Procurement and Purchasing for Technological Force- MyAssignmenthelp

Question: Discuss about theProcurement and Purchasing for Technological Force. Answer: Strategies Reasons for Outsourcing by Company Outsourcing can be termed as a planned use of external resources to do activities which were usually handled by internal resources. It is a strategy in which specialised and experienced service providers are hired by an organisation to contract out their operational activities which are not central to their objectives. In several cases, transferring of employees from companies to outsourcing companies is also held. Outsourcing is important for the company as it helps in reduction of risks and to control its operating costs easily, along with this it helps in improving companys focus on core activities (Vetrkov, Marek and Milos, 2013). Another reason company chooses outsourcing is flexibility it provides partnering with an outsourcing company. The number one reason for selecting outsourcing is to reduce the cost as it will result in higher profit margins. Maximum use of external resources is there as it also frees internal resources to focus on other purposes. Outsourcing provides exp ertise service provides quicker and efficient services. Outsourcing also helps in improving services by hiring professional service providers. It assures companies to recognise the advantages of re-engineering. Forces Providing Preference to Outsourcing Technological Force Technological force helps in bringing better knowledge and great experience into Organization. By making use of outsourcing approach, outsourced operational activities will be updated with the latest technologies. For this, company will not require technological force as they can achieve their goals by paying to their outsourcing partners (Oshri, Julia and Leslie, 2015). Further, company will be able to avail the benefit of technology in minimum so as to reduce operational cost at the same time which can give better results. By outsourcing supplementary activities, management can develop technology for their core activities in order to enhance efficiency and productivity of business. In this manner they will be able to make improvement in their key performance indicators. Cost force Reducing of the cost is the main element for which company chooses outsourcing. One of the major objective of the company is to lower its cost as to achieve high profits. Proper execution of costs results in revenue identification (Schniederjans, Ashlyn and Dara, 2015). Outsourcing helps in controlling of companies operating cost easily. It also helps in reducing costs of sales by making reduction in cost salaries, infrastructure and other resources. By implementing outsourcing in their business strategies company can make optimise use of available resources by investing in core activities. Financial Force The concept of outsourcing makes elimination in the requirement of investment in infrastructure and in the cost of experts as this responsibility is taken by outsourcing partners. They provide assurance to the company for optimum infrastructure for the considered services to derive best possible outcome (Oshri, Julia and Leslie, 2015). This approach will make a reduction in the requirements of capital which will reduce finance costs of business. Outsourcing also provides a tax benefit to company tax shield for entire expense instantly without considering the concept of depreciation as infrastructure does not belong to the company. Organisation Force This is one of the major factors for which outsourcing is preferred by corporate entities. In accordance with this aspect, outsourcing reduces the burden for supplementary work so that workforce can focus on their primary activities to get efficient in their core competency. With this approach, the company will focus on developing the brand by achieving excelling in their core activities along with getting cost advantage of outsourcing (Kenyon, Mary and Peter, 2016). Further, they do not have work about ancillary activities as these will be managed by experts with perfection and optimum cost. The company can invest saved efforts and resources in research and development activities in order to provide value-added services. Revenue Force Outsourcing provides better accessibility to market through which company is able to get preferences of people in their core competency. It is because; with this approach, they are able to develop a network in the market in which they operate, and consequently they will get better interaction with the clients as well as distributors to services. In this manner, the enterprise will be able to attain competitive advantage (Awino and Jane, 2014). Outsourcing is a preferable and standardised way of inviting new blood through new ideas, possibilities and energy in business. This benefit can be accessed through the method of analysis and metrics in tracking the effectiveness of in-house management team. Consequently, success can be further refined for an accurate reflection of requirements of the company. References Awino, Zachary Bolo, and Jane Musangi Mutua. "Business process outsourcing strategy and performance of Kenyan state corporations."Journal of emerging trends in economics and management sciences5, no. 7 (2014): 37-43. Kenyon, George N., Mary J. Meixell, and Peter H. Westfall. "Production outsourcing and operational performance: An empirical study using secondary data."International Journal of Production Economics171 (2016): 336-349. Oshri, Ilan, Julia Kotlarsky, and Leslie P. Willcocks.The Handbook of Global Outsourcing and Offshoring 3rd edition. Springer, 2015. Schniederjans, Marc J., Ashlyn M. Schniederjans, and Dara G. Schniederjans.Outsourcing and insourcing in an international context. Routledge, 2015. Vetrkov, Milota, Marek Potkny, and Milos Hitka. "Outsourcing of facility management."E+ M Ekonomie a Management1 (2013): 80.

The Main Difference between Aristotles and Socrates Account of Virtue

Today people build their society and relations in it on the principles of ethics which were developed by such philosophers as Socrates and Aristotle in the ancient times. One of the main principles on which the ethical school is based is the notion of virtue as the representation of the moral perfectness of a man.Advertising We will write a custom essay sample on The Main Difference between Aristotle’s and Socrates’ Account of Virtue specifically for you for only $16.05 $11/page Learn More Moreover, virtue can also be defined as the way which a man should follow to live the better life which is full of light and goodness. Socrates and Aristotle are considered as the founders of the ethic principles. Socrates was the first who determined the notion of virtue, and Aristotle developed his own vision with basing on Socrates’ viewpoint. Thus, there are many similarities in the philosophers’ interpretation of virtue, but there is al so a significant difference in their approaches to the discussion of virtue which is influential for the organization of their ethical systems. This important difference is in determining the source of virtue as the moral category. Socrates considers virtue as the basis for understanding people’s morality. Virtue can be thought of as the complex of the best human qualities and traits which he develops consciously. Socrates determines four main virtues which exist in people’s lives. They are prudence (or personal wisdom), justice, temperance, and fortitude (Taylor, 2001). Following these four virtues is the men’s chance to live the better life because they are connected with all the aspects of people’s living including civil life and military service. However, a man cannot follow the principles of a virtuous life consciously when he does not know them. That is why to live a moral life, it is necessary to know what the virtue is. Having determined four main virtues, Socrates states that prudence can be considered as the major one which is the source for developing justice, temperance, and fortitude. His arguments depend on his opinion that prudence (or wisdom) is associated with the human intelligence or reason, and intelligence is the knowledge (Taylor, 2001). Thus, Socrates understands virtue and the way to it as the knowledge.Advertising Looking for essay on philosophy? Let's see if we can help you! Get your first paper with 15% OFF Learn More According to Socrates, the real morality and virtue is the knowledge of what is good and what is bad (Taylor, 2001). The understanding of virtue as good is the way to reach the person’s moral satisfaction and live the happy life. A man can acquire such virtues as prudence, justice, temperance, and fortitude when he spends a lot of time trying to learn and perceive the world around him and developing oneself. The human’s perception is his knowledge about oneself and the reality. It is possible to learn to live a virtuous life as persons learn any other norms and rules. Socrates considers virtues and the moral norms and rules which are based on them as eternal and unalterable. Analyzing Socrates visions of virtue, it is possible to say that he understands the knowledge as the source for developing virtues the main of which is prudence as the reflection of person’s intelligence (Taylor, 2001). Aristotle develops Socrates’ principles associated with the notion of virtue and presents his own structure of human’s moral categories which form the ethics. Thus, Aristotle understands virtue is the balance or ‘golden mean’ between two possible extremes in actions and thoughts (Curzer, 2012). That person who is virtuous should know where this ‘golden mean’ is and act according to it in order to achieve the goal to live the happy life. Happiness is the notion which Aristotle combines with the idea of virtues because virtue is the human’s way to his happiness and the part of happiness as the whole one. Happiness as a result of following a virtuous life is also the part of the person’s life when his mind controls his will, feelings, and emotions and points the good way to happiness (Curzer, 2012). Moreover, Aristotle determines much more virtues which influence the people’s life. They are liberality, truthfulness, friendliness, forgiveness, integrity and some others which form the person’s morality (Gottlieb, 2011). According to Aristotle all the virtues can be divided into intellectual and moral. Thus, intellectual virtues are affected by the people’s wisdom and their will to follow them. Moral virtues are connected with the emotional nature of humans (Gottlieb, 2011). They depend on the people’s desire, will, and motives to realize them. Virtue is the moral category which can be considered as the motivation for person’s actions and behavi or. Therefore, Aristotle understands person’s will, desire, and motivation as the main basis for virtue, but not the knowledge (Curzer, 2012).Advertising We will write a custom essay sample on The Main Difference between Aristotle’s and Socrates’ Account of Virtue specifically for you for only $16.05 $11/page Learn More Socrates and Aristotle develop the knowledge of virtue as goodness and the combination of the person’s best traits, but their approaches to the issue of the source of virtues are quite opposite to each other and form the main difference in their visions of virtue as the moral category. Socrates’ opinion that the knowledge is the single source of virtue is argued by his successors. The idea that â€Å"virtue is knowledge of what the agent’s good is, and the agent’s good is knowledge† is rather controversial because it appeals only to the rational on in humans and rejects the fact of their emotional causes for actions (Taylor, 2001, p. 69). Socrates does not differentiate between the knowledge and its usage. He considers that a person can act badly and without following the principles of virtuous life only because of the fact he does not know these principles. This opinion can be considered as rather idealistic because it rejects the natural peculiarities of the people’s behavior which are based on the affective part of the personality (Taylor, 2001). Aristotle’s vision of the virtue’s source can be considered as more realistic in comparison with Socrates’ one. He is the first philosopher who develops the moral principles with focusing on the voluntary aspect of personality. The knowledge has the general character, and the action is a result of the personal will. Being influenced by the knowledge, virtues and morality depend on will and desire to live a virtuous life. It is possible to know what is good, but it is important to want to follow goodness (Gottlieb, 2011). It is important to notice that that person who has the knowledge about virtues can have no desire to develop them and to follow them even if she knows these moral principles. That is why Aristotle’s theory of virtue is â€Å"relevant to contemporary life in detail, not just in general approach† (Curzer, 2012, p. 4). Aristotle’s viewpoint that virtues in action are the effects of person’s will can be considered as more plausible in comparison with Socrates’ idea on the rational character of virtues. The notion of virtue is the basic category of the ethics which was developed by Socrates and Aristotle. The main principles of virtues provided by these philosophers have many similarities in relation to virtue as the moral category, but the main difference is in Socrates and Aristotle’s vision of the source of virtue.Advertising Looking for essay on philosophy? Let's see if we can help you! Get your first paper with 15% OFF Learn More Socrates presents the idealistic visions of goodness depending only on the knowledge when Aristotle examines all the aspects of this notion and focuses on the voluntary factor. Aristotle’s idea can be considered as more reliable because it depends on the natural characteristics of personality. References Curzer, H. J. (2012). Aristotle and the virtues. USA: Oxford University Press. Gottlieb, P. (2011). The virtue of Aristotle’s ethics. USA: Cambridge University Press. Taylor, C. C. W. (2001). Socrates: A very short introduction. USA: Oxford University Press. This essay on The Main Difference between Aristotle’s and Socrates’ Account of Virtue was written and submitted by user Valeria Randolph to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Ways to Serve Others This Christmas

Ways to Serve Others This Christmas Christmas is the season of giving; since our schedules offer so much flexibility, homeschooling families often have the availability to give back to their community during the holiday season. If you and your family have been considering service opportunities, try any of these 11 ways to serve others this Christmas. Serve Meals at a Soup Kitchen Call your local soup kitchen or homeless shelter to schedule a time to go serve meals. You might also inquire if they are low on any specific supply needs. This time of year many organizations host food drives, so their pantry may be full, but there may be other items that need to be restocked such as bandages, blankets, or personal hygiene items. Sing Carols at a Nursing Home Gather your family and a few friends to go sing Christmas carols at a nursing home. Ask if it’s okay to bring baked goods or wrapped candy to share with the residents. Spend some time before you go making homemade Christmas homemade cards to deliver or buy a box of assorted cards to share. Sometimes nursing homes are overwhelmed with groups that want to visit during the holiday season, so you may want to see if there are other ways that you can help or better times to visit. Adopt Someone Choose a child, grandparent, single mom, or family who is struggling this year and purchase gifts or groceries or deliver a meal. If you don’t know someone personally, you can ask local agencies and organizations that work with needy families. Pay Someone’s Utility Bill Inquire at the utility company to see if you can pay the electric, gas, or water bill for someone who is struggling. Due to privacy factors, you may not be able to pay a specific bill, but there is often a fund to which you can donate. You might also check with the Department of Family and Children’s Services. Bake a Meal or Treats for Someone Leave a little snack bag in the mailbox with a note for your mail carrier, or put a basket of snacks, soft drinks, and bottled water on the porch with a note inviting delivery people to help themselves. That’s sure to be a greatly appreciated gesture during the busy holiday season You can also call your local hospital and see if you could deliver a meal or snacks and drinks to the ICU waiting room or hospitality room for the families of patients. Leave a Generous Tip for Your Server at Restaurants We sometimes hear of people leaving a tip of $100 or even $1000 or more. That’s fantastic if you can afford to do that, but just tipping above the traditional 15-20% can be greatly appreciated during the holiday season.   Donate to the Bell Ringers The men and women ringing bells in front of stores are often recipients of the services offered by the organization for whom they’re collecting. The donations are typically used to operate homeless shelters and after-school and substance abuse programs and to provide meals and toys to needy families at Christmas. Help the Homeless Consider making bags to give out to homeless people. Fill a gallon-size storage bag with items such as gloves, a beanie, small juice boxes or water bottles, non-perishable ready-to-eat food items, lip balm, facial tissues, restaurant gifts cards, or prepaid phone cards. You might also consider giving blankets or a sleeping bag. Perhaps an even better way to help the homeless community is to  contact an organization that works directly with the homeless  and find out what they need. Often, these organizations can stretch monetary donations farther by purchasing in bulk or working with complementary organizations. Do Housework or Yard Work for Someone Rake leaves, shovel snow, clean house, or do laundry for someone who could use the extra help. You might consider a sick or elderly neighbor or a new or single parent. Obviously, you’ll have to make arrangements to do housework, but yard work can be done as a complete surprise. Take a Hot Beverage to People Working in the Cold Police officers directing traffic, mail carriers, bell ringers, or anyone else working out in the cold this Christmas season will appreciate a cup of hot cocoa, coffee, tea, or cider. Even if they don’t drink it, they’ll enjoy using it as a hand warmer for a little while.   Pay for Someone’s Meal at a Restaurant Paying for someone’s meal in a restaurant or the car behind you in the drive-thru is a fun random act of kindness any of time of year, but it’s often especially appreciated at Christmas when money is  tight for  many families.   Whether youre investing your time, your financial resources, or both to serve others this holiday season, youll likely find that its you and your family who are blessed by serving others.

Social Contract Theory Research Paper Example | Topics and Well Written Essays - 1500 words

Social Contract Theory - Research Paper Example The social contract theory examines the notion of political legitimacy, which states that human beings have no ultimate right to exercise power over each other until the parties involved have mutual consent in an agreement (Rawls 223). According to the social contract theory, a natural basis for morality can be provided by the need for social order. The interaction between people forms the basis for certain incentives within the social system, which determine the peaceful coexistence between people in society. Social contract theory calls for the formation of certain agreements and follows some fundamental rules while at the same time treating each other with a lot of respect. Based on the social contract theory, humans find it beneficial to enter into some form of social contracts that will guide their moral judgments. Without such a contract, people would not exist peacefully as their interaction with one another would be disorderly (Rawls 225). The social contract theory also holds the view that the political, social, and moral obligations of a person largely borrow from the agreements they have made in their society. The modern political and moral theory is related to the social contract theory. In a nutshell, the social contract theory mainly focuses on the consensus that should emanate from explicit consent between several players in an agreement. The consent should be between people who reason properly and no one should be coerced to enter into an agreement. Social contract theorists, such as Jean-Jacques Rousseau, strived to explain consensus with his explanation of the â€Å"general will.† For Rousseau, the social contract theory involves entering into a contract based on the collective interest of the entire group rather than focusing on the interests of a few individuals. The will of an individual should be appropriated with the interests of the entire group so as to

Managed Care and Psychotherapy Essay Example | Topics and Well Written Essays - 2250 words

Managed Care and Psychotherapy - Essay Example It rapidly spread to health insurance industry in private sector. It relies upon and effort to control ever increasing health care costs by health insurance industry, which fixes a reasonable fee. Health care provides charge for their services. Thanks to managed care facilities provided by health insurance industry, medical inflation rate decreased drastically in 1990's in U.S. But right now the effect looks like it has ended abruptly and U.S. medical inflation is beginning to rise steeply. Psychotherapy in its traditional form is being challenged due to managed care pressures. Managed care is not needful for psychiatric patients as it creates many hindrances to the consumer in the early steps of treatment. Managed care makes the psychotherapy sessions completely transparent, when it is supposed to be undisclosed. There are pros and cons. Managed care in psychotherapy is significantly a bane to the consumers. Psychotherapy always requires long number of sessions but due to pressure from insurance companies, psychotherapists reduce the number of sessions. It is the indirect supervision of the financial management of a consumer's medical care performed by the ultimate reimbursement entity, commonly known as the payer.' Payers use utilization review'-a medical professional oversees the treating physician's decisions to determine if the most financially efficient method is being used. In the optimistic view, managed care offers coordinated, integrated systems of care that emphasize prevention and cost restraints. But actually managed care leads to limited access, lack of choice and, sometimes, limitation of care. O'Hara, M. (1997) reports: Nowhere are the concrete consequences of the rising levels of cultural incoherence more visible than within the community of psychotherapists. Therapeutic psychology and its spin-offs, clinical social work, marriage and family therapy, psychiatric nursing, and organizational behavior, are disintegrating as academic disciplines and as fields of professional practice. The field of psychology and the individuals who inhabit it are in the midst of theoretical, epistemological, methodological, and ethical meltdown. Pluralism in graduate school training, discussions about licensing and credentialing, variations in clinical theory and practice, debates about the status of psychological knowledge as science and as evidence in courts of law, shifting definitions of ethical and unethical behavior, and proliferation of antitherapist consumer protection laws are just some of the ways the postmodern crisis is already affecting the field. And it will get worse. Psychotherapists get into prescription business and provide pills. They are likely to have very less interaction with consumer and hinder the normal process of psychotherapy. Managed care minimizes the professional secrecy. As primary care physician refers the consumer to a specialist psychotherapist. Managed care programs that are commonly used are, as listed by Kuhl, V. (1994): Health Maintenance organization (HMO): In this a federally qualified HMO in exchange for a subscriber fee (Premium) allows members to access to a panel of employed physicians and facilities, including hospitals. In return HMO receives mandated market access and receives federal development funds. In HMO plan, a member is assigned a "Gatekeeper", a primary care physician (PCP) who takes care of members assigned to him. To avail specialty services like a specialist

Conflict between the debt holders and shareholders

Conflict between the debt holders and shareholders Myers and Majluf (1984) in their pioneering work on pecking-order theory show that if the investors are not well informed about the information which the insiders have, the equity of that firm may be severely mispriced. In their paper they also show that if any firm wants to fund its new project by new equity then the equity can be so undervalued that the new investors will be better off by getting more value than the projects NPV. So the organization will go for such a source which is not underpriced by the market like internal funds or riskless debt. So, in case of information asymmetry companies should follow an order of financing. Myers (1984) refers to this order as the pecking order. As per the pecking order the firm first goes for internal funds and then for low risk debt and finally equity. As we have three major capital structure theories in the literature, it becomes an interesting task to test which theory characterises the behaviour of Indian firms in their determining th e capital structure during the bullish phase of capital market. There are many empirical studies [Bradley, Jarrell, and Kim (1984), Titman and Wessels (1988), Rajan and Zingales (1995), Wald (1999) and Booth et al. (2001)] which have been done to test the applicability of the above mentioned capital structure theories in the developed and developing countries. Market Timing Theory Market timing, a comparatively old initiative (see Myers, 1984), is having a new surge of fame in the academic literature. In study by Graham and Harvey (2001), managers carry on to offer support for the plan. Consistent with the behavior of market timing, firms inclined to issue equity subsequent a stock price run-up. Furthermore, researches that analyze long-run stock profits following business financing events find proof reliable with market timing. Lucas and McDonald (1990) investigate a dynamic adverse selection model that mix essentials of the pecking order with the market timing theory, which can give details of pre-issue run-ups but not post issue Under performance. Baker and Wurgler (2002) said that capital structure is best perceived as the cumulative effect of precedent attempts to time the market. The basic suggestion is that managers look at existing circumstances in both debt market and equity markets. If they found a need of financing, they use whichever market present ly looks more favorable. If neither market looks positive, they may go for defer issuances. On the other hand, if present conditions look strangely favorable, funds possibly will be raised still if the firm has no need for any funds at this time. While this idea seems reasonable, it has not anything to say about most of the factors conventionally considered in studies of corporate financing. However, it does propose that stock returns and debt market circumstances will play an significant role in capital structure decisions. LITERATURE REVIEW The first paper on capital structure was written by Miller and Modigliani in 1958, Showing that subject to some restrictive situation, the impact of leveraging on the worth of firm is immaterial; the conceptually provided that the worth of firm is not dependent upon the capital structure decision given that certain conditions are met. Because of the unrealistic assumptions in MM irrelevance theory, research on capital structure gave birth to other theories. According to the traditional (or static) trade-of theory (TOT), firms select optimal capital structure by comparing the tax benefits of the debt, the costs of bankruptcy and the costs of agency of debt and equity, that is to say the corrective role of debt and the fact that debt effects from informational cost than outside equity. (Modigliani and Miller, 1963; Stiglitz, 1972; Jensen and Meckling, 1976; Myers, 1977; Titman, 1984.) The Trade Off theory says that a firms adjustment toward an optimal leverage is influenced by three factors namely taxes, xosts of financial distress and agency costs. Baxter (1967) argued that the extensive use of debt increases the chances of bankruptcy because of which creditors demand extra risk premium. He said that firms should not use debt beyond the point where the cost of debt becomes larger than the tax advantage. In the so-called Pecking Order Theory (POT) (Donaldson, 1961; Myers and Majluf, 1984; Myers, 1984), because of asymmetries of information between insiders and outsiders, the company will prefer to be financed first by internal resources, then by debt and finally by stockholders equity. The debt ratio depends then on the degree of information asymmetry, on the capacity of self-financing and on the various constraints which the company meets in the access to the various sources of financing. So, in the pecking order world, observed leverage reflects the past profitability and investment opportunities of the companies. The dynamic trade-off theory (DTOT) tries a compromise between TOT and POT (Fischer et al., 1989; Leland, 1994, 1998[1]). Although, due to information asymmetries, market imperfections and transaction costs, many companies allow their leverage ratios to drift away from their targets for a time, when the distance becomes large enough managers take steps to move their companies back toward the targets. While the POT explains short-run deviation from the target, the traditional TOT holds in the long run. Following this approach, leverage must converge toward a target leverage ratio. That would no be the case following POT because managers make no effort to turn around changes in leverage. Two additional theories also reject the idea of timely meeting toward a target leverage ratio. According to the theories of market timing and inertia, the capital structure is the result at a given time of an historical process. Supporters of the market timing approach (Jalilvand and Harris, 1984; Korajczyk et al., 1991; Lucas and McDonald, 1990; Jung et al., 1996; Loughran et al., 1994; Baker and Wurgler, 2002) argue that companies will sell overpriced equity shares. Companys share prices will fluctuate around their factual value, and managers inclined to issue shares when the market-to-book ratio is high. A small debt ratio must thus follow a long period of high market-to-book ratio. According to the managerial inertia approach (Welch, 2004) companies do not adjust their debt ratio to the fluctuations of the market value of their equity. High market-to-book ratio must thus be accompanied by small debt. Graham and Harvey (2001) find that chief financial officers in the USA express concern about earnings volatility in capital structure choices. According to Mohammad M. Omran and John Pointon (2009) study, one of our issues of interest is whether debt is negatively associated with earnings volatility, in which case firms react to the risk, and manage it by reducing debt. On the other hand, if debt is found to be positively associated with earnings volatility, then they do not appear to manage the risk. Ayesha Mazhar and Mohamed Nisar (1997) have discussed the determinants of capital structure of Pakistani firms. They selected a sample from Pakistani companies registered on Islamabad Stock Exchange. The sample is divided into two sub-samples of private and government owned companies to make comparison between both sectors. The sample comprised 91 Pakistani companies out of which 80 companies are private and 11 are government owned covering the period of 1999-2006. They have taken debt to equity as a proxy of leverage of a firm, and tangibility of assets, profitability, size, growth, tax provision and return on assets as independent variables. They use correlation to determine the degree of association between different variables. Spearmen correlation is used for all independent variables association with dependent variables. Regression is also used to measure the relationship between dependent and independent variables. Attaullah shah and saifullah khan (2007) they used two variants of penal data i.e. constant coefficient model and fixed effect model to calculate the determinants of capital structure of Karachi Stock Exchange listed non-financial firms from1994 to2002. Pooled regression investigation was applied with the hypothesis that there were no industry or time effects. Though, by means of fixed effect dummy variable regression, the coefficients for a amount of industries were significant displaying there were significant industry effects later we accepted the late model for our investigation. He had measured effect of seven explanatory variables is measured on leverage ratio which is designed by dividing the total debt by total assets. Safdar Ali Butt and ArshadHasan(2009) had explores the association between capital structure and corporate governance of stock exchange listed companies in an equity market. The study considered the period of 2002 to 2005 for which 58 randomly selected non-financial listed companies from Karachi Stock Exchange has been investigated by using multivariate regression line analysis with fixed effect model method. Managerial ownership has negative relationship with debt to equity ratio indicating that concentration of ownership induces the managers to lower the gearing levels. Institutional ownership has positive relationship with capital structure which is consistent with corporate governance philosophy but this relation is statistically insignificant. Traditional determinants of capital structure like size and profitability have significantly effect on corporate financing decisions. Profitability is negatively related with debt to equity ratio and it is consistent with pecking order hyp othesis. Similarly, size has positive relationship which shows that large firms can arrange debt financing due to long term Relationship and better collateral offering. NengjiuJu, Robert Parrino, Allen M. Poteshman, and Michael S. Weisbach Abstract (2005) this paper inspect optimal capital structure choice by means of a dynamic capital structure model that is standardized to reflect genuine firm features. They also examine the relation between firm value and capital structure. They estimate indicate that the impact on firm value of moderate deviations from optimal capital structure is small. This paper suggests that the trade-off model performs reasonably well in predicting capital structures for firms with typical levels of debt. This paper also shows that the major forces affecting a firms financing decisions are corporate taxes and bankruptcy costs. Mohamad H. Mohamad, Professor of Business Administration. School of Management, University Utara Malaysia (Northern University of Malaysia), Sintok, Kedah DarulAman, Malaysia (1995).they examine the determinants of firms capital structure in Malaysia covering the period between 1986 to 1990. There are significant inter-industry differences in capital structure among Malaysian companies. Highly-leveraged firms are more likely to earn higher profits than less-leveraged firms. Similarly the relation between firms profit and equity ratio is also positive and is reflected in terms of the importance of efficient capital markets. Laurence Booth, VaroujAivazian, AsliDemirguc-Kunt, Vojislav Maksimovic(1999) has analyzed capital structure of firms in ten developing countries and provide indication that these choices are affected by the same variables as in advanced countries. But, there are constantly repeated differences across countries, when corporations choose to use of debt financing; they are altering some predictable future cash flows away from equity pretenders in exchange for cash up front. The issues that drive this decision remain mysterious regardless of a vast theoretical literature and years of experimental tests. The quantity of proof is large, and so it is frequently all too relaxed to provide some pragmatic support for nearly any idea. It is satisfactory for a given paper but more challenging for the general expansion of our thoughtful of capital structure choice. As an outcome, in current decades the literature has not had a concrete experimental basis to differentiate the weaknesses and streng ths of the main theories. Numerous theories of capital structure have been proposed which theory shall we take seriously? Of course, opinions differ. Remarkably, nearly all corporate finance textbooks inclined to the trade-off theory in which bankruptcy costs and deadweight taxation are key operators. Myers (1984) projected the pecking order theory in which there is a financing hierarchy of retained earnings, debt, and then equity. In recent times, the idea that firms are engage in market timing has gain popularity. In conclusion, agency theory lurks in the background of a lot theoretical conversation. Agency concerns are frequently collected into the trade-off structure largely interpreted. Advocates of these types of models are frequently point to experimental proof to support their preferred theory. Often suggestion has been made to the survey by Harris and Raviv (1991) or to the experimental study by Titman and Wessels (1988). Both these two standard papers point up a serious empirical difficulty. They are disagreed over basic facts. According to Harris and Raviv (1991, p. 334), the accessible studies normally agree that leverage increases with tangible fixed assets, growth opportunities, non debt tax shields, firm size and decreases with advertising expenditures, volatility, research and development expenditures, profitability, bankruptcy probability, and uniqueness of the product. On the other hand, Titman and Wessels(1988, p. 17) find that their outcome do not provide sustain for an effect on debt ratios due to non debt tax shields, collateral value, volatility, or future growth. Therefore, advocates of exacting theories are presented a choice of absolutely opposing well-known summaries of what we all know from the preceding literature. Obviously this is unacceptable, and th e study aims to assist resolve this experimental difficulty.

Freedom of Contract in English Law

In earlier days, agreement was built on a very classic and simple basis: it is concluded at the moment that the acceptance of an offer takes place and that is all. In consequence, equal parties were non-existent and stronger parties had the possibility to impose unfair and domineering conditions upon those who were weak and vulnerable. It is in this context that both legislations and courts agreed that State action was indispensable to ensure fairness among individual parties, in an era where the exercise of law of freedom were extremely restricted.In today’s English law, freedom of contract is one the foundation of contract law. The existence of freedom of contract requires three main considerations: the freedom to contract or not to contract, the freedom to choose with whom to contract, and the freedom to decide the terms of the contract. Thus parties are totally free to engage or not to engage in agreements. However, freedom of contract can fail to have the desired or expec ted effect in contracts where power relations are not equal. The stronger party can impose its â€Å"will† to the weaker party.In order to deal with any potential conflict that can arise from this matter, English legal systems has set up rules ensuring the effective and fair exercise of freedom of contract. This essay will discuss and examine those rules in question, established by the English law in order to effectively balance freedom of contract and fairness between the contracting parties as well as fair contractual terms. And also on the other hand limits of freedom of contract will be exposed. Freedom of contract, as its appellation suggests, has a strong relationship with contract.In order to identify this relationship, it is important to understand what is meant by â€Å"contract† and the rules governing it. In English law, a contract is a legally binding agreement reached on a set of promises (or obligations) and specific terms. The validity of any contract re quires 4 main features: an offer, acceptance, consideration and intention to create legal relations. Thus, when one party (the offeror) makes an offer which the other (offeree) accepts, then agreement is concluded.However, the mere fact of an agreement is insufficient for a contract to be completely valid. This implies that a party must promise to give or do something for the other. This idea of exchanging promises is known as â€Å"consideration† and is an essential requisite of any valid contract. In Currie v Misa(1875) it (consideration) was held to constitute a benefit to one party or a detriment to the other. For instance, when a bottle of wine is bought from a shop, the benefit received is the bottle of wine, and the detriment is the money paid to the shop.Yet it is important to take into concern the rules governing consideration. First of all, consideration must not be in the past(as mentioned in the a. This rule suggests that if one party willingly performs an act, an d the other party then makes a promise the consideration said to be in the past. Therefore past consideration is regarded as no consideration at all. For instance, a pregnant woman named Julie, knowing that her neighbour, Lucy, is concerned about her health, offers to do the housework for her.This takes Lucy tremendous amount of time to do, and Julie is so content with the result that she promises to pay Lucy ? 30 for her effort. If Julie fails to pay, Lucy will not have the possibility to sue for breach of contract as Julie's promise to pay was after the completion of the work. The fact of this case is supported by the case of Re McArdle(1951,CA) in which it was held that no valid contract existed since the home improvements were past consideration; they had been carried out before any promise to pay had been made.Another rule is that consideration must move from the promisee which is very similar to the concept of law of privity. So for instance if A makes a promises to B, the pro mise will only be enforceable if B can equally show that he has provided consideration for A’s promise. This rule clearly demonstrates the fairness (among parties) of the doctrine of consideration. Finally, consideration must be sufficient but need not to be adequate. This rule stipulates that a good consideration must be of some value but there is not necessity for a bargain to be of adequate value.For example, if someone is willing to sell his Ferrari for ? 1, the contract will not be in vain due to lack of consideration and therefore will be sufficient. In this case, Courts will not measure the adequacy of the consideration (the fact that a Ferrari is offered to be sold at only ? 1) as it is up to one party to decide whether or not he agrees with the other party promises. The contract in English law enhances principle of freedom of contract.Indeed, the terms of the contract is freely determined and agreed by the parties. However, there are various circumstances in which ad ditional terms may be implied into the agreement. The aim of implied terms is often to provide a supplement to a contractual agreement in the interest of making bargain more effective, to achieve fairness between the parties and to alleviate hardship. Term may be implied by custom. Here it is suggested that a contract must always be examined in the light of its surrounding commercial context.So the parties automatically assume that sometimes their contract will be subject to the customs of a particular locality or trade and therefore do not deal specifically with the matter in their contract. One of the cases illustrating this is Hutton v Warren(1836). A term may equally be implied into a contract y Act of Parliament in the form of statutes. Under the Sale of Goods Act 1979, ss 12-15 for instance, a seller automatically assumes certain obligations to the buyer as a result of terms which are automatically implied in every contract regulated by the Act.The seller is required by statut e to promise that he has lawful authority to transfer ownership of the goods(s12)(the seller would for example break this term if it turns out that the goods were stolen);that the goods being sold will match the description he provided the buyer(s13)(for instance a shirt described as 100 per cent cotton should not contain man-made fibres); that the quality of the goods being sold will satisfy the buyer(s14(2)); that the good will be suitable for any purpose specified by the buyer(s 14(3)); and that the goods being sold will match any sample shown to the buyer prior to the contract being made(s 15).Breach of any of these terms will put the buyer in a strong position and be given the option to be discharged from the contract or alternatively carry on with the contract and claim damages for the breach. This will lead us to the concept of remedies mentioned in the following part. In English contract law, a crucial aspect of the contractual relationship is the enforcement of the contract , as the obligation that pact must be kept firmly by parties is considered as the backbone of any contractual relationship.However, a problem can occur if a contract is not adequately performed and one of the parties renounces to perform its obligations. This is where the concept of non-performance and the remedies available to the injured party become applicable. Breach of contract arises from the non-respect of the pact (or terms) agreed between parties. The aggrieved party is then given the common law right to claim for a remedy resulting from any quantifiable loss or harm suffered. Damage (financial compensation) is the most basic remedy available to the innocent party.In today business environment, it is not rare for the parties to agree in advance the damages that will be payable in the occurrence of a breach of contract. These damages are referred to as liquidated damages. An illustration of liquidated damages is the charges imposed for cancelling a flight or the booking of a hotel room. But sometimes, there is a temptation for a party with stronger trading power to try imposing a penalty clause (punitive payment for the non-performance of a term or condition) as demonstrated in Wilson v. Love (1896) case.Other remedies such as quantum damages and injunction may be granted at the discretion of the court as part of its equitable jurisdiction. So, as mentioned above, remedies is all about compensating the aggrieved party for causing him loss or harm. This can be avoided by the consideration of the prevailing rules of freedom of contract. In other words, Freedom of contract allowing individual parties to freely contract or not to, and no one being forced to do it , whoever therefore who gives a contractual promise must then keep it.Or on the contrary case, as described in earlier parts can be constrained by legal authorities to honour its commitment or compensate the other party. However, performance of a contract becomes sometimes impossible due to the ci rcumstances beyond the control of either of the parties and not due to their fault. The legal term referring to this situation is frustration. An example of this unforeseen event is illustrated in the case of Taylor v Caldwell (1863) in which it was held that contract was impossible to perform due to an external and unforeseen event.Consequences are that the contract is killed and parties discharged from further liability. This limits the exercise of freedom of contract in a sense that the agreement formed by the parties is nullified, regardless individual parties will. Another limitation of freedom of contract is that the choice of other contracting party is not always free. For example, an employer is not totally free to hire the person of his choice. The fact that insurance contracts are sometimes made obligatory by parties equally render the exercise of freedom of contract limited, as concerned parties did not freely choose to contract with an insurance company.So far, this pap er has been about the relationship between the exercise of freedom of contract and law of contract. However not only is freedom of contract concerned with contract law but also with another component of the English private law, which is tort law. A tort is a civil wrong. In other words, it refers to the liability of a person who causes harm to another with the obligation to repair the damages suffered by the victim. An example of tort is damage to commercial interests, e. g. inducement of breach of contract.Also known as tortious interference, inducement of breach of contract arise where the wrongdoer convinces a party to breach the contract against the claimant, or where the wrongdoer prevents one party from performing his obligations(agreed with the other party), thus stopping the claimant from receiving the performance promised. Furthermore, after mentioning the existence of a duty of care, which is an element required making negligence claim (concerned with a wrongdoer’s careless conduct which cause damage or loss to the defendant), the claimant (the injured party) can prove that this duty has been broken by the defendant (the other party).Hence the close relationship between duty of care and the requisites of freedom of contract in the sense that if parties freely agree to contract (including the terms of it), then, it is suggested, that they owe a duty of care to each other because the careless conduct (which can affect the contract) of one party can prevent the other one from receiving the performance promised, regardless to the external factor that caused the misconduct of the blamed party. This fact is supported by the case of Garret v.Taylor (1620) in which the court upheld a judgment for the claimant. To conclude, the purpose of this essay has been to describe and make a connection between law of contract as well as law of torts and freedom of contract. Thus, English legal systems have established multiple rules of conduct from different part ies to a contract in order to ensure fairness between them. Henceforth, contracting parties are given freedom to contract with whoever they want, including the terms of the contracts.Also, thanks to rules such as of duty of care, or of doctrine of remedies, an injured party is now given the possibility to claim for compensation of loss or harm caused by the blamed party, who will be then obliged by legal authorities to repair the damages caused to the aggrieved party due to non-respect of the rules established. In the end, it must be acknowledge that English Law has stroke an appropriate balance between freedom of contract and fairness. References:Currie v Misa (1875) LR 10 Ex 153; (1875-76) LR 1 App Cas 554:Definition of consideration Garret v. Taylor, 79 Eng. Rep. 485 (K. B. 1620): Tortious interference Hutton v Warren (1836) 1 M;W 460:Implied terms Re McArdle(1951,CA ):Past consideration being unacceptable Sale of Goods Act 1979, ss 12-15 : Statutory implied terms Taylor v Caldwe ll (1863) 3 B ; S 826; 122 ER 309; [1863] EWHC QB J1: impossibility of performance of contract Wilson v. Love (1896) : Liquidated damages