Monday, September 30, 2019

Young People Have More Want Than Needs. What Are Your View?

Young People Have More Wants than Needs. What do you think? This materialistic world produces enormous amount of goods and services to satiate our wants more than our needs. The attitude of satisfying one’s wants has almost always preceded one’s needs. This new wave of attitude is especially obvious in young people who have endless desires to have what they want instead of what they actually need. Consequently, nowadays, we have often heard the phrase â€Å"I want† and rarely get to hear â€Å"I need† from young people.This is especially evident in the things young people are seeking today. No doubt, good education is part of it and it is indeed necessary. However, some have become so obsessed with achieving better grades that they are willing to spend a fortune on getting additional help beyond their school for the sake of beating their classmates in academic results. Wanting to achieve their objectives, some have hired a few personal tutors to help them out. Instead of relying and making good use of what is already provided to them, such ones have taken things for granted.They do not see that their needs have actually been fulfilled but focus too much on their wants, which is getting better results to perhaps outshine their peers. Regrettably, this kind of obsession would mean that their parents’ hard-earned money is spent wastefully or even unwisely. For what, for satisfying their wants when their needs have actually been met. Additionally, the pursuit of keeping up to date with fashion is all too common in young people.These things are not bad in themselves but to maintain one’s closet with the latest fashion means that young ones may often spend beyond their means simply for the purpose of satisfying their wants. Even for those without the means to possess the latest, they may even try to get what they want through illegal channel such as doing part time as escorts. Sadly, this has been happening in recent years. A pparently, the trend has taken root because young people often fail to differentiate clearly their wants from their needs.Not to be overlooked is the desire to pace up with the epoch of technology in terms of mobile phones. Gone are the days of owning a phone just to make calls and sending short text messages. Our generation has become extremely sophisticated with the advancement in technology. Unfortunately, we have been witnessing the massive production of smart phones that keeps flooding the market with infinite choices and temptations to have to own one. Ironically, we are seeing young people wning the latest smart phones more than adults who are supposed to be the more likely group of people to own these things. So the question is how on earth do our young people get the financial means to purchase these gadgets? Apparently, their main sponsors are their parents. As a matter of fact, quite a large number of young people are often seen pestering their parents to buy them or equi p them with the latest products. This has also evidenced itself when parents are being demanded to trade good examination results in return for getting what their children want.To make matters worse, young people sometimes threaten their parents, who may not be wealthy enough, to buy the latest smart phones for them. To sum it all up, I must say that young people have more wants than needs. If only they could exercise a little more of their thinking ability, they would definitely be able to discern for themselves that wants will always be endless but needs are very few and necessary but the latter must precede the former.

Sunday, September 29, 2019

Amy’s Bread Essay

Strengths: Amy’s entrepreneurial spirit; Toy Kim Dupree-excellent right-hand manager; Already has about 50 wholesale customers, plus 30 on a waiting list; Company is finally turning a profit; Positive work environment (5 day work week, better pay than competition, benefits package, 401(k) plan, employees allowed to speak freely, low turnover); Retail business allows for higher profit margins, and now represents 25% of Amy’s business; Good niche product mix-high quality bread products, micro-bakeries; Makes herself available to the press/public, leads to word of mouth advertising; Can now secure bank financing due to Amy’s proven track record; Wholesale business (representing 75% of the business) is more stable than retail business. Opportunities: Much higher profit margins in high-end breads (black olive, apple walnut rasin-$2.40 wholesale, $3.40 retail profit with the high-end breads vs. $1.71 wholesale, $2.60 retail without high-end breads); Retail business (currently 25% of business) allows for higher profit margins and payment is only in cash; Hiring another manager could allow Amy more time to run the company; Buying 31st street location would allow for production facility expansion and the ability to cater to customers currently on the waiting list; Leasing the 15th street location could allow both retail and production expansion. Weaknesses: Bakery industry is highly competitive with low wholesale profit margins; NYC locations are very expensive; Higher labor costs due to hand-production techniques (35% of CGS); Ingredient prices are volatile; Ingredients are more expensive than the competition’s; CGS is 65% of net sales; Competitors can enjoy better economies of scale due to automated production and cheaper ingredients; 75% of the business is through lower-profit wholesalers; Current production location is too small to meet growing demand. Threats: Dieting trends (i.e. Atkins diet) could affect consumer demand for bread. Mission: To produce high-quality, handmade breads for wholesale and retail customers through our retail locations and door-to-door deliveries. Objective: Amy’s Bread has seen steady growth over the last few years. This success has overextended both the employees and the warehouse space. Amy is looking to move operations to one of two locations: a building on 31st street, or one on 15th street. The 31st street location would allow Amy to expand her wholesale business and allow her to invest in a property instead of leasing. Amy should also look into adding a manager to allow her the time to focus on the overall business. Her most profitable bread lines are the high-priced breads, she should look into increasing the number of high-priced bread. Eventually, Amy should consider opening small retail locations in New York City.

Saturday, September 28, 2019

Decisions Essay Example | Topics and Well Written Essays - 1500 words

Decisions - Essay Example This also takes into consideration the fact that decision-making is impossible to be the same in every organisation of a country, in spite of similar culture. But on the whole, it would be more or less identical and definitely, it would be totally different from organisations of another culture. Various cultures have different ways of approaching a problem and solving it. It could a participatory method or the time-honoured authoritative approach, or the decision-making might involve a group, or the topmost manager could take the total responsibility of it on his shoulders. Country related cultural factors like high or low masculinity, weak and strong uncertainty avoidance, and different ways of assessing the problem can all affect the process of decision making. Even if the outcome could be poles apart, the steps of decision making are more or less the same: identifying the problem, criteria, and allocation of weights to criteria and the final decision. If problems are framed to two people, it would definitely result in at least slightly different solutions and it is not surprising that two countries with diverse backgrounds, race and culture should have organisations that would take unidentical decisions in solving a management problem3. Defining the problem itself could be from absolutely dissimilar angles. From the decision-making point of view, a wrong diagnosis of the problem could definitely lead into wrong decision-making. Sometimes managers act without complete knowledge of the problem in haste4. Identifying the relevant criteria is the next step of decision-making. Judging the weight of the criteria, so that the decision could be taken accordingly is another step. Before making a decision, it is absolutely necessary to look at the alternatives and apply them to the criteria and assess and decide on the best-suited alternative under the circumstances. If alternatives are not considered, there is always a mischance of leavin g aside a better option. Rating each alternative against each criterion is the best way of taking a decision. Only after that, a decision could be arrived at and before the final decision, its credibility, far reaching affect and its suitability should be assessed. US AND JAPAN These two countries are absolutely different from one another in race, culture and outlook. Japanese had enormous success in industrial and technological field and since then they are pitted against United States in decision making. There is a crucial point that US has a top-down decision making process, where decisions come down from the top level and the rest are expected to follow it verbatim. But Japanese still believe in conventional society, and here the decisions are made at the operating level, 'a sort of bottom-up process' and such decisions are supported and approved by the organisation at all levels. There had been speculations in both countries about the success of the other's economy and researches have gone into the decision-maki

Friday, September 27, 2019

In France, appropriate conduct, trust and understanding of social Essay

In France, appropriate conduct, trust and understanding of social status are vital factors for success - Essay Example International business management comprises learning different cultures of the nations where a company intends to enter. Cross-cultural management helps to gain understanding about business tactics, human personality and leadership/management style that are significant for possessing effective business relationships with people in foreign countries (Bowie, 2008). The paper describes the business environment and culture of France and China for conducting business of a retail fashion organisation in the United Kingdom named River Island. The objective of the paper is to recognise the cross-cultural aspects of China and France with respect to leadership style and business practices which need to be considered by River Island in order to conduct business in foreign nations. Furthermore, the paper analyses the business environment and legal structure of both nations for assessing the suitability of conducting business. Business Environment of France France is regarded as the international cultural capital. It is one of the biggest and most diverse nations in Europe. France is also recognised as a modern nation among the European countries with respect to technology and business. France has always been the core of international business and trade. France is an extremely consolidated nation. Among many larger cities in France, Paris plays a significant part with respect to governmental regulations and business opportunities. France has advanced rail network and structured road transport system that offer smooth access to major capitals and metropolises (Nouel, 2005). Economic Environment France is known as the world’s fifth biggest economy with respect to gross domestic product (GDP). In the year 2007, the GDP of France was almost â‚ ¬1892 billion and inflation rate was about 1.5%. In the year 2002, France had accepted Euro as its domestic currency (Moore Stephens International Limited, 2009). France is also considered as one of the biggest exporters of the world. In the year 2008, France had exported US$767 billion worth of goods (MGI World, 2009). France not only has progressive industrial economy, but also is advanced in automobile industry, aerospace, information technology, electronics, chemicals and fashion industry. France is one of the significant members of G8 leading industrialised nations (MGI World, 2009). Fashion Retail Industry of France France plays a vital role in catalysing enthusiasm about fashion all through the nation. The fashion industry of France has acquired its acceptability from high-end and high creative sector. The brand management capability, affluence and commercial aptitude of France gradually dribbled over the mass fashion retail market segment by motivating the appearance of international brands (Girod, 2012). In the year 2009, the total income of French apparel retail industry was worth US$48,956.4 million which accounted for compound annual growth rate (CAGR) of 0.6% (Datamonitor, 2009). In order to

Thursday, September 26, 2019

Individual Reflection Report Essay Example | Topics and Well Written Essays - 750 words

Individual Reflection Report - Essay Example In addition, I also had difficulty getting through examinations and processing instructions for my various course requirements. As mentioned, I am not a native speaker and I still have a long way to go mastering the English language. It was extremely difficult particularly whenever I am about to take an exam. Reviewing the course and subjects was already difficult to begin with, especially whenever I had to deal with new words and concepts. So whenever there was an exam, my anxiety doubles up. Definitely, the language barrier was the main reason for slow progress in academics. In my classes, I double my effort to follow the instructions and syllabus needed for the course. Aside from taking notes, I also compare with other students so I could monitor my progress. I consult regularly with my professors to be able to ensure that I am catching up on the lessons. I have already missed a lot of things in my first year and I am determined to make it this time around. I feel that I am improv ing, little by little, so that eventually, I could reach my goals. At present, I am still working on making it better by continuously improving on my communication skills. By this, I do not only mean speaking the language, but more importantly, be able to get along well with other people and build relationships. In school, I am trying again to get better by taking the courses I failed last term, and doubling my efforts to successfully pass them this time. I have started building friendship with other foreign students who also share the same sentiments and hurdles with me. This way, we can assist each other in the adjustment processes. I talk to my professors regarding my performance, and seek help whenever I need it. Guidance is important for me at this point, as I need all the assistance I could get so I could truly get synchronized into the system. I engage in group studies, join groups that would help me improve my performance. I am now focusing on simultaneously mastering the la nguage and learning all the concepts being taught. More than memory work, I have to immerse myself into various situations and participate in activities that would allow me to create relationships and form a support group that would help me improve my performance. Eventually, I want to be really familiar with University life, finish my courses with flying course and eventually get a Degree in Business and Management. I want to have the capacity to eventually apply for a job in UK, a job that would not consider my being non-native a disadvantage. Later on, when I would be getting advanced courses, I would be able to really participate in the learning process even more. My perseverance would eventually lead me towards the achievement of my goals. So far, I think I am a work in progress, as I have already basically learned the language, and can now somehow communicate whenever I have to go out, do my errands, shop or simply interact with other people. I am slowly building my confidence to be able to engage in simple conversations even outside the university. Though there are still new challenges and hurdles that come along now that I am in the university, I think that with careful planning and evaluation, I can get my objectives done in time. CAREER As I said, I am taking up Business and Management because of my goal to secure a long tern job from the private sector. I want to given the chance to apply for corporate job in probably a bank, or in

Wednesday, September 25, 2019

Assignemt 4 ,investing Essay Example | Topics and Well Written Essays - 1000 words

Assignemt 4 ,investing - Essay Example The company places significant importance on innovation. This gives the company a cutting edge in comparison to its competitors. M.A.C cosmetics also defined as Makeup-Art and Cosmetics. The company was initiated by Frank Toskan and Frank Angelo in the year 1984. The concept of M.A.C was perceived initially by Frank Angelo. Toskan was a celebrated makeup artist and Angelo was the proprietor of chain of hair salon. The common interest in fashion shared by both brought the two together in creating the brand M.A.C. Angelo and Toskan realized the need of a reliable make up brand in the market. Both recognized the need of a makeup brand that was durable, creative and versatile. The makeup was mostly aimed for the makeup requirement at photo shoots. Està ©e Lauder in 1994 gained the controlling interest in MAC and the acquisition was settled in 1998. M.A.C is now one of the celebrated brands of Està ©e Lauder. In 1994 the MAC AIDS was introduced. The year before MAC was acquired by Estee Lauder Frank Angelo due to health complications passed away and Toskan also chose to exit from the company. MAC religiously don ates 100% of their selling profit from their brand Viva Glam to the MAC AIDS fund. John Demsey was appointed at the post of Group President in the year 2006. He is currently responsible for the brands M.A.C, Sean, John, La Mer, and Jo Malone, Bobbi Brown, Prescriptives under the Estee Lauder group. In the year 2005 Mr. John Demsey was appointed as Global Brand President of Estee Lauder after his appointment as the President and Managing Director of M.A.C from the year 1998. From the year 1991 till 1998 Mr. Demsey has held several positions with Estee Lauder, including the post of Senior Vice president of Sales and Education (Estee Lauder, USA & Canada). Before joining Estee Lauder Mr. Demsey worked for Revlon, Alexandra de Markoff , Lancaster cosmetics and Borghese Mr. Demsey currently also holds several executive retail positions

Tuesday, September 24, 2019

The Museum of London Essay Example | Topics and Well Written Essays - 1250 words

The Museum of London - Essay Example Many items were drawn into the museum between the 18th and the 19th century. Due to all these, the museum holds the most important historic collections in Britain. The government of the United Kingdom commissioned draughts men who had accurate skills in recording to operate the museum. Currently the museum of London has more than five thousand historical objects from the society’s collection that are documented. The database includes over more than three thousand items, which are digitized, and made available on their website. Inside the museum, there are historic objects that tell of a turbulent past of the country. The museum has intensified remains of the city whose dates reflect the times of the Roman Empire. In the London museum, one can discover the pre history of Britain and acquire knowledge on evolution of Britain from the time of the Roman Empire. The museum has the grandeur of medieval London and explores on the effects of the civil war, the plague, and the fires on the capital of United Kingdom (Humphrey, 2003:198). Some of the objects in the London museum were first shown to the natives of the country but now form part of the national museum. Other outstanding objects are missing in the museums record but the unique silver hanging bowl represents them all. The objects in the London museum range from the pre historic weapons and tools, the medieval pottery, woodblocks, and the bookbinding tools used by William Morris. There is also in the museum the clock made by Jacob Zech in Prague in the sixteenth century. The museum opts to expand the catalogue further in the future to cater for the emerging demands. Apart from all these the museum has also a hackney carriage, complete with a speaking tube that connects the museum guide to the audience or visitors for descriptive explanation incase of a stranger or tourist. The system has the ability to tune to any language to favor the visitor (Humphrey, 2003:204). The museums managing director, David Sp ence said that the present generation would shape the future of the museum. The museum is currently investigating the possibility of presenting more historic objects, which are currently present in other national museums. The Guildhall, which is the Faversham’s third best, was built on 1547 as a market hall by the efforts of the people of the town. The Guildhall is an open floor arcade provided to cover the interest of market traders as well as the customers. A popular building formula was common on the south east of England. The Guildhall was set on fire on 1814 as wellington was celebrating victory over the Napoleonic wars local yobs. The upper part of the hall had to be rebuilt. The facilitators took this opportunity to extend the hall by two bays to the north (Humphrey, 2003:212). The general outline of the hall remained the same but the designer worked in the then prevailing idiom and made it an arcade. The present elegancy of the Guildhall owes to the simplicity and goo d proportioning of flanks. Some of its windows are blind and solely reveal what would be monotony. A cornice neatly binds the hall to the tower and a continuous parapet that hides the low-pitched slate roof. The hall also has a fine Venetian window at the northern side end. Faversham is the only town in the whole of Europe that enjoys this service. St Bartholomew the great is an Anglican church

Monday, September 23, 2019

Energy - What Next Essay Example | Topics and Well Written Essays - 1500 words

Energy - What Next - Essay Example Offshore wind firms are more complex, inclusive of turbines, platforms, grids, cables, substations, interconnection and related construction activities. Currently, construction activities have centered in many rejoins of the U.K, representing over 3300MW of the entire capacity (Jay, 2008). I support the construction of these offshore winds with long-term charters of numerous highly specialized construction vessels and facilities to put up with the increasing dimensions of contemporary support structures, wind turbines, and balance of plant. Offshore wind farms are vital in their contribution to energy supply If these firms are constructed, they will be a suitable technology to meat the growing electricity demand, in a clean and sustainable way. Such firms will have minimal environmental impacts if they are logically well located relative to the places of electricity need. Further, higher wind speeds will increase energy production, since energy production is a purpose of the cube of the wind speed. I expect that a significant part of the future widely spread wind energy usage in U.K will be from offshore sites. Huge offshore wind farms are already in the planning phase of construction in several countries and especially in Europe. Just like Hirts put it, financial payback or economic viability of the farms depend largely on the renewable obligation Certificates, as well as on favorable wind conditions as compared to the sites constructed on land, I argue that the higher energy outcome has to recompense the extra installation and continuance costs. In constructing these farms, particularly siting large projects, a reliable and efficient offshore wind prediction is crucial (Burton & Jenkins, 2011). Present estimates based partially on U.K experience indicate that offshore wind energy can cost less than six cents per KW. In addition, capital costs are about 30-50 percent higher than those onshore because of bigger machine sizes, transporting and installing costs a t the sea, particularly offset by high-energy productions. However, just like onshore, I expect these prices to drop as technology advances and managers get more experience. As the European Wind Energy Association (2012) affirms, most offshore farms will be sited on monopiles or constructed on gravity foundations, there will be concrete structures stabilized by water or sand to allow the turbine towers to fit in. Monopiles must be included in these installations. They are long steel pipes, which are stroked, vibrated or drilled into the seabed to security levels then towers and platforms are installed on top of them. They will have a technical difficulty in mounting turbines on floating constructions, and monopiles get more expensive as one progress deeper into the water. In my opinion, technology has been growing rapidly for the past years and I can predict that technical advancements may make suspended offshore wind farms to be economically realistic in the future. Offshore wind f arms are important in energy providence. I support the construction of these farms basing on several factors. The resource, which is wind energy indirectly from the sun is extremely large, the costs of energy, though originally higher than those of onshore are affordable than most renewable technologies, and the associated risks are low. Constructing wind turbines at sea will limit the restraints that can be

Sunday, September 22, 2019

Asian American Literature Essay Example for Free

Asian American Literature Essay The stereotype created of Japanese men as military foes combined nationalism with racism. Since their physique has always been considered small, the danger from the Japanese was perceived to come from the Japanese Superman, possessed of uncanny discipline and fighting skills. Films, often punctuated with racial slurs, were quick to paint Japan’s treachery in battle, its brutality, and disregard for international rules of war. These stereotypic images carried over to Japanese-American men outside the context of the war. Pearl Harbor and the war years enabled Hollywood to revive the yellow peril characteristics and the fear of miscegenation. By the end of the war, Americans had learned to associate brutality and treachery with a Japanese face. Caricatures of the Japanese were found in the cartoons of the period. Warner Brothers, Looney Tunes, created a duck version of â€Å"The Jap† who had glasses, buckteeth and cries â€Å"oh sorry, sorry, sorry† (with slurred r’s). They also created â€Å"Tokyo Jokio† and â€Å"Bugs Bunny Nips the Nips. † The buck-toothed Japanese became a standard cartoon figure. Max Fleischer created a Popeye the Sailor cartoon entitled â€Å"You’re A Sap, Mr. Jap†, which is a song Popeye sings over and over. This cartoon showed the Japanese deceiving Popeye, causing him to cry out righteously: â€Å"Double-Crossing Japanese† The portrayal of women during this period fared no better. The common stereotype was the â€Å"Dragon Lady,† â€Å"Geisha Girl,† and â€Å"Tokyo Rose,† who had a penchant for White men, dressed in tight dresses, and bodies on display. They are sly, cruel, exotic sex objects, or subservient and hardworking. Shirley Geok-Lin Lim, in â€Å"Feminist and Ethnic Literary Theories in Asian American Literature† comments on how â€Å"the image of Japanese-American women usually remains on the margin, invisible, mute or constrained to limited stereotypic images of passion. † The media played on these stereotypes to sell misleading images to audiences, who wanted entertainment that was different from their normal lives and were willing to see and accept anything exotic. The stereotypes of Japanese and Japanese-American women were pervasive in the media because the media perpetuated these stereotypes through their portrayal of Japanese and Japanese-Americans. Unfortunately, for some, they still carry over in the perceptions of the American people. Japanese-Americans are challenging the stereotypical images of the past and have made a voice for themselves in American society. They are fighting against the persistent racism and sexism against themselves by establishing a unifying identity as Americans and monitoring the media’s representations. Although ethnic stereotyping is less common today than it was in the last century, it persists. The images are not so obviously offensive; consequently, many people do not recognize them as stereotypes. In terms of dramatic expression, then, the Japanese film labors under a heavy burden. If it portrays emotion within the traditional Japanese framework, it may achieve authenticity, but the effect is antiquated. If it portrays emotion within the Western framework, it comes across as meretricious and unconvincing. Films that try to blend the two modes often end up antiquated and unconvincing. Yet in animation, which lacks visual realism and features de-Japanized characters to begin with, the expression of emotion paradoxically takes on a more convincing sense of reality. This may explain why most of the serious and ambitious film efforts have used the vehicle of anime. Given the serious dramatic deficiency, Japanese live-action films can no longer tackle any serious or profound subject matter. In the context of contemporary Japanese film, then, anime often conveys a greater sense of reality than live-action films. The thin, insubstantial reality of animated film, that is to say, is more alive — literally, more animated — than the flesh-and-blood reality. And if anime is perceived as more real (i. e. , closer to physical reality) than live-action, this means that, increasingly, anime embodies the Japanese consciousness of reality. The Japanese conception of reality is undergoing a process of animation. The rise of anime as well as manga is a cultural by-product of modern Japans tendency to promote modernization and Westernization while rejecting its history and traditions. A medium that fuses elements of East and West, and lacks a clear national identity, could be considered international in a certain sense, and this is doubtless a major reason why anime has so many fans overseas. But the current state of affairs, in which anime represents the mainstream of Japanese cinema, is by no means desirable, inasmuch as it signifies an ever-widening gap between physical reality and peoples conception of it.

Saturday, September 21, 2019

A Perspective of Cultural Conflict in Classroom Essay Example for Free

A Perspective of Cultural Conflict in Classroom Essay This paper draws from the understanding that cultural differences and imbalance has extensively repressed the process of learning as well as literacy development. This factor is evident by the continual differential treatment of teachers on white and black children thus affecting the progress of colored children in literacy development. Learning literacy encompass the efforts employed by the teacher to help the child develop reading and writing skill in the second language. As such, this process occurs within the threshold of culture and is influenced by social factors ranging from the belief of the teacher and the ability of the children to literary skills. The evaluation of methods of literacy practice help in deigning validity and reliability of the instruments of instruction used in literacy acquisition and development amid cultural differences and conflicts reflects an element that formulates an important factor in situations where the teacher and his beliefs as well as the literacy practice extensively leverages the varying degrees of the whole language. Introduction Literacy acquisition and development is a pedagogical aspect that begins long before children commence their formal education as well as formal school instruction. During these years, children acquire skills and knowledge that are typified by literate behavior in a setting that is guided by socio-cultural manifestations. The whole process is influenced by a number of factors ranging from cultural implications, the beliefs of the teacher and the instruction methods for literacy practice. The teacher should emphasize on the development of literacy as a process that is ongoing, and through a classroom learning environment. This means that for the efficiency of literacy acquisition development, all aspects of literacy must develop simultaneously, with the language and literacy sharing similar features hence allowing students to encounter a natural hierarchy to the stages of development. Methods of Literacy Practice The complexity of literacy development rests on the pedestal of the children’s ability to effectively read and write in English as the formed literate culture. Delpit argues that our cultures and communities lay the basis on which differences in instructing children as they learn new language is evidenced (Delpit, 2006). This cultural bias and weakness presents a conflict which should be resolved by the teacher’s attempt to maximize the educational potential of children from colored racial background.   The teacher and his belief about literacy development play a significant role in the entire process of literacy and language development.   There is an interrelationship between literacy and language such that, the teacher should base his instruction on language; which plays a key role in building the foundation for reading and not on the racial backgrounds. Accordingly, the teacher should use the method of immersion to enable children develop literacy by being surrounded by spoken language. In so doing, children will not only learners to talk but will also encounter print language in charts labels and stories and an organized library which enables students to read and write in areas of the   print language. In addition, it is plausible to note that as a teacher, it is vital to use   a practical method of   instruction that help children demonstrate the literacy skill being learned in a context where the teacher uses good classroom management to root out racial power imbalance that exist in classrooms. As such, this should be done both in classroom and outside classroom situations. For example, Delpit contends that when people around children use language positively, things happen positively. Ideally, language, which the backbone of literacy, become part of life around children (Delpit,2006). This out of classroom situation means that a teacher should emphasis on the importance of language which is mirrored through books, literacy events and writing and thus children will learn the language at home, in town and in the villages where they are. In a classroom setting, demonstration of literacy skills should be enhanced by the teacher through modeling where children learn the four skills of language such as reading skills, writing skills, speaking skills and listening skills throughout the day. In this way, children will acquire and develop literacy skills by observing purposeful literacy in a myriad of ways. Furthermore, the teacher should advise parents to highly expect their children to talk thus relieving the whole process the pressure and tension of literacy development from learning in an environment that is cultural conflict. The teacher works on helping the students to learn literacy skills by working on these skills at appropriate levels. As a result, a teacher should provide children with enough materials that match their literacy levels and by catering for individualized differences; a teacher sets the pace of developing literacy skills thus structuring the class with expectation of leaning. To illustrate, the ways by which people respond and react during a conversation influences the behavior of a child and usually non verbal expressions such as smiles, cuddles and other remarks creates a verbal interaction that shapes the development of literacy. Therefore, acquiring and developing literacy skills does occur anywhere; at home, in groups, with relatives among others and this natural way should be used in helping the process of literacy acquisition and development. With the classroom, the teacher should create a collaborative learning environment where children have the opportunity to provide positive feedbacks to their peers which specifically is encouraging and constructive in terms of learning literacy skills. With regard to this, little children should be engaged in learning whether at home or in school the teacher should help the children to aim at better speaking skills, reading skills, writing skills and listening skills at school in activities that help them to make sense of their acquired literacy knowledge and skills. Racial, class, ethnic and gender conflicts influence the quantity of literacy instruction in a racially mixed class. However, a teacher should influence children and parents from disfranchised cultural groups to develop measures of subverting negative pressure dominant group. Delpit notes that the community environment as well as home leverages the literacy development of a child. As such, schools, homes, families and classroom are learning environments situated in the community. In this case, the out of class element extensively influences learning opportunities and gives a chance to take part in the process of literacy acquisition and development of their child (Delpit, 2006). Significantly, this narrows down to a cultural aspect in learning and impacts on the literacy development children acquire. For example, a child from a poverty stricken neighborhood encounters a disintegrated learning environment and owing to the fact they are likely to be face social emotional and behavioral conditions that are strong makes them develop non Standard English hence their literacy skills being interfered with. In addition, Delpit contends that the culture and environment directly relate to the ability of the child to develop vocabulary skills and thus the literacy development at kindergarten should be well structured because it determines how the child’s academic achievement varies in school and classroom. Children’s, socio behavioral, emotional self regulations are viewed within the precincts of cultural orientations   and all these are influenced by homes, families, schools and society at large. On this ground, Delpit postulates that the development of a child’s literacy skills should be allowed to take place at all times and in every place (Delpit, 2006). Accordingly, literacy is construed to be composite of varied dimensions that transcend the boundaries of classroom and society and this interplay strongly affect the learning opportunities that children are presented with both at home and in school. In light of this, there is considerable evidence that shows that proficient literacy obligate that children must have strong foundation in oral language; an element that borders phonological and vocabulary skills as well as the overall language skills which is basically determined by the cultural orientations. This falls in the wider dimension of influencing how a child demonstrates systematic and explicit ways of decoding, comprehending and writing language which is greatly impacted by the cultural base of the child. Due to the cultural influence in learning language and literacy skills, the preschool experience forms an important factor in the acquisition and development of literacy skills. Therefore, it has been speculated that achieving this learning element depends on the social economic status of the child’s family. Accordingly, children form less fortunate families begin their literacy levels late and without financial ability to buy literacy resource, many children from such backgrounds become literate very late. As such, the teacher should come to the aid of this group of children by working out a correlation that will improve home and classroom learning environment through what is inarguably called direct parent training and education. In essence, Delpit portends that parents from such economic thresholds should strongly embrace the concept of early preschool interventions in a bid to socially and academically make a vital difference in the literacy acquisition and development of their children. Similarly, the classroom environment influences the belief and mindsets of a teacher in their literacy development instruction. In essence, the attitude of the teacher over the children he is instruction posses a shared characteristic that   is marked by a safe and orderly environment high expectations for the literacy achievement of the students, strong educational leadership, the amount of time given to literacy instruction classroom management and available methods of evaluations and instructions. Accordingly, a flexible and homogenous literacy skill provides a more successful effect on reading, speaking and writing thus making the instruction children receive in the class more substantially. However, in the event of a heterogeneous literacy skill, it becomes difficult as the teacher to have clear cut expectations on the literacy achievement thus his beliefs may not allow him to substantially provide instruction that enhances literacy awareness. For the most vulnerable children in the black American community, the development of literacy skills is under certain progression challenges such as underachievement but Delpit shows that the social and motional support offered by the teacher creates a climate that leads to the efficiency in building literacy levels of children from multicultural backgrounds. The classroom setting should provide a highly social, emotional support and the teacher should therefore come in with a n instructional support which will systematically a stronger child literacy development and social outcomes. Particularly, such learning environment become important for children from the back community because they are typical of social problems and during the development of literacy skills, they may exhibit weak social skills. The engagement of children in different learning environment helps boots their motivation to learn and this contributes to their literacy growth. Conclusion From the foregoing discussion, it is evident that the type and amount of literacy instructions that a teacher should give to children in classroom and the continuous learning of literacy skills at home and in the society facilitates a constant and systematic literacy growth. Accordingly this involves a combination of methods that range from code focused strategies o holistic and meaning strategies prove to be the effective models of enhancing literacy development. Teachers therefore should use sustained interventions that range form intensive and balanced pedagogical aspects in literacy acquisition and development. Teachers therefore need to structure the instructional designs on the structure of the language and other social cultural elements that aids in the acquisition of literacy skills. Reference   Delpit, L (2006) Other People’s Children: Cultural Conflict in Classroom. New York: News press

Friday, September 20, 2019

Weak Form Efficient Market Hypothesis For Emerging Markets

Weak Form Efficient Market Hypothesis For Emerging Markets Literature Review The issue of market efficiency in emerging markets is of great significance for both foreign investors and policy makers in emerging economies. This project devotes large efforts to produce a thorough and in-depth literature review for this area. This topic is to be investigated from these aspects: theoretical foundation, methodologies of tests and empirical results. Firstly, traditional efficient market hypothesis (Fama, 1970; Makiel, 1973) and behavior finance theories developed in recent decades (Barbris, 1998; Shleifer, 2000) have formed two main schools of thought for the issue of market efficiency. Secondly, the evolution for a series of methodologies is important for testing market efficiency. Thirdly, the empirical evidence is reviewed by consideration three major factors: trade volume and non-linear behavior, structural breaks and market evolution through time. Finally, it also reflects some important policy implications for emerging markets. Many empirical studies have been widely carried to investigate the weak-form efficient market hypothesis for emerging markets, and the results are mixed. Generally, most of emerging markets are found to be inefficient. But for some countries, such as Istanbul, Egypt and Jordan, after correcting for institutional characteristics and trading conditions, such as thin trading and the presence of non-linearity, equity markets are found to be efficient. When structure break factors are taken into account, market efficiency is powerfully rejected for countries such as Argentina, Brazil, Greece and India. There is also evidence showing that initially emerging markets are inefficient, but over time they are moving toward to be more efficient, such as in Estonian, Lithuanian and Russia duo to economic liberalization policies. These results reflect some important policy implications. Infrequent trading and illiquidity of capital markets negatively affects market efficiency, so economic policy makers should devote efforts to minimize the institutional restriction and barriers on capital flow in the financial markets and to impose strict disclosure requirements, so that investors can easily access to high quality and reliable information. Improving liquidity of capital markets can provide lower borrowing costs for investors and greater opportunities for investment diversification with lower systematic risks. In addition, equity market liberalization is important to help achieving market development. It can reduce cost of capital and increase capital productivity with better capital allocation. Introduction: Due to the increasing globalization of financial markets, fast economic growth and adoption of financial liberalization policies for equity markets in emerging economies, it is widely indicated that equity investment in emerging economies can provide superior returns. Past decades have witnessed spectacular growth in both size and relative importance of emerging equity markets. The market capitalization of emerging market economies accounts for twelve percent of world market capitalization and has more than doubled, growing from less than $2 trillion in 1995 to $5 trillion in 2006 (Nally, 2010). By 2015, it is estimated that the combined GDP of emerging-market economies will surpass that of the top 20 developed economies (ibid). In addition, emerging market returns are weakly correlated with returns in developed markets, so international diversification with these emerging equities can give lower portfolio risks (Levy Sarnat, 1970). The potential high rates of returns and diversific ation benefits has attracted large number of foreign fund investors, so the investigation on whether emerging markets function efficiently is significantly important. By knowing degree of market efficiency, economy policy makers and regulators can gain insights to develop right institutional and regulatory frameworks to allocate scare resources efficiently, form favourable investment condition and obtain further economic growth. Therefore, this essay is going to investigate the weak-form market efficiency in emerging markets. The efficient market hypothesis by Fama (1970), Random Walk module by Makiel (1973) and behaviour finance theories are directed related to this issue and form the theoretical foundations. Section 1 will critically give the theoretical review based on the two schools of thought that are EMH and behaviour finance theories. Section 2 will give a brief review of methodologies adopted in literature review. Section 3 will give empirical review of the weak-form EMH for emerging markets. Section 4 will indicate some brief policy implications for emerging economies and section 5 is the conclusion with some directions for further research. Theoretic Review of EMH VS Behaviour Finance Efficient Market Hypothesis Fama (1970) defines an efficient financial market as one in which security prices always instantaneously and fully reflect all available information. No investors can earn expected abnormal return by analysing past known information. Market efficiency is attained by two key forces: investor rationality and arbitrage activities (Fama, 1970). EMH assumes that investors are rational and can process information correctly and efficiently. Although some investors are irrational and may overact or underact to new information, these judgement errors are independent and random, hence can cancel out each other without affecting prices (Fama, 1998). Therefore, on average, the whole market is efficient. In addition, since numerous profit-maximizing investors are competing to analyse, value and trade securities based on all available information to exploit arbitrage opportunities, on aggregate level, security prices are adjusted quickly to reflect the effect of new information (Fama, 1998). Secur ity prices are driven close to intrinsic values. Expected returns implicit in the current price of a security should reflect its underlying risk, and higher returns are earned only as compensations for bearing higher risk. There are two main modules that explain EMH: fair-game model and random walk model (RWM). The fair-game model is expressed as: Zj,t+1 =rj,t+1-E(rj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t), E(Zj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t)=0 (Copeland, Weston Shastri, 2005). Information in à Ã‚ ¤t is fully utilized to determine equilibrium expected returns. On average, the expected return on an asset E(rj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t) equals its actual return (rj,t+1), so that no expected abnormal return can be gained from past information. RWM gives much stronger condition for EMH. It assumes that successive price changes have a same normal distribution and are independent. Its logic is that because new information is unpredictable and reaches market randomly, so under EMH, the resulting security price changes must be also unpredictable and random (Malkiel, 1973; Malkiel, 2003). No profit can be made from past information. There are three sub-hypotheses of EMH depending on the level of available information set (Fa ma, 1991). Firstly, market is weak-form efficient when prices reflect all security market information such as historical prices. Secondly, market is semistrong-form efficient when prices reflect all public information such as corporate news and financial statements. Thirdly, market is strong-form efficient when prices reflect all public and private information. Behaviour Finance Theories Figure1: Conceptual Framework of Behaviour Finance Source: Shleifer (2000) However, behaviour finance challenges EMH because it argues that psychological biases lead to investor irrationality and limits to arbitrage impede exploitation of mispricing opportunities (Shleifer, 2002). Psychological bias results into systematic overreaction or underreacion among investors. Many behaviour finance theories have been successfully developed to explain some market anomalies. Conservatism biases lead people adjust slowly to new information and hence the underreaction to new information leads to short-run momentum, while representativeness heuristic makes investors believe that past good stock performance will continue and people overreact to information (Barberis, Shleifer Vishny, 1998). Additionally, overconfidence causes investors to overestimate the precision of their own analyses and to neglect public signals (Daniel, Hirshleifer Subrahmanyam, 1998). Under positive (negative) private signal (which is shown in following graph), informed investors overreact and se curity is overpriced (underpriced). When public information becomes available, biased self-attribution causes security to be even more overpriced (underpriced). Eventually, public information proves initial investment judgement is wrong, so price is driven back to intrinsic value (Daniel et al, 1998). It explains that overconfidence leads to short-run return momentum and price correction leads to long-run return reversal. Figure 2: Overconfidence and Self-attributed bias Source: Daniel, Hirshleifer Subrahmanyam (1998) Moreover, classification is a human natural instinct to process information (Barberis Shleifer, 2003). Investors naturally classify stocks by styles, so styles returns are highly positive correlated. There are two kinds of investors: style switchers and fundamental traders. Style switchers are unsophisticated investors and chase investment styles based on past relative stock performance. When there is good news about stock X (shown following graph), they will drain funds away from less attractive style Y. It will push up stock Xs price, even higher than its intrinsic value, but further reduce stock Ys price. However, fundamental traders recognize stock Y is underpriced (Barberis et al, 2003). They arbitrage away mispricing opportunities and drive overpriced stocks back toward intrinsic value. Figure 3: Switchers and Fundamental Traders Source: Barberis Shleifer, (2003) On the other hand, limits to arbitrage may obstruct information to be impounded into prices, duo to the fundamental risk and implementation costs. Noise trader risk would prevent rational investors from arbitraging (Delong, Summer Waldmann, 1990). Pessimistic noise trader drive price below intrinsic value, arbitrageurs can buy the asset, but bear risk of further deviation from the intrinsic value when noise traders become even more pessimistic and price goes down even further (Delong et al, 1990). Arbitrageurs usually have short horizon and must liquidate before price recovers, so they will incur loss. The agency problems between professionals and investors also affect arbitrage (Shleifer Vishny, 1997), so not all mispricing would be arbitraged away to lead market become efficient. However, Fama (1998) argues that behaviour finance theories do well only on the anomalies they are specially designed to explain and cannot be generalized to the entire market. Rubinstein (2001) also argues that investor overconfidence would make market à ¢Ã¢â€š ¬Ã…“hyper-rationalà ¢Ã¢â€š ¬?. Methodologies Adopted to Test the Weak-form EMH Empirical researches on testing weak-form EMH can be divided into three broad categories. Firstly, they tests security return independence. If time-series pattern of security returns shows insignificant (significant) autocorrelations, then weak-form EMH holds (is rejected) (Copeland, Weston Shastri, 2005). Secondly, they test return momentum effect. If portfolio of stocks with higher returns in the short past continues to earn higher abnormal returns in the subsequent short term, then short-run past returns contain information that could predict future returns, so EMH will not hold (Copeland et al, 2005). Thirdly, they test technical trading rules. If no trading rules that consistently derive abnormal profits can be found, then weak-form EMH holds. A series of research methodologies have been developed to exam the EMH. The runs test is non-parametric, which is used to determine whether successive prices changes are independent. Unit root tests involve three different methods to test the null hypothesis of a unit root: the Augmented Dickey-Fuller (ADF) test (1979), the Phillips-Peron (PP) test (1988) and the Kwiatkowski, Phillioh, Achmidt and Shin (KPSS) test (1992). Multiple variance ratio (MVR) tests are adopted to detect autocorrelation and heteroskedasticity in returns (Chow Denning, 1993). Empirical Results of Weak-form EMH for Emerging Markets The research results for testing weak-form efficiency on the emerging markets are mixed. World Bank study reports significant market inefficiency for 19 emerging equity markets (Claessens, Dasgupta Glen, 1995). Latin American emerging markets of Argentina, Brazil, Chile, and Mexico are weak-form EMH (Urrutia, 1995), but under the variance ratio test, RWH is rejected (Ojah Karemera, 1999). Under ADF test, EMH is also generally supported for six Latin American stock markets (Choundhry, 1997). For the emerging markets in Asia, major Asian markets are weak-form inefficient, such as Korea and Taiwan (Cheung, Wong Ho, 1993), Singpore and Thiland (Huang, 1995), but some find it is efficient for Hong Kong, Singapore and Japan (Chan, Gup Pan, 1992). When the observed index levels are used, both RWH and EMH are rejected for three equity markets of Saudi Arabia, Kuwait, and Bahrain after adjusting for infrequent trading , but when the corrected true indices are used, RWH is accepted (Abraha m et al, 2002). RWH is rejected in five Middle Eastern emerging markets, Jordan, Morocco, Egypt, Israel, and Turkey (Omran and Farrar, 2001). Weak-form efficiency is rejected for Saudi and Palestinian financial market and inefficiency might be due to delay in operations and high transaction cost, thinness of trading and illiquidity in the market (Nourredine Kababa, 1998; Award Daraghma, 2009). Many researches find that emerging markets are becoming more efficient due to the liberalization policies. Istanbul stock exchange was inefficient in the early times but it becomes more efficient as the country started liberalization and deregulation (Antonios, Ergul Holmes, 1997). 4.1 Thin Trading and Non-linearity It is argued that such mixed evidences of the weak-form EMH in emerging markets are only reliable if the methodologies adopted take accounts for the institutional characteristics and trading conditions of the markets, such as thin trading and the presence of non-linearity (Antoniou, Ergul Holmes, 1997). Ignoring these factors may lead to statistical illusions regarding efficiency. The conventional tests of efficiency based on linear model have been developed to test markets with high levels of liquidity, sophisticated investors with access to reliable information and few institutional impediments (Antoniou, Ergul Holmes, 1997). Therefore they are not suitable for testing EMH for emerging markets with characteristics of thin trading, low liquidity and less well informed investors with access to unreliable information. Thin trading will bring serious serial correlation (Fisher, 1996), so the observed dependence does not necessarily represent serial correlation among securities return s. In addition, prices responds to information in a non-linear behavior especially during the early development stages of emerging markets (Schatzberg Reiber, 1992), so if the return generating process is non-linear but a linear model is used to test efficiency, then EMH may be wrongly accepted. This is because non-linear systems such as à ¢Ã¢â€š ¬Ã…“chaoticà ¢Ã¢â€š ¬? ones look very similar to a random walk (Savit, 1988). However, the conventional tests cannot recognize this problem. There are several reasons for the existence of non-linear reaction of price to information in emerging markets. Transaction costs are high, information is relatively not reliable and market is illiquid or there are restrictions on trading (Stoll Whaley, 1990). As a result, investors do not always respond instantaneously to the information, which contradicts the assumptions of investor rationality and linear response of price. Scheinkman and LeBaron (1989) and Peters (1991) also empirically support th e non-linearity of stock returns. A number of studies have researched the impact of thin trading (Fisher, 1966; Dimson, 1979; Cohen, 1978; Lo Mackinlay, 1990). Many empirical studies also have taken account of the non-linearity in price series and remove the impact of thin trading by the AR (1) model proposed by Miller (1994). Antoniou, Ergul and Holmes (1997) find that there is apparent predictability of stock returns for Istanbul stock market, but after considering the impact of thin trading, the random walk hypothesis is accepted and the market is informationally efficient for 1990 onwards. Abuzarour (2005) examines the effect of non-trading on market efficiency for three emerging Arabian equity markets: Jordan, Egypt and Palestine using the variance ratio test and the run test during the period of 1992 and 2004. Both random walk hypothesis and weak form efficiency are rejected when the observed index levels are used. However, when the indices are corrected by the Miller, Muthuswamy and Whaley methodologies (1994 ) to take account for thin trading, weak-form EMH is accepted for Egypt and Jordan stock market but it is still rejected for Palestine. All these empirical researches suggest that markets become more efficient when trading volume is high, information is much reliable and institutional frameworks are appropriate. 4.2 Structural Breaks Research on efficiency for emerging markets should not only take account for institutional characteristics and trading conditions, but also should take account for the structural breaks in the underlying series that arise from the liberalization. Ignoring structural breaks can lead to wrong inference that these indices are following random walks. Many emerging countries are liberalizing their financial markets with various degrees (IFC, 1997) and such structure changes would have affected their equity markets (Bekaert et al, 2002; Henry 2000). For instance, huge shocks occurred for equity index level for Greece, Malaysia and Philippines in late 1980s and early 1990s, which are around the same year of their market liberalization. As Perron (1989) have demonstrated that traditional standard tests for RWH in stock prices have low power against the alternative hypothesis in small samples, and the problem is especially serious when structural changes are involved. Thus failure to consider these breaking points may wrongly support the RWH. Therefore, many empirical researches try to incorporate the structural breaks factor by more powerful test methods, such as the Zivot- Andrew sequential test (Zivot Andrew, 1992). Chaudhuri and Wu (2001) adopt both the standard ADF test and Zivot- Andrew sequential method to test the EMH in seventeen emerging markets: Argentina, Brazil, Chile, Colombia, Greece, India, Jordan, Korea, Malaysia, Mexico, Nigeria, Pakistan, Philippines, Taiwan, Thailand, Venezuela, and Zimbabwe. Results for the ADF test without breaks to each series tend to show non-rejection of the RWH. However, results for the Zivot- Andrew test with structural breaks show that RWH can be powerfully rejected at the one percent significant level in ten markets: Argentina, Brazil, Greece, India, Malaysia, Mexico, Nigeria, Philippines, Taiwan and Zimbabwe (Chaudhuri Wu, 2001). 4.3 Market Evolution Although structural breaks have been taken into account in many researches, it is argued that standard techniques are still not fit to test the weak-form EHM for emerging market, because they are not able to evaluate the evolving efficiency in emerging markets. It is also argued that methods such as a time varying parameter model and Kalman Filter technique not only can indicate the movement of stock returns from inefficiency to efficiency, but also can measure the timing of the movement towards full efficiency(Rockinger Urga, 2000; Zalewska-Mitura Hall, 1999). It is generally agreed that emerging markets are evolving from inefficiency to efficiency with the higher disclosure degree of firm practices, high trading volume and lower institutional barriers to trade (Cornelius, 1994). According to Laurence (1986), the methods of OLS or GMM test market efficiency over the whole period and hardly capture the tendency towards efficiency, so under these methods, early inefficiency would wr ongly lead to the conclusion that there are profit opportunities based on the past asset price movement. In addition, the variance of the error process in the conventional test models is not constant over time, so if this changing variance structure is omitted and has a serial correlation property, then market efficiency would be incorrectly rejected (Hall Urga, G2002). Hall and Urga (2002) deal with these problems by using the Kalman Filter and combing the time varying parameter model with a standard GARCH-M model (generalized autoregressive conditional heteroscedasticity in mean). They apply this procedure to the two indexes of Russian stock market from 1995 to 2000. And find that with regard to RTS index (Russian Trading System), the market is initially inefficient and it takes about two and a half years to become efficient, while for the ASPGEN Index (Skate Press Agency General), the market is still predictable. There is evidence of a tendency towards being efficient. Kvedaras and Basdevant (2002) also investigate the market efficiency in the three Baltic States: Estonia, Latvia and Lithuania by using the time-varying variance ratio statistic robust to heteroscedasticity based on time-varying autocorrelations. They find a clear trajectory to weak-form efficiency in the Estonian and Lithuanian capital markets. Its relatively small inefficiency ca n be explained by transaction costs and information acquiring costs (Grossman and Stiglitz, 1980). In the Latvian market, it is inefficient even at the very end of the analyzed period. Policy Implications These results have some important implications for developing effective institutional and regulatory frameworks. Since infrequent trading negatively affects market efficiency and liquidity in emerging markets, economic policy makers should pay attention to minimize the institutional restriction and barriers on capital flow in the financial markets, impose strict disclosure requirements and ensure that investors can easily access to high quality and reliable information. Improving liquidity of capital markets can provide lower borrowing costs for investors and greater opportunities for investment diversification with lower systematic risks. In addition, equity market liberalization is important to help achieving market development. It can reduce cost of capital and increase capital productivity with better capital allocation. Conclusion 6.1 Short Summary In conclusion, as two main schools of thought in modern financial theories, there is a hot debate between efficient market hypothesis and behaviour finance. EMH asserts that financial markets are informationally efficient and equity stock prices instantaneously and fully reflect all known information. While behaviour finance argues that psychological biases lead to investor irrationality and limits to arbitrage impede exploitation of mispricing opportunities, so market is not efficient. There are wide empirical researches on the issue of market efficiency in emerging markets with mixed results. It is generally found that most of emerging markets are still inefficient, but after correcting for institutional characteristics and trading conditions, such as thin trading and the presence of non-linearity, some researches find that equity markets are efficient for some countries such as for Istanbul, Egypt and Jordan. When structure break factors are taken into account, market efficiency i s powerfully rejected for most emerging countries such as Argentina, Brazil, Greece and India. There are also some evidence shows that duo to economic liberalization policies, many emerging markets are moving towards more efficiency such as Estonian, Lithuanian and Russia. 6.2 Limitations of Empirical Researches and Proposed Further Research However, there are some limitations involved in these empirical researches. Some researches ignore whether the distribution is normal or not. Others using equally weighted indices may bias the results. The possible auto-correlation might be due to the noise traders but doesnt imply return predictability (Cuthberston, 1996). Most of these studies focus on the test of time series of equity return to investigate EMH, but don not investigate the momentum effect or the profitability of technical trading to earn abnormal return. Therefore, further research can be extended in several dimensions. Firstly, it suggests trying to combine the tests of momentum effect or technical trading rules with the time series tests to make more robust conclusions. Secondly, since most of researches focus on traditional EMH, it can consider the factors of investor behaviour, such as psychologies bias and limits to arbitrage to do further in-depth testing of EMH. Finally, further researches for more novel and accurate methodologies of testing EMH are significantly essential. Weak Form Efficient Market Hypothesis For Emerging Markets Weak Form Efficient Market Hypothesis For Emerging Markets Literature Review The issue of market efficiency in emerging markets is of great significance for both foreign investors and policy makers in emerging economies. This project devotes large efforts to produce a thorough and in-depth literature review for this area. This topic is to be investigated from these aspects: theoretical foundation, methodologies of tests and empirical results. Firstly, traditional efficient market hypothesis (Fama, 1970; Makiel, 1973) and behavior finance theories developed in recent decades (Barbris, 1998; Shleifer, 2000) have formed two main schools of thought for the issue of market efficiency. Secondly, the evolution for a series of methodologies is important for testing market efficiency. Thirdly, the empirical evidence is reviewed by consideration three major factors: trade volume and non-linear behavior, structural breaks and market evolution through time. Finally, it also reflects some important policy implications for emerging markets. Many empirical studies have been widely carried to investigate the weak-form efficient market hypothesis for emerging markets, and the results are mixed. Generally, most of emerging markets are found to be inefficient. But for some countries, such as Istanbul, Egypt and Jordan, after correcting for institutional characteristics and trading conditions, such as thin trading and the presence of non-linearity, equity markets are found to be efficient. When structure break factors are taken into account, market efficiency is powerfully rejected for countries such as Argentina, Brazil, Greece and India. There is also evidence showing that initially emerging markets are inefficient, but over time they are moving toward to be more efficient, such as in Estonian, Lithuanian and Russia duo to economic liberalization policies. These results reflect some important policy implications. Infrequent trading and illiquidity of capital markets negatively affects market efficiency, so economic policy makers should devote efforts to minimize the institutional restriction and barriers on capital flow in the financial markets and to impose strict disclosure requirements, so that investors can easily access to high quality and reliable information. Improving liquidity of capital markets can provide lower borrowing costs for investors and greater opportunities for investment diversification with lower systematic risks. In addition, equity market liberalization is important to help achieving market development. It can reduce cost of capital and increase capital productivity with better capital allocation. Introduction: Due to the increasing globalization of financial markets, fast economic growth and adoption of financial liberalization policies for equity markets in emerging economies, it is widely indicated that equity investment in emerging economies can provide superior returns. Past decades have witnessed spectacular growth in both size and relative importance of emerging equity markets. The market capitalization of emerging market economies accounts for twelve percent of world market capitalization and has more than doubled, growing from less than $2 trillion in 1995 to $5 trillion in 2006 (Nally, 2010). By 2015, it is estimated that the combined GDP of emerging-market economies will surpass that of the top 20 developed economies (ibid). In addition, emerging market returns are weakly correlated with returns in developed markets, so international diversification with these emerging equities can give lower portfolio risks (Levy Sarnat, 1970). The potential high rates of returns and diversific ation benefits has attracted large number of foreign fund investors, so the investigation on whether emerging markets function efficiently is significantly important. By knowing degree of market efficiency, economy policy makers and regulators can gain insights to develop right institutional and regulatory frameworks to allocate scare resources efficiently, form favourable investment condition and obtain further economic growth. Therefore, this essay is going to investigate the weak-form market efficiency in emerging markets. The efficient market hypothesis by Fama (1970), Random Walk module by Makiel (1973) and behaviour finance theories are directed related to this issue and form the theoretical foundations. Section 1 will critically give the theoretical review based on the two schools of thought that are EMH and behaviour finance theories. Section 2 will give a brief review of methodologies adopted in literature review. Section 3 will give empirical review of the weak-form EMH for emerging markets. Section 4 will indicate some brief policy implications for emerging economies and section 5 is the conclusion with some directions for further research. Theoretic Review of EMH VS Behaviour Finance Efficient Market Hypothesis Fama (1970) defines an efficient financial market as one in which security prices always instantaneously and fully reflect all available information. No investors can earn expected abnormal return by analysing past known information. Market efficiency is attained by two key forces: investor rationality and arbitrage activities (Fama, 1970). EMH assumes that investors are rational and can process information correctly and efficiently. Although some investors are irrational and may overact or underact to new information, these judgement errors are independent and random, hence can cancel out each other without affecting prices (Fama, 1998). Therefore, on average, the whole market is efficient. In addition, since numerous profit-maximizing investors are competing to analyse, value and trade securities based on all available information to exploit arbitrage opportunities, on aggregate level, security prices are adjusted quickly to reflect the effect of new information (Fama, 1998). Secur ity prices are driven close to intrinsic values. Expected returns implicit in the current price of a security should reflect its underlying risk, and higher returns are earned only as compensations for bearing higher risk. There are two main modules that explain EMH: fair-game model and random walk model (RWM). The fair-game model is expressed as: Zj,t+1 =rj,t+1-E(rj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t), E(Zj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t)=0 (Copeland, Weston Shastri, 2005). Information in à Ã‚ ¤t is fully utilized to determine equilibrium expected returns. On average, the expected return on an asset E(rj,t+1à ¯Ã‚ ½Ã…“à Ã‚ ¤t) equals its actual return (rj,t+1), so that no expected abnormal return can be gained from past information. RWM gives much stronger condition for EMH. It assumes that successive price changes have a same normal distribution and are independent. Its logic is that because new information is unpredictable and reaches market randomly, so under EMH, the resulting security price changes must be also unpredictable and random (Malkiel, 1973; Malkiel, 2003). No profit can be made from past information. There are three sub-hypotheses of EMH depending on the level of available information set (Fa ma, 1991). Firstly, market is weak-form efficient when prices reflect all security market information such as historical prices. Secondly, market is semistrong-form efficient when prices reflect all public information such as corporate news and financial statements. Thirdly, market is strong-form efficient when prices reflect all public and private information. Behaviour Finance Theories Figure1: Conceptual Framework of Behaviour Finance Source: Shleifer (2000) However, behaviour finance challenges EMH because it argues that psychological biases lead to investor irrationality and limits to arbitrage impede exploitation of mispricing opportunities (Shleifer, 2002). Psychological bias results into systematic overreaction or underreacion among investors. Many behaviour finance theories have been successfully developed to explain some market anomalies. Conservatism biases lead people adjust slowly to new information and hence the underreaction to new information leads to short-run momentum, while representativeness heuristic makes investors believe that past good stock performance will continue and people overreact to information (Barberis, Shleifer Vishny, 1998). Additionally, overconfidence causes investors to overestimate the precision of their own analyses and to neglect public signals (Daniel, Hirshleifer Subrahmanyam, 1998). Under positive (negative) private signal (which is shown in following graph), informed investors overreact and se curity is overpriced (underpriced). When public information becomes available, biased self-attribution causes security to be even more overpriced (underpriced). Eventually, public information proves initial investment judgement is wrong, so price is driven back to intrinsic value (Daniel et al, 1998). It explains that overconfidence leads to short-run return momentum and price correction leads to long-run return reversal. Figure 2: Overconfidence and Self-attributed bias Source: Daniel, Hirshleifer Subrahmanyam (1998) Moreover, classification is a human natural instinct to process information (Barberis Shleifer, 2003). Investors naturally classify stocks by styles, so styles returns are highly positive correlated. There are two kinds of investors: style switchers and fundamental traders. Style switchers are unsophisticated investors and chase investment styles based on past relative stock performance. When there is good news about stock X (shown following graph), they will drain funds away from less attractive style Y. It will push up stock Xs price, even higher than its intrinsic value, but further reduce stock Ys price. However, fundamental traders recognize stock Y is underpriced (Barberis et al, 2003). They arbitrage away mispricing opportunities and drive overpriced stocks back toward intrinsic value. Figure 3: Switchers and Fundamental Traders Source: Barberis Shleifer, (2003) On the other hand, limits to arbitrage may obstruct information to be impounded into prices, duo to the fundamental risk and implementation costs. Noise trader risk would prevent rational investors from arbitraging (Delong, Summer Waldmann, 1990). Pessimistic noise trader drive price below intrinsic value, arbitrageurs can buy the asset, but bear risk of further deviation from the intrinsic value when noise traders become even more pessimistic and price goes down even further (Delong et al, 1990). Arbitrageurs usually have short horizon and must liquidate before price recovers, so they will incur loss. The agency problems between professionals and investors also affect arbitrage (Shleifer Vishny, 1997), so not all mispricing would be arbitraged away to lead market become efficient. However, Fama (1998) argues that behaviour finance theories do well only on the anomalies they are specially designed to explain and cannot be generalized to the entire market. Rubinstein (2001) also argues that investor overconfidence would make market à ¢Ã¢â€š ¬Ã…“hyper-rationalà ¢Ã¢â€š ¬?. Methodologies Adopted to Test the Weak-form EMH Empirical researches on testing weak-form EMH can be divided into three broad categories. Firstly, they tests security return independence. If time-series pattern of security returns shows insignificant (significant) autocorrelations, then weak-form EMH holds (is rejected) (Copeland, Weston Shastri, 2005). Secondly, they test return momentum effect. If portfolio of stocks with higher returns in the short past continues to earn higher abnormal returns in the subsequent short term, then short-run past returns contain information that could predict future returns, so EMH will not hold (Copeland et al, 2005). Thirdly, they test technical trading rules. If no trading rules that consistently derive abnormal profits can be found, then weak-form EMH holds. A series of research methodologies have been developed to exam the EMH. The runs test is non-parametric, which is used to determine whether successive prices changes are independent. Unit root tests involve three different methods to test the null hypothesis of a unit root: the Augmented Dickey-Fuller (ADF) test (1979), the Phillips-Peron (PP) test (1988) and the Kwiatkowski, Phillioh, Achmidt and Shin (KPSS) test (1992). Multiple variance ratio (MVR) tests are adopted to detect autocorrelation and heteroskedasticity in returns (Chow Denning, 1993). Empirical Results of Weak-form EMH for Emerging Markets The research results for testing weak-form efficiency on the emerging markets are mixed. World Bank study reports significant market inefficiency for 19 emerging equity markets (Claessens, Dasgupta Glen, 1995). Latin American emerging markets of Argentina, Brazil, Chile, and Mexico are weak-form EMH (Urrutia, 1995), but under the variance ratio test, RWH is rejected (Ojah Karemera, 1999). Under ADF test, EMH is also generally supported for six Latin American stock markets (Choundhry, 1997). For the emerging markets in Asia, major Asian markets are weak-form inefficient, such as Korea and Taiwan (Cheung, Wong Ho, 1993), Singpore and Thiland (Huang, 1995), but some find it is efficient for Hong Kong, Singapore and Japan (Chan, Gup Pan, 1992). When the observed index levels are used, both RWH and EMH are rejected for three equity markets of Saudi Arabia, Kuwait, and Bahrain after adjusting for infrequent trading , but when the corrected true indices are used, RWH is accepted (Abraha m et al, 2002). RWH is rejected in five Middle Eastern emerging markets, Jordan, Morocco, Egypt, Israel, and Turkey (Omran and Farrar, 2001). Weak-form efficiency is rejected for Saudi and Palestinian financial market and inefficiency might be due to delay in operations and high transaction cost, thinness of trading and illiquidity in the market (Nourredine Kababa, 1998; Award Daraghma, 2009). Many researches find that emerging markets are becoming more efficient due to the liberalization policies. Istanbul stock exchange was inefficient in the early times but it becomes more efficient as the country started liberalization and deregulation (Antonios, Ergul Holmes, 1997). 4.1 Thin Trading and Non-linearity It is argued that such mixed evidences of the weak-form EMH in emerging markets are only reliable if the methodologies adopted take accounts for the institutional characteristics and trading conditions of the markets, such as thin trading and the presence of non-linearity (Antoniou, Ergul Holmes, 1997). Ignoring these factors may lead to statistical illusions regarding efficiency. The conventional tests of efficiency based on linear model have been developed to test markets with high levels of liquidity, sophisticated investors with access to reliable information and few institutional impediments (Antoniou, Ergul Holmes, 1997). Therefore they are not suitable for testing EMH for emerging markets with characteristics of thin trading, low liquidity and less well informed investors with access to unreliable information. Thin trading will bring serious serial correlation (Fisher, 1996), so the observed dependence does not necessarily represent serial correlation among securities return s. In addition, prices responds to information in a non-linear behavior especially during the early development stages of emerging markets (Schatzberg Reiber, 1992), so if the return generating process is non-linear but a linear model is used to test efficiency, then EMH may be wrongly accepted. This is because non-linear systems such as à ¢Ã¢â€š ¬Ã…“chaoticà ¢Ã¢â€š ¬? ones look very similar to a random walk (Savit, 1988). However, the conventional tests cannot recognize this problem. There are several reasons for the existence of non-linear reaction of price to information in emerging markets. Transaction costs are high, information is relatively not reliable and market is illiquid or there are restrictions on trading (Stoll Whaley, 1990). As a result, investors do not always respond instantaneously to the information, which contradicts the assumptions of investor rationality and linear response of price. Scheinkman and LeBaron (1989) and Peters (1991) also empirically support th e non-linearity of stock returns. A number of studies have researched the impact of thin trading (Fisher, 1966; Dimson, 1979; Cohen, 1978; Lo Mackinlay, 1990). Many empirical studies also have taken account of the non-linearity in price series and remove the impact of thin trading by the AR (1) model proposed by Miller (1994). Antoniou, Ergul and Holmes (1997) find that there is apparent predictability of stock returns for Istanbul stock market, but after considering the impact of thin trading, the random walk hypothesis is accepted and the market is informationally efficient for 1990 onwards. Abuzarour (2005) examines the effect of non-trading on market efficiency for three emerging Arabian equity markets: Jordan, Egypt and Palestine using the variance ratio test and the run test during the period of 1992 and 2004. Both random walk hypothesis and weak form efficiency are rejected when the observed index levels are used. However, when the indices are corrected by the Miller, Muthuswamy and Whaley methodologies (1994 ) to take account for thin trading, weak-form EMH is accepted for Egypt and Jordan stock market but it is still rejected for Palestine. All these empirical researches suggest that markets become more efficient when trading volume is high, information is much reliable and institutional frameworks are appropriate. 4.2 Structural Breaks Research on efficiency for emerging markets should not only take account for institutional characteristics and trading conditions, but also should take account for the structural breaks in the underlying series that arise from the liberalization. Ignoring structural breaks can lead to wrong inference that these indices are following random walks. Many emerging countries are liberalizing their financial markets with various degrees (IFC, 1997) and such structure changes would have affected their equity markets (Bekaert et al, 2002; Henry 2000). For instance, huge shocks occurred for equity index level for Greece, Malaysia and Philippines in late 1980s and early 1990s, which are around the same year of their market liberalization. As Perron (1989) have demonstrated that traditional standard tests for RWH in stock prices have low power against the alternative hypothesis in small samples, and the problem is especially serious when structural changes are involved. Thus failure to consider these breaking points may wrongly support the RWH. Therefore, many empirical researches try to incorporate the structural breaks factor by more powerful test methods, such as the Zivot- Andrew sequential test (Zivot Andrew, 1992). Chaudhuri and Wu (2001) adopt both the standard ADF test and Zivot- Andrew sequential method to test the EMH in seventeen emerging markets: Argentina, Brazil, Chile, Colombia, Greece, India, Jordan, Korea, Malaysia, Mexico, Nigeria, Pakistan, Philippines, Taiwan, Thailand, Venezuela, and Zimbabwe. Results for the ADF test without breaks to each series tend to show non-rejection of the RWH. However, results for the Zivot- Andrew test with structural breaks show that RWH can be powerfully rejected at the one percent significant level in ten markets: Argentina, Brazil, Greece, India, Malaysia, Mexico, Nigeria, Philippines, Taiwan and Zimbabwe (Chaudhuri Wu, 2001). 4.3 Market Evolution Although structural breaks have been taken into account in many researches, it is argued that standard techniques are still not fit to test the weak-form EHM for emerging market, because they are not able to evaluate the evolving efficiency in emerging markets. It is also argued that methods such as a time varying parameter model and Kalman Filter technique not only can indicate the movement of stock returns from inefficiency to efficiency, but also can measure the timing of the movement towards full efficiency(Rockinger Urga, 2000; Zalewska-Mitura Hall, 1999). It is generally agreed that emerging markets are evolving from inefficiency to efficiency with the higher disclosure degree of firm practices, high trading volume and lower institutional barriers to trade (Cornelius, 1994). According to Laurence (1986), the methods of OLS or GMM test market efficiency over the whole period and hardly capture the tendency towards efficiency, so under these methods, early inefficiency would wr ongly lead to the conclusion that there are profit opportunities based on the past asset price movement. In addition, the variance of the error process in the conventional test models is not constant over time, so if this changing variance structure is omitted and has a serial correlation property, then market efficiency would be incorrectly rejected (Hall Urga, G2002). Hall and Urga (2002) deal with these problems by using the Kalman Filter and combing the time varying parameter model with a standard GARCH-M model (generalized autoregressive conditional heteroscedasticity in mean). They apply this procedure to the two indexes of Russian stock market from 1995 to 2000. And find that with regard to RTS index (Russian Trading System), the market is initially inefficient and it takes about two and a half years to become efficient, while for the ASPGEN Index (Skate Press Agency General), the market is still predictable. There is evidence of a tendency towards being efficient. Kvedaras and Basdevant (2002) also investigate the market efficiency in the three Baltic States: Estonia, Latvia and Lithuania by using the time-varying variance ratio statistic robust to heteroscedasticity based on time-varying autocorrelations. They find a clear trajectory to weak-form efficiency in the Estonian and Lithuanian capital markets. Its relatively small inefficiency ca n be explained by transaction costs and information acquiring costs (Grossman and Stiglitz, 1980). In the Latvian market, it is inefficient even at the very end of the analyzed period. Policy Implications These results have some important implications for developing effective institutional and regulatory frameworks. Since infrequent trading negatively affects market efficiency and liquidity in emerging markets, economic policy makers should pay attention to minimize the institutional restriction and barriers on capital flow in the financial markets, impose strict disclosure requirements and ensure that investors can easily access to high quality and reliable information. Improving liquidity of capital markets can provide lower borrowing costs for investors and greater opportunities for investment diversification with lower systematic risks. In addition, equity market liberalization is important to help achieving market development. It can reduce cost of capital and increase capital productivity with better capital allocation. Conclusion 6.1 Short Summary In conclusion, as two main schools of thought in modern financial theories, there is a hot debate between efficient market hypothesis and behaviour finance. EMH asserts that financial markets are informationally efficient and equity stock prices instantaneously and fully reflect all known information. While behaviour finance argues that psychological biases lead to investor irrationality and limits to arbitrage impede exploitation of mispricing opportunities, so market is not efficient. There are wide empirical researches on the issue of market efficiency in emerging markets with mixed results. It is generally found that most of emerging markets are still inefficient, but after correcting for institutional characteristics and trading conditions, such as thin trading and the presence of non-linearity, some researches find that equity markets are efficient for some countries such as for Istanbul, Egypt and Jordan. When structure break factors are taken into account, market efficiency i s powerfully rejected for most emerging countries such as Argentina, Brazil, Greece and India. There are also some evidence shows that duo to economic liberalization policies, many emerging markets are moving towards more efficiency such as Estonian, Lithuanian and Russia. 6.2 Limitations of Empirical Researches and Proposed Further Research However, there are some limitations involved in these empirical researches. Some researches ignore whether the distribution is normal or not. Others using equally weighted indices may bias the results. The possible auto-correlation might be due to the noise traders but doesnt imply return predictability (Cuthberston, 1996). Most of these studies focus on the test of time series of equity return to investigate EMH, but don not investigate the momentum effect or the profitability of technical trading to earn abnormal return. Therefore, further research can be extended in several dimensions. Firstly, it suggests trying to combine the tests of momentum effect or technical trading rules with the time series tests to make more robust conclusions. Secondly, since most of researches focus on traditional EMH, it can consider the factors of investor behaviour, such as psychologies bias and limits to arbitrage to do further in-depth testing of EMH. Finally, further researches for more novel and accurate methodologies of testing EMH are significantly essential.

Thursday, September 19, 2019

Personal Narrative - Race :: Personal Narrative Essays

Personal Narrative- Race Wait. Be still. Don't go over the line. Don't let go. Wait for it. "BANG!" My reactions were precise as I sprung out of the blocks. The sun was beating down on my back as my feet clawed at the blistering, red turf. With every step I took, my toes sunk into the squishy, foul smelling surface, as my lungs grasped for air. Everything felt the way it should as I plunged toward my destination. I clutched the baton in my sweaty palms, promising myself not to let go. My long legs moved me as fast as I could go as I hugged the corner of the line like a little girl hugging her favorite teddy bear. The steps were just like I had practiced. As I came closer to my final steps, my stomach started twisting and my heart beat began to rise. The different colors of arrows started to pass under my feet, and I knew it was time. "Reach," I yelled to Susan, whom had seemed unusually far away. Yelling, "Slow down, slow down," turned into "Stop!" Susan halted to a stop as the gold baton fell into her hands and she took off into a dead sprint. The devil colored flag rose. We were disqualified from something that we all dreaded; going out of the exchange zone. I had never really been a part of a team that had a chance to win something, but the potential was always there. I finally got my chance to be a part of such a team my sophomore year of track. Mr. Jones, the head track coach, had decided to experiment with some different races to gain more team points. Since the girls' team lacked a medley relay, he placed Cindy, Kim, Susan and I in those spots. Cindy would run the 400, Kim would run the 200, and Susan and I would start the race off by each running the 100. We all had worked viciously to earn those spots by running off against our teammates. Going into the first race we had not expected much since Susan and I had never run this type of race. There were so many crucial things that we had to remember. It wasn't just to get out of the blocks and burn up the track; there was a baton involved, a certain amount of steps to take, and even a certain way to hold the baton.

Wednesday, September 18, 2019

Native American Essay -- essays research papers

From as early as the time of the early European settlers, Native Americans have suffered tremendously. Native Americans during the time of the early settlers where treated very badly. Europeans did what they wanted with the Native Americans, and when a group of Native Americans would stand up for themselves, the European would quickly put them down. The Native Americans bow and arrows where no match for the Europeans guns and cannon balls. When the Europeans guns didn’t work for the Europeans, the disease they bought killed the Native Americans even more effectively. In a poem by Louise Enrich called Dear John Wayne a line from a cowboy and Indian movie states the position of many European settlers in the Americas "Everything we see belongs to us". Native Americans did not like the way they were being treated. Every generation that passes, there would be fewer and fewer Native Americans around the Americas. Native Americans were dying like flies flying around bug spray mist. If it were not a war (The French and Indian war) that were killing them off it would be European disease (Cow and Small pox). The Native Americans saw what the Europeans were doing to their lives, they wanted their old way of life, and they wanted the Europeans to go away. In the movie Smoke Signals a line that was said by a character called Arnold Joseph represents the feelings of the Native Americans "Poof! The white people are gone". The Eur...

Tuesday, September 17, 2019

Mousetrap Car Essay

The purpose of this project is to determine the effect the size of an automobile’s wheel radius will have on that vehicle’s performance. To determine this, the distance a car travels when tested with the same propulsion force but different wheel diameter is measured. We expect that there will be an optimum size that should be utilized in order to achieve maximum efficiency. A larger or smaller wheel size should change the distance that the car will travel. The cars we will test will be made of common and inexpensive materials. The design of the cars will consist of simple wheel and axel setups and a lever; two simple machines that can be used to cause forward movement. The means of propulsion for our cars will be spring-loaded mousetrap with a length of string that connects to the axel supporting the wheels being tested. As the trap is set the lever will pull the line and thus rotate the axel causing movement. The size of the wheel should have a direct relationship with the distance that the car will travel. Small wheels will require more revolutions to move the same distance while large wheels will require more torque to make them begin to turn. The goal of the project is to find the most efficient use of the energy provided by the mousetrap for both speed and distance by adjusting the size of the wheel. A mousetrap car is a combination of two simple machines designed to operate much like a gas-powered car. However, a mousetrap is used instead of an internal combustion engine for the motor. The most common design involves positioning the mousetrap on the chassis of the cars and attaching an extended lever on the trap to one of the car’s axles by using a length of string. The end of the string on the mousetrap is tied to the arm of the trap while the opposite end is wound around the axle. When the mousetrap is â€Å"loaded,† potential energy is stored. The pulling force of the arm turns the potential energy into kinetic energy, causing the wheels to turn and boosting the vehicle. The mousetrap will provide a limited amount energy that the car can use as propulsion force that causes forward movement. The length of the string connecting the lever on the trap to the axel will remain constant through out the duration of the experiment. This will ensure that each of the wheel sizes will receive the same amount of energy. The wheels will also be made of the same material so that each will have the same traction, be about the same weight, and attach to the axel in a similar fashion. Since the radius is directly proportional to the circumference, larger diameter will obviously have larger circumferences. This is important because the circumference the part that actually touches the track. The larger the circumference of the wheel is as compared to the radius of the axel, the more mechanical advantage the wheel will have. Mechanical advantage is a phenomenon that increases the efficiency of a simple machine. Engineers try to design cars that make the most of this force when designing cars and other motor vehicles. A circumference of five inches will travel 25 inches in five revolutions while a circumference of three inches will travel only 15 inches with the same number of revolutions. The larger wheels seem to make more efficient use of the revolutions provided by the springing mousetrap. However the larger diameter also requires more energy to make them revolve. The energy required to turn an axel is known as torque. The more torque an engine (or a mousetrap) can provide, the faster the car will accelerate. Acceleration is also important to the efficiency of the mousetrap car. The faster a car can accelerate, the more momentum it can build up. Momentum is a force that keeps moving objects moving in the same general direction and force until some outside force acts upon the object. Momentum will conserve the energy from the mousetrap while providing thrust. If the wheels are too small, the axels will have to revolve more times to build up any significant momentum. If they are too large, they will require much more torque, which would reduce the amount of energy available to turn the axel once momentum is built up. Friction also plays a major role in the performance of mousetrap-powered cars. Friction between the car’s wheels and the surface it is traveling on is beneficial to the operation of the vehicle. This traction helps the wheels to propel the cars across further distances and at greater speeds. However, friction can also occur between the axles and the cars, which can be detrimental to performance. To combat this, lubricants are used on the axels where they are in contact with the chassis of the car. Also, more mass involved with the rotation of the axels will cause more friction. Therefore, heavier cars will be much less successful than vehicles using much lighter materials due to the amount of friction and inertia, which will not allow the car to travel as far or as fast under the same conditions. Methods The design used in the testing phases of the experiment consisted of thin pieces of plywood for the chassis and axel supports while 3/16-inch dowel rods were used for axels. The wheels were made of three sizes of circular pieces of foam board supported by a slice of a cardboard tube. A standard sized mousetrap was secured to the chassis and a 3-inch length of copper pipe was used to lengthen the lever to provide more mechanical advantage. A two-feet length of nylon string was secured to the copper pipe and the rear axel. The wheels were attached to the axels with rubber cement. The various larger sizes were designed to fit over the smallest ones that were attached to the axels. A single front wheel was used throughout the experiment Tests were ran to determine how far the car would travel and how fast they traveled a distance of five and feet. Each wheel size was tested three times and the results were then averaged: |Wheel size |Distance |Speed (5 feet/ 10 feet) | |2.25 inches |11 feet, four inches |1.45sec. / 2.4sec. | |4.75 inches |16 feet, 11 inches |2.1 sec. / 3.05 sec. | |7.00 inches |18 feet, two inches |3.6 sec. /4.42 sec. | Results Our results show two distinct characteristics. The larger wheels traveled a significant amount further than the smaller wheel sizes. However the smaller wheels were capable of quicker acceleration than the larger wheels. Since the wheels all had about the same amount of mass, the amount of friction did not increase of decrease enough to effect the results significantly. The wheel sizes could thus be adjusted depending upon the type of race the car was involved in; distance, in which the largest wheels would be used, or speed, in which the smallest wheels would be used. Experience in the design and function of the mousetrap cars would help us to design an even more efficient vehicle. Two layers of foam board would probably be used to cause the wheels to be more level and stable. Also, a longer lever would likely be attached to the existing lever on the mousetrap so that more advantage is achieved.