The International Monetary Fund and World Bank Group

The International Monetary Fund (IMF) and the World Bank Group are two global institutions created to assist nations in becoming and remaining economically viable. Each plays an imporant role in the environment of international trade by helping maintain stability in the financial markets and by assisting countries that are seeking economic development and restructuring. Inadequate monetary reserves and unstable currencies are particularly vexing problems in global trade.So long as these conditions exist, world markets cannot develop and function as effectively as they should. To overcome these particular market barriers that plagued international trading before World War II, the International Monetary Fund (IMF) was formed. Originally 29 countries signed the agreement; now 184 countries are members. Among the objectives of the IMF are the stabilization of foreign exchange rates and the establishment of freely convertible currencies to facilitate the expansion and balanced growth of i nternational trade.Member countries have voluntarily joined to consult with one another to maintain a stable system of buying and selling their currencies so that payments in oreign money can take place between countries smoothly and without delay. The IMF also lends money to members having trouble meeting financial obligations to other members. Argentina, Turkey, and Greece have recently received such help from the IMF, but the results have been mixed. To cope with universally floating exchange rates, the IMF developed special drawing rights (SDRs), one of its more useful inventions. Because both gold and the U. S.  dollar have lost their utility as the basic medium of financial exchange, most monetary statistics relate to SDRs rather than dollars.The SDR is in effect â€Å"paper gold† and represents an average base of value derived from the value of a group of major currencies. Rather than being denominated in the currency of any given country, trade contracts are frequen tly written in SDRs because they are much less susceptible to exchange-rate fluctuations. The special drawing right (SDR) is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries.Countries can exchange SDRs for hard currency at the IMF. The SDR also serves as the unit of account of the IMF and some other international organisations. Its value is based on a basket of key international currencies. The SDR is in some ways like a currency, but is currently used only at the IMF. The value of the SDR is based on the exchange rates of the US dollar, the euro, the yen and the pound sterling. The basket composition is reviewed every five years to ensure that it reflects the relative importance of currencies in the world’s trading and financial systems.Although the International Monetary Fund has some severe critics,43 most agree that it has performed a valuable service and at least partially achieved many of its obj ectives. To be sure, the IMF proved its value in the financial crisis among some Asian countries in 1997. The impact of the crisis was lessened substantially as a result of actions taken by the IMF. During the financial crisis, the IMF provided loans to several countries including Thailand, Indonesia, and South Korea. Had these countries not received aid ($60 billion to Korea alone), the economic reverberations might have led to a global recession.As it was, all the major equity markets reflected substantial reductions in market prices, and the rate of economic growth in some countries was slowed. Sometimes confused with the IMF, the World Bank Group is a separate institution that has as its goal the reduction of poverty and the improvement of living standards by promoting sustainable growth and investment in people. The bank provides loans, technical assistance, and policy guidance to developing country members to achieve its objectives.The World Bank Group has five institutions, e ach of which performs the following services: (1)Lending money to the governments of developing countries to finance development projects in education, health, and infrastructure (2)Providing assistance to governments for developmental projects to the poorest developing countries (per capita incomes of $925 or less) (3) Lending directly to the private sector to help strengthen the private sector in developing countries with long-term loans, equity investments, and other financial assistance.Providing investors with investment guarantees against â€Å"non-commercial risk,† such as expropriation and war, to create an environment in developing countries that will attract foreign investment (5)Promoting increased flows of international investment by providing facilities for the conciliation and arbitration of disputes between governments and foreign investors. It also provides advice, carries out research, and produces publications in the area of foreign investment law.Since thei r inception, these institutions have played a pivotal role in the economic development of countries throughout  the world and thus contributed to the expansion of international trade since World War II. Protests against Global Institutions Beginning in 1999, what some are calling â€Å"anti-capitalist protesters† began to influence the workings of the major global institutions described previously. The basic complaint against the WTO, IMF, and others is the amalgam of unintended consequences of globalization: environmental concerns, worker exploitation and domestic job losses, cultural extinction, higher oil prices, and diminished sovereignty of nations.The anti-globalization protests first caught the attention of the world press during a WTO meeting in Seattle in November 1999. Then came the World Bank and IMF meetings in April in Washington, DC, the World Economic Forum in Melbourne, Australia, in September, and IMF/World Bank meetings in Prague, also in September 2000. S ome 10,000 protesters faced some 11,000 police in Prague. And the protests45 and violence have continued at other meetings of world leaders regarding economic issues, such as the G20 meetings in London in 2009,46 and in individual countries affected by the IMF.Tragically, the terrorism in London was most likely timed to coincide with the G8 meetings in Scotland in 2005. Regardless of the theoretical approach used in defense of international trade, the benefits from an absolute or comparative advantage clearly can accrue to any nation. Heightened competitors from around the world have created increased pressure for protectionism from every region of the globe at a time when open markets are needed if world resources are to be developed and utilized in the most beneficial manner.And though market protection may be needed in light of certain circumstances and may be beneficial to national defence or the encouragement of infant industries in developing nations, the consumer seldom benef its from such protection. Free international markets help underdeveloped countries become self-sufficient, and because open markets provide new customers, most industrialized nations have, since World War II, cooperated in working toward freer trade.Such trade will always be partially threatened by various governmental and market barriers that exist or are created for the protection of local businesses. However, the trend has been toward freer trade. The changing economic and political realities are producing unique business structures that continue to protect certain major industries. The future of open global markets lies with the controlled and equitable reduction of trade barriers.

Advantages and Disadvantages of Payback Assignment

Advantages and Disadvantages of Payback - Assignment Example Payback period is also an effective capital budgeting technique whereby the break-even point for an investment proposal is calculated. When investment is made in a project, there are no profits earned in the initial few years of operation. Profits are earned after the business achieves break even, where the level of investment made in the project becomes equal to the inflow of cash earned over the years. If the initial investment made in a project $150,000 and the cash flows each year is $50,000. Then the payback period as per the above formula is 3 years. At the end of the third year, the company will be able to recover the entire investment that it has made in the project. From the third year onwards the company would be earning profits upon the project. In case of two or more mutually exclusive projects, the management is seen to select the one which has a lower payback period (Baker and English, 2011). Payback period is one of the simplest capital budgeting techniques to appraise a given project. It is easy to use and simple to calculate. Payback period helps managers to understand the time period required to attain liquidity in a given investment proposal. It also helps the management to analyze the risk factor in a given investment proposal. The longer the duration of the project, the higher is the risk factor. Payback period does not take into consideration the time value of money. This is because the method does not take into consideration discounting of future cash inflows to arrive at the present value of net inflow. Payback period helps in understanding the liquidity factor associated with projects ignoring the profitability factor completely. The system takes into consideration only the inflow of cash prior to the payback period and does not consider the cash inflows after it (Bierman and Smidt, 2007).

Partnership Analysis Essay Example | Topics and Well Written Essays - 1500 words

Partnership Analysis - Essay Example These can be used with strategic intent, especially for gaining competitive advantage. We take the case of Ford Motor, the second largest car maker in the US. While Ford has built many IS with strategic aspects, we focus on the IS for supplier – Ford relations. Managers can use value chain analysis to identify opportunities to use IS for competitive advantage (Porter, 1985, 2001; Shank and Govindarajan, 1993). An organization (in our case, Ford) can be thought of as a big input – output process. This can be represented schematically as follows: Ford Motor purchases automobile components and services from automotive companies in the industry. So at the left end in the schematic, supplies are purchased and brought into Ford. Ford then integrates those supplies (components) and makes cars, which it markets to customers. Ford then provides customer service after it sells the cars. In this entire process, there are opportunities for people in Ford to add value in various stages of the process. For example, supplies can be acquired more effectively and value can be added. Some other examples are adding value in making cars and improving sales. This process of adding value throughout the organization is called the Value Chain of the organization. Value Chain Analysis is the process of analyzing the organization’s value chain to find out where value is added to products and services, and the costs of adding value. Since IS can automate many activities in the Value Chain, Value Chain Analysis is used widely in using IS for strategic competitive advantage. In this, one has to first draw the Value Chain and then flesh out each of the activities where value is added. Then costs are determined for such value addition activities. Then one has to compare and benchmark these activities with those of the competitors. Then one can use the appropriate IS for gaining competitive advantage. IS can be used at any

Case study Example | Topics and Well Written Essays - 500 words - 116

Case Study Example In addition, it strengthens during international turmoil (Balcerowicz, & World Bank Group, 2015). Unfavorable foreign exchange movements cause significant appreciation in Swiss franc against the Euro as well as other main currencies thereby challengingly affecting Swiss managers, employees, and firms (Butcher, 2011). According to the perspective of Swiss importing firms, the unfavorable exchange rate movements normally cause the prices of exports to increase thus weakening the customer demand. It makes the Swiss products to be more expensive abroad thus creating a negative impacts on their demand and this directly affects the sales revenue of companies (Horcher, 2013). On the other hand, unfavorable exchange rate movements greatly affect employees in terms of job loss and pay cuts. Low sales volume and profits due to low customer demand prompts firms to seek ways to survive and adapt by adjusting wages. Finally, it may force the managers to move their production to the euro zone in case they fail to cut wages and this also could cause more job losses at Mopac in Switzerland (Balcerowicz, & World Bank Group, 2015). I would have to move the production or the company to the euro zone because it is cheaper to produce in the region due to the weaker currency. Secondly I would have to cut wages to make the products cheaper thereby raising customer demand which in turn increases the sales volume and profits (Horcher, 2013). Thirdly, I would have to employ cross-border workers and pay them in Euros in order to cope with the appreciating Swiss franc. Finally, I would engage in simple currency diversification or currency hedging just like other large companies (Butcher, 2011). I would gladly accept Euros because it is weaker than the Swiss franc. The four options will greatly assist us in coping with the spike in Swiss franc (Balcerowicz, & World Bank Group,

Applied Law Essay Example | Topics and Well Written Essays - 250 words - 1

Applied Law - Essay Example This means that there is a promise made in return for something, which has already occurred. The promise to donate the receipts to the charity organization constitutes to insufficient consideration and cannot be enforceable (Adams, 2004). The formation of a contract takes place when what one party offers is accepted by the other party to the contract. Krauses cannot avoid the contract after learning that they could have sold the piece of land at a higher price than the price, which Jud offered. This is because they have already accepted the offer. Acceptance of the offer means that the Krauses bound themselves legally to the terms of the contract. Therefore, avoiding the contract could constitute to breach of contract. Krauses can only withdraw from the offer if they had not accepted the offer (Bhana, Bonthuys & Nortje, 2009). Jud can be held to pay the typewritten amount since a contract constitutes a legal agreement in writing between the two parties to a contract. This means that Jud is bound to pay the typewritten amount rather than the offered amount (Bhana, Bonthuys & Nortje,

REFLECTIVE LEARNING JOURNAL Essay Example | Topics and Well Written Essays - 500 words

REFLECTIVE LEARNING JOURNAL - Essay Example However, I was surprised to realize that it is not the faculty decision to change the evaluation methods. The decision is up to the dean of The Applied Medical Science who is not even a nurse. I think having such a bureaucratic system decreases innovation and creativity in a nursing college. It was great to know that yyyy University has modified its curriculum. More Nursing courses have been added to the program and include Nursing Informatics, Care of Older Adults, Principles of Education for Nurses, Counseling, Epidemiology, Nursing Theory, and Genetics for Nurses. I think adding these courses is a great move forward because it happens after hiring new faculties who get their PhDs in education from developed countries. This change makes me feel better about the future of nursing in Saudi Arabia because there is apt of improvement that just needs passionate personnel. The faculties were very welcoming and they accepted my ideas and me. Additionally, they were very encouraging especi ally because some of them had been my instructors when I was undergraduate student. They were also very proud of my accomplishments. That made me happy and more excited to go back to Saudi and contribute to the improvement of nursing education and ultimately nursing care in my country. I also feel grateful because I contributed to changes at Yanbu College in Yanbu city in Saudi Arabia. My brother is an associate professor at Yanbu Collage and teaches chemical engineering. I discussed with him the teaching pedagogies, the assessment, and evaluation methods I learned at xxxxx. At that time, I realized that having a PhD in a field does not mean that you can teach well. This is because my brother has a PhD in Chemical Engineering but he did not know how to be an effective educator. I was very excited telling him everything I could possibly remember from NUR 504, NUR 528, and NUR 600 courses. He liked the flipped classroom strategy

Western expansion and development Essay Example | Topics and Well Written Essays - 1000 words

Western expansion and development - Essay Example The immigrants from China faced a lot of discrimination upon arriving in the United States which was evident in the manner of treatment that they received in the mines. In 1850s, the U.S government limited the right of naturalization to the white immigrants only which made it difficult for Chinese immigrants to pursue independent livelihoods. The Missouri Compromise allowed for slavery to continue in the newly acquired states which meant that immigrants of African descent were to be treated as slaves and not as people who came in search for greener pastures. The Mexican War saw the expansion of the United States to parts of territories that initially belonged to Mexico. This made it easy for immigrants from Mexico to move to the country with most of them settling in the states of Texas and Oregon regions. The United States played a critical role in ending the Second World War. The nation initially tried to avoid entering the war even as pressure from the Britain mounted. They finally agreed to take part in it as it was seen as a threat to its security. During the Holocaust, the United States did not lower its tight stance on immigration and it is believed many Jews would have been saved if the laws were lessened to allow Jews immigrants into the country. The American Jewish community had undermined the impact of the Holocaust and they failed to consider advocating for the uplifting of more Jews from the affected areas. During the World War II period the American Jewish community was bitterly and deeply divided, and was unable to form a common front. Proponents of a Jewish state and Jewish army agitated, but many leaders were so fearful of an anti-Semitic backlash inside the U.S. that they demanded that all Jews keep a low public profile. The Bracero Program which was formed in the year 1942 saw the increase of immigrants from Mexico who mainly came into the United States to offer cheap labor. At the onset of World War II, the