...management and the collections of accounts receivable. Between 40 and 50 percent of Belco’s sales are made on open account terms and it is this team’s job to make sure customers fulfill their payment obligations. At any given time if just a few receivable’s turn into bad debts that need to be written off, Belco’s overall profitability will suffer markedly. Therefore, Belco has a standardized process for analysis of all potential customer’s credit and then granting only those will a solid past history of payment open account terms. In this case, Belco has granted Kooritsa Kiev open account terms and it appears this may have been a bad decision. Kooritsa Kiev has an outstanding receivable of $84,000(5,411,674 Rubles) with an additional receivable of $78,000(5,025,126 Rubles) due in 15 days. Belco and Kooritsa Kiev have been doing business with each other for over 4 years, in those 4 years Kooritsa Kiev has placed several large orders and has always paid promptly. Pam Arnold has no idea why they have fallen so far behind but she is not about to sacrifice Belco’s strong 30 year history of being able to collect on its account receivables. Pam has three options; One, to engage the customer further by contacting Sergei Barsov, Kooritsa Kiev’s purchasing agent or...
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...Introduction: The purpose of this report is to consider The Russian Crisis of 1998. What events led to this crisis, how it affected ordinary citizens and the effect it had on the world capital markets. We will also discuss the role IMF and other countries played in helping with the crisis. What the Russian government did in order to stabiles the situation and what role politics played in the process. We will use a number of sources in order to complete this report. Question One: What event is recognised as the beginning of the crisis? The Russian crisis begun on August 17th 1998 when the central bank of Russia announced that it would widen the intervention bands from ruble. It meant that the ruble was allowed to fluctuate against dollar. As a result, the exchange rate of the ruble fell steadily which led to a collapse in Russia economy. However, the crisis was not caused by a single event. It was a consequence of a continuing downward trend in Russia economy since its economic reform in 1991. The crisis’s seeds were sown from that day. The main causes of this crisis could be divided into 3 timelines: * Period 1991 – 1996: In 1991, Russia changed from a very strictly centralized economy to a market economy. Up until then, the Soviet played the most important role in subside all the state sectors. It consumed one-third of GDP and supported at least every third man, woman, and child (Roman, G & Robin, M – 1999). When the real prices were introduced, these state sectors...
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...management and the collections of accounts receivable. Between 40 and 50 percent of Belco’s sales are made on open account terms and it is this team’s job to make sure customers fulfill their payment obligations. At any given time if just a few receivable’s turn into bad debts that need to be written off, Belco’s overall profitability will suffer markedly. Therefore, Belco has a standardized process for analysis of all potential customer’s credit and then granting only those will a solid past history of payment open account terms. In this case, Belco has granted Kooritsa Kiev open account terms and it appears this may have been a bad decision. Kooritsa Kiev has an outstanding receivable of $84,000(5,411,674 Rubles) with an additional receivable of $78,000(5,025,126 Rubles) due in 15 days. Belco and Kooritsa Kiev have been doing business with each other for over 4 years, in those 4 years Kooritsa Kiev has placed several large orders and has always paid promptly. Pam Arnold has no idea why they have fallen so far behind but she is not about to sacrifice Belco’s strong 30 year history of being able to collect on its account receivables. Pam has three options; One, to engage the customer further by contacting Sergei Barsov, Kooritsa Kiev’s purchasing agent...
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...and privatization of Russia’s oil industry after the collapse of the USSR * Reorganized instead into an open joint-stock company * Valued between $60 to $80 billion * Rapid expansion and acquisitions * Including Northern oil, exploration and development licenses to several blocks * Growth in crude oil production, rising from 98.6 million barrels in 200 to 148.3 million barrels in 2004 * Was appointed by the Russian government as Russia’s representative in the negotiation of the multitude of production-sharing agreements, which it was signing with major oil producers from all over the world * Acquired Yuganskneftegas unit from Yukos through the Baikal Finance Group * Why does Rosneft want to do an IPO? * To pay off debts * $7.5 billion debt, borrowed from the National Oil and Gas Company of India * $1 billion in Russian capital gains taxes on the IPO itself * What does Rosneft’s owner want out of an IPO? * The Russian government did not want to lose control over the company (and was not sure what share it wished to float) * Wanted the highest possible proceeds for a share * To prevent the losses it had suffered in previous privatization efforts and was highly contentious about what a fair price would be for its stake * What are the key considerations in considering to do any IPO? * Credible leadership, Enterprise vision * A reasonable deal...
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...A REPORT ON THE BRICS COUNTRIES ECONOMIC POLICIES Submitted to Submitted by Prof. Padmakali Banerjee BA ECONOMICS HONS (4th sem) Contents 1. Introduction to BRICs 2. Brazil 3. Russia 4. India 5. China BRICS • In economics, BRIC is a grouping acronym that refers to the countries of Brazil, Russia, India and China which are all deemed to be at a similar stage of newly advanced economic development. • The acronym was coined by Jim O'Neill in a 2001 paper entitled "Building Better Global Economic BRICs" • It is typically rendered as "the BRICs" or "the BRIC countries" or "the BRIC economies" or alternatively as the "Big Four". • It has been replaced by BRICS since the 2010 inclusion of South Africa in the bloc. • In 2010, however, while the four BRIC countries accounted for over a quarter of the world's land area and more than 40% of the world's population. • Projections on the future power of the BRIC economies vary widely. Some sources suggest that they might overtake the G7 economies by 2027. • According to a paper published in 2005, Mexico and South Korea were the only other countries comparable to the BRICs, but their economies were excluded initially because they were considered already more developed, as they were already members of the OECD. Current leader Brazil - Dilma Rousseff, President China - Xi Jinping, President India...
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...MODULE 1 (Sarah Prady) Identifying Global Business Opportunities Global Business Opportunities We are a construction company that focuses on the future of the environment as well as people all over the world. We have a lot of experience, passion, and knowledge about constructing homes that are energy and meet the universal green standards. Our core business consists of constructing “green” homes for people to purchase in hopes to live a more eco friendly lifestyle in order to help save our planet and our future. Potential Markets Although there are several markets available all over the world right now, we are currently focusing our energy and attention on expanding and developing overseas in Russia. Unfortunately Russia is very advanced already and has recently begun to expand their business’s efforts towards reaching the consumers within the “green” market. Russia currently has one company that is already succeeding within this field due to the fact that they are local from the country, start up cost are high and equipment is more accessible. However, given the current economical conditions anything is possible and any business can be successful to those willing to take risks. Absolute and Comparative Advantage I would not say that Russia has a comparative or absolute advantage overall. We both have the equal resources and opportunities to gather materials necessary, we are both large in size, and we both have the same advances and availability of technological...
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...managers were reassessing the investment climate in Russia. Since the disintegration of Communism and the Soviet Union in 1991, western investors had been intrigued by the potentially huge returns that could be gained by participating in the restructuring of the Russian economy. Russia’s transformation to a market system, however, had been highlighted by missteps and disappointments. Foreign investors who had jumped into the market only eight months earlier were burned badly by a general market collapse in October. Furthermore, Russia’s political and economic future were uncertain. O Nevertheless, Russia possessed many attractive features that could reward those with the courage to invest at this early stage of market development. Russia’s natural resources accounted for significant portions of the world’s proven oil and gas, timber, coal, and minerals reserves. In addition, the privatization process, lack of internal capital, and country-specific risk resulted in valuations for Russian companies that seemed to be small fractions of their world peers. T Russia in 1995 was frequently compared to America’s “Wild West,” when the search for riches and general lawlessness combined to create very volatile conditions. While western money managers were drawn to Russia by tantalizing asset valuations and high market growth potential, they were quite nervous about committing their capital to these ventures, which usually suffered from poor management, no financial controls...
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...real against the dollar. The economic reforms in Brazil were fairly successful, the country saw the inflation rate drop to 2% by 1998 and the economy grew by 3 to 4% annually as well as foreign investment soaring to $ 22 billion in 1998, but not all was well. Brazil was facing a huge trade deficit due to an overvalued real. There were also huge budget deficits which were structural in nature. These structural problems required that the Brazilian constitution be amended which was proving to be problematic for the government. The real also faced challenges from the Asian financial crisis which triggered panic selling in all emerging markets. As the money began to flow out of Brazil the real was put under tremendous pressure and when the Russian...
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...real against the dollar. The economic reforms in Brazil were fairly successful, the country saw the inflation rate drop to 2% by 1998 and the economy grew by 3 to 4% annually as well as foreign investment soaring to $ 22 billion in 1998, but not all was well. Brazil was facing a huge trade deficit due to an overvalued real. There were also huge budget deficits which were structural in nature. These structural problems required that the Brazilian constitution be amended which was proving to be problematic for the government. The real also faced challenges from the Asian financial crisis which triggered panic selling in all emerging markets. As the money began to flow out of Brazil the real was put under tremendous pressure and when the Russian...
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...Hedging is a risk management strategy used in limiting or eliminating chances of loss from uncontrollable changes in the prices of commodities, currencies, or securities. A hedge is an investment position that used to reduce potential losses that may be occur in an investment for an individual or an organisation. In short, hedging is a transfer of risk without buying insurance policies. Hedge funds are designed to reduce an investment risk while maintaining a good return on investment. Hedging refers to managing risk to an extent that makes it bearable. In international trade and dealings foreign exchange play an important role. Fluctuations in the foreign exchange rate can have significant impact on business decisions and outcomes. Many international trade and business dealings are shelved or become unworthy due to significant exchange rate risk embedded in them. Hedging uses various techniques, it involves taking equal and opposite positions in two different markets (such as cash and futures markets). A hedge can be constructed from many types of financial instruments, including forward contracts, future contracts, options, swaps, many other types of over-the-counter and derivative products. Forward Contracts Generally, the most prominent instrument used in hedging for exchange rate risk management is the forward contract. Forward contracts are customised agreements between two parties to fix certain condition such as the currency exchange rate, interest rate or...
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...developments shaping today’s global marketplace. The articles cover a wide variety of topics ranging from technology, innovation and brand building to infrastructure, entrepreneurship and social impact. A section on consumer markets looks at the popularity of e-cigarettes in France and elsewhere, efforts by Japanese firms to expand their businesses into Asia, new trends in French gastronomy, changes in Japan’s traditional food-consumption habits, and how a sector of the Chinese population is spreading, and spending, its newfound wealth. The report offers an analysis linking market-driven strategies with social impact in Peru and Colombia, as well as an article describing South Carolina’s embrace of innovative research. Other articles look at the Russian government’s attempt to reboot the city of Skolkovo as an innovation hub, the mixed success of innovation efforts in China, and the growing threat of cybercrime to businesses across the world. The challenges of infrastructure and planning are addressed in analyses of transportation in areas of Latin America, deficiencies in Brazil’s infrastructure, and real estate’s impact on Peru’s emerging middle class. Business and politics underpin a number of economic forces, as noted in articles on corruption and protest in India, social unrest in Brazil, the potential of the gemstone tanzanite to help develop Tanzania’s economy, and growing frictions between China and Myanmar. Cities on the move in the global economy are examined in separate articles...
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...LAFFER ASSOCIATES Supply-Side Investment Research 10-yr T-Note: 4.27% DJIA: 10,538.66 NASDAQ: 2,057.37 CIC Securities January 6, 2004 S&P 500: 1,123.67 S&P 500 Undervalued: 56.7% THE LAFFER CURVE: PAST, PRESENT AND FUTURE1 By Arthur B. Laffer The story of how the Laffer Curve got its name isn’t one of the Just So Stories by Rudyard Kipling. It began with a 1978 article published by Jude Wanniski in The Public Interest entitled, “Taxes, Revenues, and the ‘Laffer Curve.’” As recounted by Wanniski (associate editor of the Wall Street Journal at the time), in December of 1974 he had been invited to have dinner with me (then professor at the University of Chicago), Don Rumsfeld (chief of staff to President Gerald Ford) and Dick Cheney (Rumsfeld’s deputy and my former classmate at Yale) at the Two Continents Restaurant at the Washington Hotel in Washington, D.C. (just across the street from the Treasury). While discussing President Ford’s “WIN” (Whip Inflation Now) proposal for tax increases, I supposedly grabbed my napkin and a pen and sketched a curve on the napkin illustrating the trade off between tax rates and tax revenues. Wanniski named the trade off “The Laffer Curve.” I personally don’t remember the details of that evening we all spent together, but Wanniski’s version could well be true. I used the so-called Laffer Curve all the time in my classes and to anyone else who would listen to illustrate the trade off between tax rates and tax revenues. My only question...
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...IBUS%3100%–%TEXTBOOK%NOTES% CHAPTER%1%–%GLOBALIZATION% WHAT%IS%GLOBALIZATION?% • Globalization:+ shift% towards% a% more% integrated% and% independent% world% economy% –% away% from% distinct% national% economic%units,%towards%one%huge%global%market% Merging%of%historically%distinct%and%separate%national%markets%into%one%huge%global%marketplace% Argument%–%tastes/preferences%of%consumers%in%different%nations%beginning%to%converge%to%some%global%norm%% Standardized%products%such%as%CocaTCola,%McDonald’s%and%iPods%help%create%a%global%market%% Significant%differences%still%exist%between%national%markets%along%many%dimensions,%i.e.%tastes/preferences,%distribution% channels,%value%and%business%systems,%and%legal%regulation% Most%global%markets%–%markets%for%industrial%goods%and%materials%that%serve%universal%need% Sourcing%of%goods/services%from%locations%around%the%globe%to%take%advantage%of%national%differences%in%cost%and%quality% of%factors%of%production%+ Aim%is%to%lower%overall%cost%structure%of%an%entity%and/or%improve%quality/functionality%of%product%offering%+ Impediments% to% global% production% include% –% formal/informal% barriers% to% trade,% barriers% to% foreign% direct% investment,% transportation%costs,%and%issues%associated%with%economic%+%political%risk+ Regulation,%management,%and%policing%of%global%marketplace%necessary%as%markets%globalize%further% General+Agreement+on+Tariffs+and+Trade+(GATT):+international%treaty%that%committed%signatories%to%lower%barriers%...
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...RESEARCH PAPER 99/14 11 FEBRUARY 1999 The Asian Economic Crisis This paper considers the economic crisis that began in the financial markets of South East Asia in 1997 and the consequences for the economies of the region and the rest of the world. The paper provides a chronology of and explores the factors that led to the crisis. An overview is given of the policy measures that the international financial institutions (IFIs), such as the IMF, have taken to deal with the crisis. Some of the arguments and policy proposals made to try to avoid future crises are also covered. Eshan Karunatilleka ECONOMIC POLICY AND STATISTICS SECTION HOUSE OF COMMONS LIBRARY Recent Library Research Papers include: 98/119 98/120 99/1 Unemployment by Constituency - November 1998 Defence Statistics 1998 The Local Government Bill: Best Value and Council Tax Capping Bill No 5 of 1998-99 16.12.98 22.12.98 08.01.99 99/2 99/3 99/4 Unemployment by Constituency - December 1998 Tax Credits Bill Bill 9 of 1998-9 The Sexual Offences (Amendment) Bill: 'Age of consent' and abuse of a position of trust [Bill 10 of 1998-99] 13.01.99 18.01.99 21.01.99 99/5 99/6 99/7 The House of Lords Bill: 'Stage One' Issues Bill 34 of 1998-99 The House of Lords Bill: Options for 'Stage Two' Bill 34 of 1998-99 The House of Lords Bill: Lords reform and wider constitutional reform Bill 34 of 1998-99 28.01.99 28.01.99 28.01.99 99/8 99/9 99/10 99/11 99/12 Economic Indicators Local Government...
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...UNIT - I Foreign Exchange Markets A Foreign exchange market is a market in which currencies are bought and sold. It is to be distinguished from a financial market where currencies are borrowed and lent. General Features Foreign exchange market is described as an OTC (Over the counter) market as there is no physical place where the participants meet to execute their deals. It is more an informal arrangement among the banks and brokers operating in a financing centre purchasing and selling currencies, connected to each other by tele communications like telex, telephone and a satellite communication network, SWIFT. The term foreign exchange market is used to refer to the wholesale a segment of the market, where the dealings take place among the banks. The retail segment refers to the dealings take place between banks and their customers. The retail segment refers to the dealings take place between banks and their customers. The retail segment is situated at a large number of places. They can be considered not as foreign exchange markets, but as the counters of such markets. The leading foreign exchange market in India is Mumbai, Calcutta, Chennai and Delhi is other centers accounting for bulk of the exchange dealings in India. The policy of Reserve Bank has been to decentralize exchages operations and develop broader based exchange markets. As a result of the efforts of Reserve Bank Cochin, Bangalore, Ahmadabad and Goa have emerged as new centre of foreign exchange market. ...
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