Inflation and investments.
Introduction Inflation is defined as a sustained increase in the general level of prices for goods and services. We measure it as an annual percentage increase. As inflation rises, every dollar you own buys a smaller percentage of a good or service (IEA,1972). The Fed tries to sustain an inflation rate of between 0-3%. Inflation affects different people in various ways. The impact inflation has on your portfolio depends on the type of investment you hold. There is now a widely-shared consensus, that high inflation does substantial damage to the economy, that moderate inflation does rather less damage, and that low inflation or price stability enables economies to work most effectively. With an open economy and low inflation bedded-in, it is necessary for investors to pay attention to real return from any investment, not nominal return (Alexander, Sharpe &Bailey, 2001). .my own home All investments have some level of risk, even money in the bank. The risk here is that although you are highly unlikely to lose funds, your capital can over time, be eroded through inflation. Inflation risk will undermine the performance of your investment. Therefore, it is important to establish investment strategies in a low inflationary environment for real return. Traditionally, investors believed that real estate is a good vehicle for hedging against inflation. Investing real estate would
assessing critical success factors for the adoption of computerised systems
Abstract In the modern society, there are more and more organizations consider using the computerized information system to help their work. This is because the system can not only increase the efficiency of a project or a particular work in process, but also the effectiveness. There are many companies now using the computerized system to maintain and even to create the competitive advantages. Certainly, there are some essential critical factors to help the companies adopt a computerized information system. This article emphasis on four factors which are top management support, the clear goal and objectives, the business process reengineering, project management and discuss comprehensively how the factors help to set up a successful computerized information system. Introduction With the development of science and technology, the information system has changed a lot. When facing the today's challenge business environment, it is important that a reliable system to manage the business. As well as the computer science has been familiar to officers and widely used, the computerized information system becomes more and more popular nowadays; although there is some security problems need to be solved such as the "hacks", there are still more companies which considering about using the computerized information system with their daily business affairs. Not only because the
Issues in Management Accounting AM 326.
Enrolment No.: 00054178 Tutor: Dave Hobbs Tutorial Group: Group 1 (Monday) George M. Zinkhan and F. Christian Zinkhan stated that since organization has limited resources, it is not possible to invest in all opportunities which are recognized or imagined. Once a set of promising project has been identified and investigated, it ought to reject some projects and invest in the others. Under this circumstance, the process of capital budgeting serves to structure the shape of the future of organization. However, the evidence drawn from prior capital budgeting case studies (e.g. Bower, 1972; March et al., 1988; Butler et al., 1993) shows that the strategic capital investment decision process is a complex, lengthy incremental process in which earlier activities and choices are crucial. Capital investment decision-making is not just an economy activity, it is also a political activity taking place within a wider context where groups and individuals have vested interests. Therefore a variety of capital budgeting methods have been proposed to assist manager who engaged in this important planning task. Alternatively, information such as tax policy, customer taste, competitor, technology, cash flow, environmental uncertainties, finance, interest rate, industry context, etc. are necessary to be considered in making decision in capital budgeting. There is no doubt that the
Recognition Position Paper
Recognition Position Paper Karen Bellinger, Nicole Elston, Ernesto Lembert, Wanda Manning University of Phoenix ACC/539 Accounting for Managerial Decision Making Mark E. Hall, CPA January 25, 2006 As a consulting firm we would like to express our recommendations for your company for recognizing revenues and expenses. Basically, the revenue recognition principle is one of the four main principles in the US generally accepted accounting principles. In addition, it is the main difference between cash basis accounting and accrual basis accounting. In cash basis accounting, revenues are recognized when cash is received regardless of when and how the services were performed or goods delivered. In accrual basis accounting revenues are recognized when they are realized and earned, regardless of when the cash is received. The general rule for the standard method are revenues are realized when goods and services are exchanged for cash or claims to cash (receivables). Revenues are realizable when assets received in exchange are readily convertible to known amounts of cash or claims to cash. Revenues are earned when the entity has performed its duties to be entitled to compensation. There are 4 main transactions of this kind: 1. Revenue from selling inventory is recognized at the date of sale (usually interpreted as the date of delivery). 2. Revenue from performing services is
Present a report which outlines and evaluates the main contributions Friedrich Von Hayek (1889-1992) made to our understanding of macro economics.
Macro Economics II Assignment Submitted to: John O Callaghan Submitted by: Ruth Lennon Student No.: 1061022 Present a report which outlines and evaluates the main contributions Friedrich Von Hayek (1889-1992) made to our understanding of macro economics. The Austrian born economist Friedrich Von Hayek presented some of the most influential theories on markets in the 20th century. As a defender of the free market and of classical liberal principles he believed that we must move away from a state-controlled or "planned" economy and towards a society based upon freedom of association and exchange according to the rule of law. He is credited as being the "most prodigious classical liberal scholar of this century" and has been described as the central pioneering figure in changing the course of economic thought in the twentieth century." (Thomas Sowell, 1995). Hayek was born in 1899 in Vienna into a family of intellectuals. After serving in the army of World War I, he studied and received doctorates in law, psychology and economics from the University of Vienna (1921-1923). It was at this time that the theories of the Austrian School of Economics were being formulated and refined by Eugen Boehm, Friedrich Wieser and Ludwig von Mises, all of whom were second generation Austrian Economists. The Austrian economists believed that their view could be distinguished to that
Analyse the performance of tax incentive schemes and to show how these schemes have increased the supply of property both in urban and rural areas in Ireland.
Contents Description Chapter No Page No's INTRODUCTION 1 3-4 MAIN BODY Section 23 2 6-7 Section 50 & LOTS 3 8-10 Owner Occupier 4 11-12 Tax Incentives and the supply of development land 5 13 Conclusion 6 14-15 APPENDICES Appendix 1 16 Appendix 2 17 Appendix 3 18 Appendix 4 19-20 BIBLIOGRAPHY 21 INTRODUCTION .0 Aims & Objectives Aim To analyse the performance of tax incentive schemes and to show how these schemes have increased the supply of property both in urban and rural areas in Ireland. Objectives * To introduce the reader to the selected topic and to clearly define the aims, objectives and research methodology of the project. * Show the particular relevance of this topic to the quantity surveying profession. * Discuss Section 23 and Section 50 tax incentives. * Discuss Owner-Occupier type relief and the Living Over The Shop Scheme (LOTS). * Show how the various tax incentives are calculated. * Tax incentives and the supply of development land. * Analyse the performance of tax incentives in the property market. * Conclusions and recommendations. Subject's relevance to quantity surveying profession The reports title 'meeting housing demand' offered our team a large number of topics to examine within the project scope. As a group we decided to tackle the issue from a national
Balance of Payments.
Balance of Payments ) The Balance of Payments is the resultant of all the goods (visible) and services (invisible) purchased and sold between the residents of the UK and the rest of the world. The transactions are calculated in to a sum called the balance of payments - this is calculated and should equal '0' - if not a small balancing amount is added. The country is defined a 'net lender to' or a 'net borrowing from' depending if there is more money (in terms of goods and services) going in or out of the country. If there is a deficit in the current account then this will mean that the UK is importing more than it is exporting to the rest of the world. Deficits lead to overseas debts, these debts increase with time because of interest. Even though debts are accumulated economic growth counteracts this as it is easier to combat overseas debt in time - as the debts can't grow faster than nominal income. There is a large income elasticity of demand for most imports as they usually are luxury goods - this means that if income decreases the demand for the products will decrease dramatically - also if income increases - the demand will also increase. One of the major affects on the current account is the exchange rate - making the exchange rate higher per $ will mean that it will be harder for exports to export - but easier for importers to import. Price elasticity of
Business Plan: Mobile Edge Advertising
Business Plan: Mobile Edge Advertising I. Table of Contents I. Table of Contents 4 II. Executive Summary 5 III. General Company Description 6 IV. Product Range 8 V. Marketing Plan 10 VI. Operational Plan 19 VII. Management and Organization 21 VIII. Startup Expenses and Capitalization 22 IX. Financial Plan 24 X. Appendices 30 II. Executive Summary Mobile Edge Advertising is an exciting new venture that seeks to capitalize on the emerging advertising market on mobile phone applications. We will design interactive applications that blend our clients brand image along with functional features. These features can range from simple expense calculators, to elaborate online ordering systems, and games. We believe that associating a clients brand with these functions will encourage downloads and multiple uses, providing a very effective advertising method. Companies such as Lexus, Coke-a-Cola, and Dominos have already expressed satisfaction in using apple apps as a form of advertising. In house development of applications can be extremely expensive, ranging from 10,000-100,000 euro for an application with a web interface. Our company's products will be far less complex and rely on the creation of basic templates for creating applications. As a result our costs will be significantly less and we will be able to target a section of the market who otherwise could not
efficient market hypothesis concept and its implications for investors
Itroduction This essay argues about the efficient market hypothesis concept and its implications for investors. First the concept of EMH is delivered. Next the ideas against EMH are put across. In the next paragraph different evidence for various types of efficiency are discussed. The next part focuses on the implications of EMH for both investors and financial management and finally a conclusion is presented. The concept of EMH The Efficient market Hypothesis (EMH) term appeared in the 1960's thanks to Eugene Fama (Beechey et al., 2000) He defined an efficient market as one that can quickly adjust to the new information. Twenty years later Fama had modified his definition by saying that the market is efficient if it incorporates all the information that is available, it means that efficient markets are acting rationally - relevant information is incorporated and there are no systematic errors made by investors. In 1968 Jensen noticed that the information access cost should be considered. He proposed a definition of a weak market efficiency according to which market reflects every information that influences it and which cost of access is lower that its maximum usefulness. There are three basic forms of market efficiency: weak, semi-strong and strong. Those types of efficiency describe the price changes as a response to diverse in their scope information sets. Information
Analyse investment potential of a negatively geared residential property in Sydney.
Negative Gearing Assignment Prepared by: Sanjeev BHAKRI EXECUTIVE SUMMARY 4 2 INTRODUCTION 5 2.1 Objective 5 3 ANALYSIS OF INVESTMENT 5 3.1 Location 5 3.2 Physical Attributes 5 3.3 Legal Issues 5 3.4 Rental Prospect 6 3.5 Growth Prospects 6 3.6 Economic Trends 8 3.7 Political and Legislative factors 8 3.8 Demographic Factors 9 4 NEGATIVE GEARING 9 5 FINANCIAL ANALYSIS 10 5.1 Borrowing expenses 10 5.2 Rental expenses 10 5.3 Body corporate fees and charges 11 5.4 Depreciation Costs 12 5.5 Rental Returns 12 5.6 Sensitivity Analysis 13 6 SUMMARY OF FINDINGS 14 APPENDIX A 15 APPENDIX B 16 APPENDIX C 17 EXECUTIVE SUMMARY 2 INTRODUCTION 2.1 Objective The main objectives of this report are to analyse investment potential of a negatively geared residential property in Sydney. It will look into impact of various factors on the success of the investment. 3 ANALYSIS OF INVESTMENT 3.1 Location Good location of property is very critical for it's success as a good investment potential. "Location, location, location," is a common and almost hackneyed phrase in real estate literature. Mostly, "location" is repeated to emphasize that it is extremely important to the resale value of your home. Specially for an investment property which should attract potential tenants for lease and large number of potential future home buyers. A careful choice of location can