 per cent of buffalo population and one-sixth of total goat population of the world. Buffalo meat is surplus in India. There is vast scope to set up modern slaughter facilities and cold store chains in meat and poultry processing sector. India’s current level of meat and meat-based exports is around Rs 8,000 million. In last six years foreign investment in this segment stood at Rs 5,000 million which is more than 50 per cent of the total investment made in this sector. Compared with meat, poultry industry has registered significant growth. India ranks fifth in the world with annual egg production of 1. 61 million tones. Both poultry and egg processing units have come in a very big way in the country. India is exporting egg powder, frozen egg yolk and albumin powder to Europe, Japan and other countries. Poultry exports are mostly to Maldives and Oman. Indian poultry meat products have good markets in Japan, Malaysia, Indonesia and Singapore. While meat products registered a growth of 10 per cent, eggs and broilers registered 16-20 per cent growth. There are about 15 pure line and grandparent franchise projects in India. There are 115 layer and 280 broiler hatcheries producing 1. 3 million layer parents and 280 million broiler parents. They in turn supply 95 million hybrid layer and 275 million broilers, day-old chick. Presently there are only five egg powder plants in India which is considered insufficient in view of growing export demand for different kind of powder whole egg, yolk and albumen. The scope of foreign investment and state-of-the-art technology in this field is therefore tremendous. Milk and milk products is rated as one of the most promising sectors which deserves foreign investment in a big way. When the world milk production registered a negative growth of 2 per cent, India performed much better with 4 per cent growth. The total milk production is around 72 million tones and the demand for milk is estimated at around 80 million tones. By 2005, the value of Indian dairy produce is expected to be Rs 1,000,000 million. In last six years foreign investment in this sector stood at Rs 3600 million which is about one-fourth of total investment made in this sector. Manufacture of casein and lactose, largely being imported presently, has good scope. Exports of milk products have been decimalized. Grains could emerge as a major export earner for India in coming years. India’s food grains production is now at around 225-230 million tones. These include rice, jawar, bajra, maize, wheat, gram and pulses. Indian basmati rice enjoys command in the international market. Besides growing Middle East market for basmati rice, many other countries are showing interest for this food grain. In 1998-99, export of basmati and non-basmati rice stood at Rs62000 million. There is a total rice milling capacity of 186 million tons in the country. Among plantation, tea emerged as major foreign exchange earner. India is the largest producer and exporter of black tea. However, the most worrying factor for Indian tea industry is that from early next year with the implementation of tea imports into the country, India tea may face a stiff competition within the country as well, specially threat of Sri Lanka’s presence in the Indian market is looming large. The current year’s tea export prospect is not that very good in terms of forex earnings because international prices have fallen significantly this year. India exports between150-170 million kilograms of tea per annum. Of course, the scope of foreign investment in this sector is good and the multinational tea companies would either be trying for marketing joint ventures with the Indian producers or acquire stakes in Indian tea companies. There is a strong possibility of third country exports through such joint venture as quality wise still Indian teas are ruling the international market. An alcoholic beverage is another are where India witnessed substantial foreign investment. Foreign investment in this sector stood at Rs 7000 million which about 70 percent of the total investment made so far. The IMFL (Indian Made Foreign Liquor) primarily comprises wine, vodka, gin, whisky, rum and brandy. Draught beer is a comparatively recent introduction in the Indian market. The Indian beer market is estimated at Rs7000 million a year. One of the major advantages for any investor eyeing the Indian liquor market is that India offers enough raw materials like molasses, barely, maize, potatoes, grapes, yeast and hops for the industry. Yet another catchy investment sector is fisheries. There is growing canned and processed fishes from India. The marine fish include prawns, shrimps, tuna, cuttlefish, squids, octopus, red snappers, ribbon fish, mackerel, lobsters, cat fish etc. In last six years there was substantial investment in fisheries to the tune of Rs 30,000 million of which foreign investments were of the order of Rs 7000 million. The potential could be gauged by the fact that against fish production potential in the Exclusive Economic Zone of 3. 9 million tones, actual catch is to the tune of 2. 87 million tones. Harvesting from inland sources is around 2. million tones. The biggest bottleneck in expanding the food processing sector, in terms of both investment and exports, is lack of adequate infrastructure. Without a strong and dependable cold chain vital sector like food processing industry which is based mostly on perishable products cannot survive and grow. Even at current level of production, farm produce valued at Rs 70,000 million is being wasted every year only because there is no adequate storage, transp ortation, cold chain facilities and other infrastructure supports.

Death is a New Beginning Essay -- Literary Analysis, Emily Dickinson

Death is a New Beginning Death is like two paths on a trail. Some see it as the end of the road while others see it as a beginning of a new adventure. In the poems â€Å"Because I Could Not Stop for Death† by Emily Dickinson and â€Å"Crossing the Bar† by Alfred Lord Tennyson, both authors choose to view death as a new journey rather than an ending. In the poem, â€Å"Because I Could Not Stop for Death† the author portrays the expedition of death as a gentle carriage ride throughout the entire poem where â€Å"Death† is personified as a gentleman caller and Immortality acts as the speakers chaperone on this voyage. The carriage takes the speaker on a ride from her childhood to her grave and beyond. Similarly, in â€Å"Crossing the Bar† Tennyson describes death as a journey through picturing death as a ride out to sea. Through choice of image both authors portray their vision that death is a journey and that death should not be feared. Finally, though death is not to be f eared, both speakers regard it from very different points of view. The person speaking in Tennyson’s poem is still alive; he is an old man waiting to die. In contrast, Dickinson’s speaker is a young woman who is surprised by death. In short, death is for both seen as an exciting new adventure. The first instance where it is evident that the authors are of the opinion that death should not be feared but rather to embrace the expedition is proven by the ways in which both authors use diction. In the first poem â€Å"Because I Could Not Stop for Death† the poem talks about the gentle ride that the person is experiencing. ...w he will be â€Å"putting out to sea†. In sum, each different speaker has their own respective point of view on dying such as Dickinson’s character did not know that death was going to come so soon. In contrary, Tennyson’s character was very aware that his time was on earth coming to an end. Although both authors have different points of view, both authors feel the same about death, as they both see death as a new expedition. In Conclusion, death is seen for both a new expedition. Dickinson’s voyage is going on a carriage ride with Death and Immortality guiding her to â€Å"eternity†. Tennyson’s adventure however is represented through crossing the sandbar into the large ocean. These poems are both reassuring and comforting for the readers to help themselves understand that death should not be feared but rather to think of death as a new beginning rather than an ending.

Aspen Tech case study Essay

History and Overview †¢Ã¢â‚¬ ¯ Specialized in the development of simulation software for customer in process manufacturing industries †¢Ã¢â‚¬ ¯ Advanced System for Process Engineering (ASPEN) project conducted at the Massachusetts Intitutes of Technology (MIT) in Cambridge Massachusetts, from 1976 to 1981 †¢Ã¢â‚¬ ¯ Founded in 1981 by Dr. Larry Evans, a professor of chemical engineering at MIT †¢Ã¢â‚¬ ¯ Larry Evans†leadership in the development and application of integrated systems for modeling, simulation and optimization of industrial chemical process History and Overview †¢Ã¢â‚¬ ¯ In 1982 its first year of operations, AspenTech lost USD565,000 on sales of USD182,000 †¢Ã¢â‚¬ ¯ Over next 13 years AspenTech’s sales grew rapidly as it became a major payer in the process simulation segment of the software industry. †¢Ã¢â‚¬ ¯ 1995 company earned net income $5.4 million on sales $57.5 million. AspenTech estimated that it commanded 50% of the simulation market for chemical sector. †¢Ã¢â‚¬ ¯ 1995, it employed 417 people of which 265 ware based in the US and the remainder in office in 5 countries. History and Overview †¢Ã¢â‚¬ ¯ AspenTech went public in USDD31 million IPO which included a USD 18 Million primary offering and USD 13 Million secondary offering : –†¯ to finance further R&D –†¯ to acquire externally developed technologies –†¯ to allow early investors to monetize their holdings in the company, †¢Ã¢â‚¬ ¯ Feb1995, Aspentech conducted a $23 million public offering, which included a USD 1 million primary offering and USD 22 million secondary offering. †¢Ã¢â‚¬ ¯ 1995, AspenTech was the only one of the firms that specialized in simulation programs for chemical petroleum, and petrochemicals industries that was publicly traded. Products (versi makalah) †¢Ã¢â‚¬ ¯Aspen Plus Aspen Plus is the most popular product a steady state modeling system built around the core technology This product accounted 48% of sales in 1995 †¢Ã¢â‚¬ ¯Speed UP It was AspenTech’s dynamic process modeling product commercialized in 1986 by Prosys Tecknology that AspenTech purchased in 1991 †¢Ã¢â‚¬ ¯Max It is a less powerful version of Aspen Plus †¢Ã¢â‚¬ ¯Advent A software to optimize the tradeoff between capital expenditures for energy saving heat exchangers and the energy saving realized   Product Portfolio (versi makalah) †¢Ã¢â‚¬ ¯ Properties PLUS It is a database of chemicals properties underlying its other products, popular with customers ~ developed in-house modeling software †¢Ã¢â‚¬ ¯ Other modules –†¯ offers to the customers ~ license separately –†¯ use with its other products to model subsystems used in highly specialized chemicals processing application. Product Portfolio (versi web) †¢Ã¢â‚¬ ¯Process Engineering – – – – – – – – Process simulation Chemicals (10 products : AspenPlus) Process simulation Oil&Gas (8 products : AspenHYSYS) Process simulation Refining (11 products : Aspenadsim+) Process simulation Batch/Pharma (8 products :Aspenproperties) Model Deployment (3 products : AspenModelrunner) Equipment modeling (8 products :AspenAcol+) Basic Engineering (2 products :AspenKbase) Economic Evaluation (3 products : Aspn Icarus Project Manager) †¢Ã¢â‚¬ ¯Advance Process Control (14 products : Aspen Apollo, Aspen IQ) †¢Ã¢â‚¬ ¯Planning & Scheduling (10 products : Aspen Advisor, Aspen MBO) †¢Ã¢â‚¬ ¯Supply & Distribution (3 products : Aspen Retail) †¢Ã¢â‚¬ ¯Production Management & Execution (16 products : Aspen 0server) Sales & Marketing †¢Ã¢â‚¬ ¯1995, licensed to more than 450 companies ~ chemical industry and 350 univerities †¢Ã¢â‚¬ ¯The selling cycle for process modelling software was long (6-12 months) †¢Ã¢â‚¬ ¯AspenTech charged a premium over competitors products, raise licensing fees three times (1998-1995)~10% †¢Ã¢â‚¬ ¯Customer loyalty –†¯ Over 90% renewed their software –†¯ 1994 : 34% revenue from software renewal; 34% from expansion from existing customer †¢Ã¢â‚¬ ¯United States : –†¯ Directs sales force –†¯ Earned combination of salary & commission †¢Ã¢â‚¬ ¯Sales subsidiaries : UK, Japan, HongKong, Brussels –†¯ Serve local & regional markets via directs sales forces †¢Ã¢â‚¬ ¯Licensed software for a non-cancelable term ~ 3 or 5 years †¢Ã¢â‚¬ ¯Charge : –†¯ annual fee x license term (year) –†¯ Interest rate 9.5% – 11% currently 12% †¢Ã¢â‚¬ ¯Customer were more likely to buy software priced in local currency Risk Exposure 1.†¯ Foreign Exchange Risk – – – – sell software in local currencies  installment from three-to-five years creates foreign exchange exposure exchange rate fluctuations 52% revenue generated from foreign company with following revenues figures: †¢Ã¢â‚¬ ¯ Europe 31% †¢Ã¢â‚¬ ¯Asia 12% †¢Ã¢â‚¬ ¯Other countries 9% †¢Ã‚  In United State 48%. Risk exposure are might be applicable :Transaction Exposure (High) most the costumer operated outside of US Translation Exposure (Low) convert foreign currency financial statements into a single currency (USD). Risk Exposure 2. Interest Rate Risk (low) –†¯ AspenTech debt using US dollar currency fix interest rate and mid term (3years) –†¯ place a seasonal line-of-credit facility with a New England Bank Risk Exposure 3.†¯Credit Risk –†¯Ã‚  Credit risk (default risk) in high exposure level 2 sources probability trigger this risk: growing rapidly customer choose to defer payment of their license over the life of the contract Ex: AspenTech was liable for $ 4,6 million of this amount under limited recourse agreement Unwilling (Low) most of the customers are a loyal customer Unable (High) depend on the type of business of customer Liquidity Risk many of its customers chose to defer payment of their licenses over the life of the contract the company usually experienced an operating cash shortfall Ex: the firm booked revenue of USD57.5 million, yet receive cash payments directly from customers of only $38.5 million (66.96%). Management Risk Perform by AspenTech Foreign Exchange Risk eliminated all sales transaction exposure arising from foreign currency denominated license contract inline with its risk management policy by doing hedging : –†¯ Sale non USD installment receivable for USD –†¯ forward currency agreement Credit Risk –†¯ AspenTech has not managed the risk of the uncollectible installment –†¯ The contract with GE and Sanwa in selling the account receivable has limited recourse agreement   Liquidity Risk –†¯ To manage its liquidity risk in order to cover their day to day operation, AspenTech sell its receivable to GE and Sanwa and other financial institution. –†¯AspenTech also has debt to Massachusetts Capital Resources –†¯ placed a seasonal line of credit facility with New England bank. Recommendation AspenTech’s should reexamine the firm risk management policies and practices in light of the changes : –†¯ over the past year AspenTech’s international sales had remained a substantial portion of its revenues –†¯ the firm international expenses had increase a slightly faster rate than its international revenue –†¯ AspenTech had gone from private company into a publicly traded company AspenTech’s should review and determine an acceptable level of risk. It involves determining reasonable level of risk in-line with appropriate opportunity to gain Recommendation Net Foreign Exchange Exposure (Operational Hedging) AspenTech’s Value at Risk, 1995 (95% confidence level) UK Pound German DM Belgian Franc Japanese Yen Expenses in local currency 3,129 722 158,223 414,793 Monthly Std. Deviation 2.90% 2.80% 2.70% 3.00% Exchange Rate* 1.5873 0.6711 0.0326 0.0106 Total *Average exchange rate (U.S. dollar per unit of foreign currency) over fiscal year 1995 VaR $238 22 230 218 $707 AspenTech’s Net Foreign Exchange Exposure (‘000) by Currency, 1995 Cash Inflows UK Pound German DM Belgian Franc Japanese Yen Current Sales 1,724 1,015 308,984 Prior Sales 981 577 175,781 Cash Outflows Expenses 3,129 722 158,223 414,793 AspenTech should hedge only the net exposure †¢Ã¢â‚¬ ¯ Net foreign exchange exposure in German and Japan †¢Ã¢â‚¬ ¯ Forward contract for Belgian’s operating expense Net Exposure (424) 870 (158,223) 69,972 Recommendation Liquidity & Credit Risk –†¯ AspenTech should look other possibility to deal with other financial institution to increase their bargaining position to GE and Sanwa With higher bargaining position, AspenTech can get lower cost and better position in managing their credit risk –†¯ Maximize in selling long term receivable first Recommendation Others Hedging Instrument : –†¯ Plain-Vanilla Options give the buyer of the option the right but not the obligation to buy (call) or sell (put) a specific amount of currency at a predetermined strike price (exchange rate High cost –†¯ Average-Rate Options †¢Ã¢â‚¬ ¯ Spot rate are calculated as an average over a period †¢Ã¢â‚¬ ¯ Transaction possible during the expiry period at several predetermined dates †¢Ã¢â‚¬ ¯ Strike rate can be fixed or floating –†¯ Knock-in/knock-out Options †¢Ã¢â‚¬ ¯ Does not provide full protection †¢Ã¢â‚¬ ¯ The key is in determining the barrier rate †¢Ã¢â‚¬ ¯ Low cost –†¯ Cross-currency transactions –†¯ Foreign currency money-market borrowing Recommendation †¢Ã¢â‚¬ ¯ Others Hedging Instrument : –†¯ Cross-currency transactions †¢Ã¢â‚¬ ¯ transaction basically does not provide ability to hedge or secure any risk †¢Ã¢â‚¬ ¯ provide probability of arbitrage if there is a difference between cross rate and indirect rate. –†¯ Foreign currency money-market borrowing †¢Ã¢â‚¬ ¯ Borrowing in the money market, rather difficult to use since the company need to determine level of debt that matched with its cash inflow from other matched currency