Plato on Harm

Plato on Harm




Plato on Harm

Harm based on Plato’s view is a negative action that affects another party or thing in a harmful manner. Harm can be related to the moral and ethical principles of beneficence. Harm is seen as an opposite of the principles of beneficence in that the latter refers to actions of charity, kindness, and mercy. Plato noted that harm, with regard to other people, resulted in decline in their respective human excellence. On harming others, one robs them of their exceptional qualities and gives them negative ideals.

The provided by Plato is seen as appropriate as it resonates from the concepts of justice and beneficence. It is clear that justice is a basic component of human excellence, which is negated by harm. Committing harm against an individual goes against justice and principles of beneficence. In arguments by Socrates, he noted that the primary aim of humanity was not life, but living a good life. Living a good life should mean that people abide by the basic principle aspects of justice. In addition, he adds, that harm is not a component of justice irrespective of harming someone being a utilitarian action.

Socrates in response to Plato’s claims noted that when individuals are harmed the decline in their respective human virtue and values. Thus, justice being an integral human virtue does not consist of human virtues. In addition, he also noted that harm makes people “worse”. It results in corruption of their justice virtues and in the process, they become unjust. In addition, Socrates noted in his reply that only unjust people were able to corrupt the good and make them harmful towards others.

In addition, it also important to note of the contributions made by Polemarchus in regard to the concept of justice as raised by Plato and the responses given by Socrates. Polemarchus claims “”justice is to benefit one’s friends and harm one’s enemies”. This can be seen in a variety of common social aspects such as war, politics and in social relationships. The arguments engaged by the three parties resulted in questions over what is right and more so the definition of justice with accuracy. Plato questioned Polemarchus’ claims that justice was doing what was favorable to him and his friend by harming the enemies. He asked if the definition of friends was those an individual believes are helpful and important in life. He explicitly notes that harming enemies of one’s friends results in express deterioration of the excellence of such entities. It deprives them their human excellence and thus corrupts their just nature resulting in unjust men.

It is noted that it is never a function of heat to ensure cooling of things. From such a perspective, it is recognized that it is not a function of a just human being to harm another. Hence, it is impossible for a just man to consider or event act in harming his enemies or those of his friends, and family. This is because a wise man is incapable to considering such falsehood. Thrasymachus contradicted Socrates and Plato by noting that a just man wields power. Justice is seemingly an advantage of the stronger parties in society.

In addition, he also noted that justice was similar in terms of concept and virtue around the world and is only a preserve of the advantaged and strong in society. He illustrates his point by noting that the strong and advantaged in society such as lawmakers usually develop laws that serve their primary interests. From the perspective provided by Plato and arguments with some of his associates, it is evident that justice has varied connotations. It is understood as a virtue relative to human excellence as well as a position held by the strong and advantaged in society. This affirms that justice is a central view held by a majority in terms of what is right and wrong. In addition, it is a virtue of human excellence, which can be corrupted with ease in the event that one engages with unjust and immoral or unethical parties.



Online Midterm Exam





Online Midterm Exam

Part 1

The art is titled “The Marriage of Shiva & Parvati” and was produced between the 10th and 11th century to an unknown, most likely Hindu, artist. Similarly, it is based on the classical style of art that depicts antique symbols in a western tradition dating back to many decades ago. Moreover, it makes use of sandstone.

Part 2

The artwork focuses on the idea of love and the process of acquiring it from the opposite sex. In particular, Shiva is made a widower by the death of his first wife. However, the gods meet and decide to send him a reincarnate version of her who ends up being much more beautiful. As such, the sculpture is a reflection of the joy that engulfs people and its power to forge lasting friendships between complete strangers. The nature of sexual appeal is also daring due to the presentation of naked parts of the body thereby illustrating a form of modernity in which populations had begun to embrace sexuality. Additionally, the inclusion of an equal number of gods on either side of Shiva and Parvati shows the acknowledgement of gender equality and the contribution that the female gender plays in the development of the society. Likewise, the artist uses vertical lines to portray subtle emotions such as tension thereby offering a contrast to the celebratory mood. Horizontal lines are drawn as well in parallel with the objects thereby achieving an aesthetic harmony. Moreover, the piece is well lit due to the evenness of the objects that makes them less distracting. It is made from a brownish color that helps in the maintenance of the natural theme. Therefore, it shows that love is an expression of true feelings and is meant to be eternal. Their faces are beaming as well, and that is used to provide viewers with hope. Consequently, such a narrative asserts the benefits of being optimistic as that would lead to a better quality lifestyle.

Part 3

The above artwork is significant because it acts as a tribute to the gods especially Indra and Vasudeva. Such individuals were revered in the Buddhist community hence indicate the benefits of aligning oneself with them. In addition, it is a good indicator of the lifestyle of people during medieval times thereby being an archive of human evolution. Moreover, its incorporation of Asian architecture helps to diversify its audience while being informative of its heritage. Culturally, its finishing is sophisticated, and that implies that the inhabitants of the time were highly skilled as well.

Part 4

The use of animal objects symbolizes their complimentary nature with humans. For example, the inclusion of the cobra is meant to underscore the energy that can suffice when an individual awakens certain emotions. Furthermore, the serpent is meant to create more texture thus improving the aesthetic beauty of the sculpture. Moreover, the artist uses curvy lines to build an impression of continuous motion. By so doing, the art appears interactive since it becomes appealing to the viewer. Likewise, the use of a black background is vital in creating a color contrast, which highlights the symbols on display more easily. As such, audiences undergo less strain while observing the artwork. Contours and boundaries are well carved with smooth finishes thereby making the details conspicuous in order to highlight the different genders, as well as themes. In fact, the engraving is so precise that the images are realistic hence achieving the intended purpose.


















Use of Space in Christo and Jeanne-Claude Projects





Use of Space in Christo and Jeanne-Claude Projects

The Christo and Jeanne-Claude Projects refer to a string of environmental artistic projects undertaken by the team of Hristo Vladimirov Yavachev and his wife, Jeanne-Claude Denat de Guillebon. The couple has received a lot of popularity because of their visually impressive and extravagant artistic creations. Part of their recognition also originates from the controversial way in which they remove their artwork after displaying it for a specific duration. After being displayed, all of their works of art are destroyed and recycled. The Gates is one of the artworks in the Christo and Jeanne-Claude projects that consisted of approximately 7.500 vinyl “gates” on a 38-kilometer stretch in New York City. The erection of The Gates elicited mixed reactions from the residents, art lovers, and tourists. A section of them reported that it improved the winter landscape while another group argued that they defaced the city.

The use of space in the placement and construction of The Gate is a very interesting artistic aspect. It was constructed on the Central Park for two main reasons: it was isolated from natural forms and it was located in the middle of a developed city. This isolation is an important aspect since it represented an unused space. In a way, the park could even be considered neglected or misused. Jeanne and Christo sought to initiate a set of activities and materials that could activate the banal space that was Central Park. The two artists particularly focused on exploring inner spaces as opposed to the conventional outers paces addressed by a myriad of artists. The proposal of The Gates paved the way for the “inner space” concept in the 19th century.

The public platform is from the precise conditions that people use, the very public spaces or those owned privately, the state that is a large number of people. It is space utilized by the millions of citizens who go through that space for a very short duration. Jeanne and Christo worked to insert a slight interruption in that space. Consequently, the public takes up everything belonging to the space; they do not invent it. The time factor is a very dominant aspect of The Gates. Jeanne and Christo were very strict on the duration that all their artwork took while in the public domain. In fact, The Umbrellas were the longest standing work of art by the couple. In describing the process of assembling The Gates, the couple stated that speed was the biggest priority. All the gates were attached to a heavy steel base using bolts after which the cover is opened and the fabric is loosened. This rapid process of assembly and deconstruction serves to introduce an element of intrigue, value, and flexibility. The allure is created by the speed. The public notice a certain construction work ongoing, a brief announcement of the display and even before most of the visitors can explore The Gates; it has been demolished and recycled. Furthermore, the authors also make no claim of ownership and this prevents the public from accessing any archived version.

The relationship between space and time is a very close one. When Jeanne and Christo sought out to assemble The Gates, it transformed an idle space into one teeming with interest and creativity. However, without realizing it, the two artists had influence the time aspect. The Gates came up in a location that was considered dead and empty into a valuable place. Now, when people traveled through the park, the aspect of time became irrelevant since something new was included.

Influence of Social Media

Influence of Social Media





Influence of Social Media

A survey was conducted among 50 Australian students studying in the American University of Sharjah on their exposure to social media. By having an equal number of boys and girls participating, the gender parity provided an excellent opportunity to measure its reach on a wide audience thereby acting as a reflection of the rest of the young population. Most respondents confessed to using social media to communicate more with their friends rather than family members. Notably, there was a marked preference of making friendships with people of the opposite sex. Therefore, few people showed an interest in same-sex friendships. Moreover, it was apparent that individuals are attracted to people with similar interests as they are able to exchange ideas on a number of issues. The sharing of photos and stories was more prevalent than music and movies because of the ease of uploading such items. In fact, while other devices such as computers are used to some extent, a majority of them attested to using cell phones hence illustrating its usefulness and popularity among this demographic.

Similarly, a fewer number confirmed using it for entertainment hence asserting the platform’s goal of facilitating interactions. Furthermore, a significant portion of the survey team alluded to using it for educational purposes in which they form online groups for carrying out group discussions. While this is an encouraging prospect, it is a rarity because most of them prefer to use this forum to make personal connections with other users thereby signaling its power of linking strangers. All the respondents claimed to present their ideas without fear thus indicating that social media provides some kind of liberation in which freedom of expression is propagated. As opposed to face-to-face communication, this gesture makes such avenues vital in making people to expose their vulnerabilities especially when speaking about sensitive subjects. All respondents were in agreement as well that online accounts are effective in the mass mobilization of people into action in support of a specific cause. In particular, they noted that Facebook played the biggest role in the 2011 Egyptian uprising. As such, the availability of the internet in most countries and ease of joining social media platforms makes it possible to reach a large audience within a short period. Moreover, the students were delighted with the anonymity of such arenas as they can be used to conduct whistle blowing activities which can then spur people into action. However, it was observed that most of them stuck to their identities even when communicating with strangers thus unraveling the media’s power to influence cultural integration.

Likewise, the number of people who post comments on blogs and those that don’t was even. Therefore, it shows the uptake of this trend in some quarters and the unresponsiveness in others. Such a scenario can be attributed to the need for having particular interest in a subject since blogs are dedicated to certain aspects of life. A majority of them also confessed to social media being a distraction from studies due to the numerous fascinating options available online. In fact, its accessibility through cell phones makes users glued to their devices both day and night hence spending a lot of time chatting instead of studying. Nevertheless, the students were equivocal that such forums can be used to ruin a person’s reputation and exposes them to harassment. In particular, girls were strongly in favor of this notion. Such skewed results display the unfair treatment of online female users against their male counterparts because the former are always victims of online abuse. For example, they are more likely to be tormented about their appearances. Therefore, this cyber bullying is destructive and the invasion of privacy is troubling.

Furthermore, many of them confessed to spending more than six hours per day on social media sites. Such behavior indicates the overwhelming nature of these services as they are sources of economic, personal as well as political views. While most world news is easily streamed through television and online websites, this group of students acknowledged that they receive such information from sites such as Facebook and Twitter. By so doing, they are concurring with the common belief in the instant dissemination of news to a mass market that is only applicable to such platforms. Moreover, it is a testament to the constant usage of social media since thousands of users are online at any given time. The survey also discovered that freshmen were less likely to strike conversations with strangers. It is a phenomenon that can be attributed to the initial culture shock as well as timidity that engulfs such students when they join college. Most of them find themselves in a new environment and are exposed to a different culture thus develop skepticism towards things that they are unfamiliar with in hope of maturing quickly to embrace them later. However, social media was credited with being able to reach many people while the invasion of privacy was noted to be its main disadvantage.






















In choosing my thesis, I was more focused on the difficulties that Christians face in their walk of faith. They have a desire to follow God’s principles and live according to His word. They try to do what is right in the sight of God. However, their carnal desires often act in opposition of what they would wish and they end up sinning. The law and sin are such complex elements in the life of a Christian although they may not seem to be so. Christians struggle to eliminate sin and follow the law. Despite the complexities of the law, it remains one of the most fundamental elements in a person’s life because it makes him aware of his shortcomings. People cannot be aware of sin if they did not have the law. Hence, even though people end up committing sin when they break the law, they cannot live without the law because it acts as a guideline in terms of controlling people’s desire for sin.

I begin by introducing the passage based on both the primary biblical text and on the secondary information that I have gathered. This allows me to have a clear direction concerning the rest of the paper. The introduction enables me to limit my focus on a particular issue contained in the passage. The use of secondary sources in this section is important in enhancing the understanding of the biblical text. Getting the viewpoints of others enables me to proceed since I am sure that I am proceeding in the right direction. I follow this up by looking at the passage more deeply. This requires more insight from other scholars. For instance, I am able to note that the passage has two sections of divergence. The first section observes the heavy burden that Christians have to bear while the second section dwells on a person’s effort to do good and live right.

In the process of analysis, I discover that it is important to consider some words carefully so that I can understand the message fully. For instance, I discovered that in this text, Paul has chosen to include himself in the discussion. He is not just telling the readers to follow the advice that he gives them. Instead, he includes himself in the discussion by writing in first person. I follow this by including more information concerning the law and sin as it pertains to Christian life. I then give an example independent of the biblical passage and the secondary sources consulted, which aims to show my understanding of the text

I consulted numerous publications when writing the information. Reading the passage using different interpretations enabled me to have a clearer and deeper understanding of the text. I reflected on what the text meant before deciding to consult other sources. By doing this, I made sure that I was able to form my own opinion first before researching the text through other sources. The decision to use the scholarly sources was based on the need of ensuring that the information I gathered was reliable and credible. I consulted numerous materials for this task.

I consulted sources that included views from both the old and the New Testament. This is because the law is originally contained in the Old Testament. The sources consulted include different interpretations of the biblical passage. However, they do not differ in meaning. I source for information from other sources including Novum Testamentum, Grace Theological Report, Tyndale Bulletin, and Bibliotheca Sacra.



Barnett, Paul. The Second Epistle to the Corinthians. Grand Rapids, MI: W.B. Eerdmans Pub, 1997.

Chang, H. K. The Christian Life in a Dialectical Tension? Romans 7:7-25 Reconsidered. Novan Testamentum. 49. 2007. 257-280.

Dockery, D. S. Romans 7: 14-25: Pauline Tension in the Christian Life. Grace Theological Report. 2.2. 1981. 239-257.

Hart, J. F. Paul as Weak in Faith in Romans 7:7-25. Bibliotheca Sacra. 170. 2013. 315-343.

Kuula, Kari. The Law, the Covenant, and God’s Plan Volume 2. Volume 2. [Helsinki]: Finnish Exegetical Society, 2003.

Porter, E. S. The Pauline Concept of Original Sin in the Light of Rabbinic Background. Tyndale Bulletin. 41. 1. 2004. 3-30.

Starling, David Ian. Not My People Gentiles as Exiles in Pauline Hermeneutics. Berlin: De Gruyter, 2011.


NHS Strategic Plan and Organizational Structure


NHS Strategic Plan and Organizational Structure




NHS Strategic Plan and Organizational Structure

Strategic planning is meant to ensure changes that will revolutionize the organization are achievable and lays out guidelines that will ensure its ramifications are both permanent and positive. An in-depth comprehension of the desired result and the guidelines to be followed for successful implementation is essential. Structure occurs innately in every organization. It details the framework that edifies the group by facilitating the election of leaders who chart the course of the plan (Swayne, Duncan, & Ginter, 2012). A case study of the National Health Service (NHS) in England gives insight on the characteristics of a successful strategic plan for a health organization.

NHS mission is to ensure healthcare with high standards is available to all those who need it. Their vision is a nation that is well informed on their healthcare mandate and has the capacity to fulfill it leading to an increase in longevity of its beneficiaries. Their purpose is to create a favorable environment where the staff will perform optimally, and resources will be efficiently utilized in order to get the best results. The organization’s key values are compassion, enhancing lives, cooperation for patients sake, valuing people, commitment to high standards of healthcare, respect, and dignity (Talbot-Smith, Pollock, Leys, & McNally, 2006). NHS strategic plan model demands that patients take precedence over all things and reemphasizes the commitment towards promoting equitable, quality care to the public. The model helps the patient to participate in decisions pertaining to their health care and developments in NHS. This goes in line with the organization’s vision to increase individual’s control over their health and reaffirms the NHS core values that everyone counts. Maintenance of quality healthcare is another value that concurs with the NHS strategic plan model.

NHS uses the change theoretical framework. At core of this concept, is change through effective leadership. The leader should inspire commitment among its subordinates to a shared purpose subsequently generating collaboration. As NHS is a large healthcare organization, it has a complex organizational structure. It is made up of many sub-branches with their management boards and fiscal budgets; the intervention of the headquarters is limited to major decisions and funding. The national directors seat at the helm at the England board and there are semi-annual meetings where they are briefed on any development (Talbot-Smith, Pollock, Leys, & McNally, 2006). There are also policies, operations, finance, medical and human resource directorates, which complement each other’s efforts. The leaders serving in the NHS England Board are non-executive directors Professor Sir Malcolm Grant CBE, who is the chair, among other non-executive directors. On the executive side, Simon Stevens is the chief executive director.

NHS has a diverse service portfolio ranging from NHS counter fraud services to NHS supply chain management. Their main strategic theme is high-quality services that meet the clients’ criterion. NHS dental services are part of its clinical programs. The target market is the public not exclusively to NHS subscribers. The supply chain is intermittently outsourced to external providers. This outsourcing is geared towards ensuring the provision of quality products and services as dictated by the firm’s core values. Tenders are awarded to the most qualified professionals in their respective fields. NHS supply chain promotes the organization’s involvement in community development projects. This is seen through the NHS student bursaries, one of the NHS service portfolios, cooperation with the Department of education to assist underprivileged individuals (Light, 2008). The organization utilizes the value chain to implement its strategic plan.



Light, D. W. (2008). Will the NHS strategic plan benefit patients?. BMJ, 337.

Swayne, L. E., Duncan, W. J., & Ginter, P. M. (2012). Strategic management of health care organizations. John Wiley & Sons.

Talbot-Smith, A., Pollock, A., Leys, C., & McNally, N. (2006). The new NHS: A guide. London: Routledge.


International Business

International Business




International Business


The modern day business market is dynamic having significant levels of uncertainty concerning future conditions and state. This factor necessitates expanding companies to develop effective strategies that conform to their managerial vision. Decision making in the development of a strategic plan is complex therefore requiring in depth analysis of the expanding market prior to entry. In detail, this paper analyses and explores various international markets that are driven by expansion in order to discern the best location for the U.S.A based toy manufacturer to expand. In addition, the report will provide market expansion methods for the company to ascertain successful market entry. A socio-cultural analysis will be made in order to identify the best cultural approaches that will ensure the toy manufacturer effectively co-exists with the immediate social environment.


Strategizing to a company in the progressive and dynamic economic market characterized by the globalization concept is a complex undertaking. The market is always changing, having interconnected variables and distinct policies that make the business environment an explosion of knowledge. The high degree of uncertainty and change in new markets is a problem that organizations consider prior to entry. The modern market and concept of globalization requires corporation between different legal systems, co-operate structures, borders and cultures. Companies that aim to expand have to possess high degrees of flexibility and conformance to the dissimilar markets in order to thrive. Despite globalization necessitating standardization in different t markets, the world remains to be divergent. International markets have equal degrees of conformance and dissimilarities in their business market presenting different opportunities and threats for new companies. Internationally operating businesses require the ability to adjust to the evolving environments that they encounter in the various points of our globe.

P.E.S.T.E.L Reports


Political Analysis: Germany is a federal republic and legislative authority vested in their parliament, which is known as the Bundestag (Mennen, 2011). The country is made up of a centralized federal government divided into sixteen federal states. Following their 1949 constitution, none of the sixteen stases can develop a government of their own (Mennen, 2011). Germany has three power ranks that are the Head of State (President), Head of Government (Chancellor) and the Cabinet. Germany is a member of the G8, G20, World Bank and the International Monetary Bank (Mennen, 2011). It is one of the most stable political systems in the world.

Economy: The country has enjoyed a stable growth rate of 0.7% from 2008 translating in 3.6777 trillion dollars annually plus compound generation (Mennen, 2011). Germany is a social market economy and the biggest European market. Germany is the world’s second exporter having 1.41 trillion dollars generated in 2011 (Mennen, 2011). Exports account for a third of the gross domestic product. The main products are of engineering, technical, and chemical natures. It is the leading manufacturer of wind and solar powered technology. The nation imports two thirds of its energy requirements. The service industry is its leading GDP generating sector followed by industry and agriculture.

Social Analysis: Germany has a population of 82 million with a growth rate of -0.061%. The birth rate is 8.21 per 1000 persons with a life expectancy of 79 years (Mennen, 2011). It is the second most populous country in Europe with a population density of 230 persons per square kilometer. Persons between 15-64 years make the biggest chunk of the population representing 66% of it. Labor works for 37 hours weekly between 9am and 5pm with an annual leave of 20-30 days. Germans ignore discounts and prefer quality, comfort, safety, and reliability in products.

Technology: Germany is one of the global leaders when it comes to engineering. It is the leading automobile producer. It is the eighth out of 139 countries technology wise according to the World Economic Forum report of 2010 on Global Competitiveness (Mennen, 2011). The WEF ranks Germany third on innovations using number of patents filed annually. Technology research accounts for 2% of the country’s expenditure.

Environment: Germany is the sixth carbon emitter in the world. After the Kyoto Protocol, emission reduced by 23% through use of wind energy (39%) for production (Mennen, 2011). Germany has reduced its energy consumption by 27% since the Kyoto Protocol. It is invested heavily in the transformation to renewable energy.

Legal: Law is enforced in three fronts that are Federal, State and local in order of supremacy. The Supreme Court is accountable for enforcing rights and justice preservation. Germany follows Roman law where administration of Justice is divided into five branches that are Ordinary, Labor, Administrative, Social, and Financial Courts (Mennen, 2011). Investors put the legal system of Germany second after Britain worldwide.


Political Analysis: Brazil relies on monetary policies when it comes to business. Interest rate value is set at an average of 10.5% to benefit consumers (Lukac, 2008). The political system is focused detrimentally on the consumer thus has a negative outlook for companies operating on a short-term basis. Inflation remains to be the biggest challenge in Brazil because of the domestic energy consumption rate and global oil prices. After inflation, corruption is the second political concern. Corruption has resulted in lack of government contracts thus new entrants bribe in order to gain approval.

Economics: As of 2011, the country’s GDP was 2.52 trillion dollars (Lukac, 2008). Exports, the leading GDP generator accounted for 201.9 billion dollars (Lukac, 2008). Main exports are iron ore, manufactured items, coffee, and other agricultural produce. Imports account for less than a third of the country’s expenditure. According to ranking done by the Foreign Direct Investment (FDI), Brazil has a score of 8 out of 10 (Lukac, 2008). The score reflects the country’s economic risk, stability, business, and investment ambiance. The service industry accounts for 64% of the GDP followed by Industry (28%) and Agriculture (8%) (Lukac, 2008).

Social Analysis: The most dominant class is the middle class eating up of 50% of the population. 20% of the population is illiterate thus; foreign investors discourage investing in Brazil. The population of Brazil is three times that of Germany. The population growth rate for the country is 0.31% (Lukac, 2008).

Technology: The country spends 1% of its GDP on research and development (Lukac, 2008). Intercommunication and global communication factions remain the central focus of technology in the country. Brazil has the highest rate of patent application in South America (Lukac, 2008). The country has a technological agreement with European countries for scientific and technological co-operation in order to elevate accessibility of technology information.

Environment: Brazil compels companies to install eco-friendly combustion techniques in product development. There is a signed pact with border nations to develop the Amazon basin. The Amazon is the centre focus thus emphasis is put on reducing deforestation and human settlement around the basin. The country ranks sixth according to the Kyoto protocol regarding emission of green House Gases (Lukac, 2008).

Legal: the Civil Code governs Brazil when it comes to business. New entrants in Brazil register with the Trend Board as separate legal personalities (Lukac, 2008). Creditors cannot seize partner assets in order to reimburse company debts. The legal system is strict on foreign investment giving minority participation in media, financial bodies, insurance, and health. The minority participation is also placed on foreign individuals. Taxes vary from state to state, elevating compliance and complexity expenses.


Political Analysis: China follows the Rule of Law established in 1982. There are 300 laws regulating economic functionality in the country (Tian, 2007). China is a one party communist country marked by dictatorship. Economic management powers in the country are decentralized increasing complexity costs for foreign investors (Tian, 2007). The political environment of China favors foreign investment through soft policies on distribution channels and market expansion.

Economics: China is the second largest economy after the United States with predictions having it surpass the leader by 2020 (Tian, 2007). As of 2011, the GDP was at 30 trillion dollars. The country has maintained a growth rate of 9.5% in the last decade. Chinese exports account for 10% of the globe’s total exports (Tian, 2007). The consumer price index for China rises at a stable rate of 4% benefiting foreign investors who effectively expand in the market. The biggest resource for China is its labor force. China’s big population provides an abundant labor force for both foreign and local investors in manufacturing industries.

Social Analysis: China is the most populous country in the world with over 1.3 billion persons and a growth rate of 0.494% (Tian, 2007). The IMF considers China as a high context society keenly focused on family and community ties. In this, foreign investors require strong private relationships with key stakeholders in order to overcome the blood and racial ties in China. This makes it time consuming and costly for foreign investors. Corruption is another problematic social issue in China. The Corruption Perception Index places China at 72 out of 179 nations (Tian, 2007). Given the economic size of the country, the ranking does not entirely reflect the expense in damage caused by corruption. Foreign investors experience huge losses in the country more than in other countries ranked ahead of it by the CPI.

Technology: The growth rate of technology in China is rapid. This is because of governmental emphasis on innovation through funding, reform, and programs. Technology has helped the country cut 21% of its production costs in the last decade (Tian, 2007). Focus is put on biotechnology and information systems because of the country’s reliance on agriculture and engineering. The country has a technology agreement with the United States that includes sixty protocols. China invests 3.5 billion dollars annually on research and development.

Environment: The rapid population and industrial growth rate in China has numerous adverse effects on the environment. As of 2007, China was the world’s biggest carbon gases emitter (Tian, 2007). According to the World trade Organizations, seven of the ten most polluted cities were in China. All rivers in China are water polluted to some degree with half the population lacking access to clean water. This makes water scarcity the biggest environment concern for foreign investors. The environmental legislation has imposed high operational taxes for manufacturers in attempts to mitigate the adverse effects of production.

Legal: Chinese laws support foreign investors. There is an established law on foreign equity that rules and regulates on operational commencement, termination, and liquidation of foreign-based organizations. Foreign investment is protected and supported by three laws. These are the Chinese-Foreign Equity Joint Ventures, Chinese-Foreign Contractual Joint Ventures and Law on Foreign Owned Enterprises (Tian, 2007). China is known for its attractive taxation package for foreign enterprises in Asia. Tax incentives in the manufacturing sector are given in promotion of foreign investment.

Country Selection

The country selected for market expansion for the Toy manufacturer is China. The current opportunities in the nation present numerous spaces for foreign investment that the company can tap into successfully. For instance, the Chinese government focuses on internal growth thus continues to implement positive economic policies and modifications of its economic structure to ascertain growth (Knight & Ding, 2009). China has been undergoing a reform period that is highly beneficial to both local and foreign investors. The country has a fixed rate of GDP growth that runs over a ten-year period proving its political and economic stability (Knight & Ding, 2009). These mark its political climate.

Economically, China within the framework of the competitive market is highly profitable. The rate of return of capital is high because of low labor costs in the initial production investment and high sale numbers (Knight & Ding, 2009). The Chinese population offers a readily available labor force that the Toy manufacturing company can use. The capital- labor ratio is out of equilibrium making the rate of investment return big (Knight & Ding, 2009). Integrating the local people in the company creates a good image for the company that in turn reflects in sales. Equally, the large population offers a big market in children for the manufactured toys. Moreover, the large children population is a big enough space for all competitors in the toy business. China has an abundance of production resources in the form of labor and energy. Abundance results in low costs of acquiring the resources that in turn reflects in low production costs.

The WTO argues that Chinese investors have grown in confidence with their legal system since the early 1990s. This is because of the various legal reforms that have been put in place in alignment with economic and political reforms (Knight & Ding, 2009). The present legal system is adequate in resolving disputes and conflicts in the market. Decentralization of the legal system provides an in-depth analysis of cases in timely fashion allowing business continuity (Knight & Ding, 2009). Improvements in the legal system result in an indirect proportional change in the rate of corruption. As the system improves, corruption decreases in China.

Demerits of investing in China arise from its living conditions. Water scarcity and high carbon emissions create a hostile environment for foreign workers (Knight & Ding, 2009). The polluted environment may result in ill health conditions and living hardships that necessitate the company to offer hardship allowances in order to lure international employees. The extra salary incentives increase the production costs of the company.

Mode of Expansion

The recommended mode of expansion is franchising. Franchising is a form of partnership where goods and services are marketed and distributed by secondary parties other than the manufacturer with the original trademark (Sahay & Sharma, 2008). Franchising is an ever-growing method that gives the consumer the notion that the provider of the goods and services belongs to a group or chain of the original maker. In detail, franchising is a written contract that grants a party the right to engage in service delivery, sales, or distribution under the marketing plan or system developed by the franchisor. The operations of the franchising process employ the trademark, trade name, service mark, logotype and any other symbol associated with the franchisor and its affiliates (Sahay & Sharma, 2008). There are various legal exemptions dependent on the type of franchising undertaken that both the franchisor and franchisee need to be coherent with prior to contract commencement.

There are numerous reasons as to why to franchise. For one, in applying the energy and resources of the motivated operator, the expansion process occurs in a faster way (Sahay & Sharma, 2008). This can allow the Toy manufacturer to access market opportunities that have a time constraint. Local operators that act as marketers and distributors have greater knowledge of their local market than foreign investors do. Local operators have easy access to resources and understand the legal and political niches of the market that they can manipulate to their advantage. In short, local operators are more effective than foreign companies in the local market are. Franchising increases the flexibility of the original company giving it a competitive positioning in regards to future and present conditions.

The biggest fear in franchising is the loss of quality control (Sahay & Sharma, 2008). Secondary operators in the contract function under the trademark of the original firm thus can destroy or tarnish their goodwill given that they operate in poor ways. Quality control is ascertained in the trade agreement that gives the franchisor enforcement rights in incidences that the franchisee steers off from the set business plan. This is part of the trade off in the application of the franchisee’s resources in order to expand one’s business.

Cultural Challenges

The Toy manufacturer will be operating in two different environments that will create conflicts in relation to degrees of cultural adaptations. Communication and organizational structural differences are the major challenges facing the expanding company (Sahay & Sharma, 2008). The two are linked ideologies as communication practices affect culture and the opposite applies. Language barriers will exhibit the cultural differences affecting operational coherence and effective functionality (Sahay & Sharma, 2008). The USA converses in English while China communicates in Chinese. In addition, there is dissimilarity in communication practices such as signs, symbols, and gestures. Individuals from different backgrounds communicate in dissimilar manners thus creating communication, commitment and functioning issues in employees.

In order to understand the cultural differences, the Toy manufacturer must devise a way to highlight the similarities and divergence in the two environments. Understanding is done on two fronts that are the context in communication and the beliefs attached within the context (Sahay & Sharma, 2008). The two concepts are used in the elevation of understanding in intercultural communication. The study on cultural divergence is done prior contract commencement with partners in order to increase the level of effectiveness in the trade agreement. Study is done jointly to equally improve operations, cohesion, and relations. In order to eliminate employee conflict arising from poor communication, workers are taken for training immediately after recruitment (Sahay & Sharma, 2008). Training establishes a standard communication practice that considers both cultures. In addition, training solves the problem in the language barrier as foreigners are taught of the local language and vice versa.


Companies that attempt to seize the opportunities of a new business market for growth are faced with complex and significant decisions regarding mode of entry and managerial expenses. The company needs to understand the business climate of the foreign business environment in order to identify the best model for expansion. Modes are divergent in terms of control, resources, legal conformance and technology associated risks. The Toy manufacture company is one that targets children. Of the three target markets, China has the biggest child market. In addition, the political, economic, and legal environment of the country provides the optimum conditions for expansion. Socio-cultural and sociopolitical challenges in language barriers, access to resources and corruption direct the company to franchising as the ideal expansion model. Franchising provides the best model for growth with lowest degrees of risk and highest legal and operational conformance.



Knight, John & Ding Sai. (2009). Why Does China Invest So Much? Oxford Department of Economics Discussion Paper. 441. 3. 1-38.

Lukac, D. (2008). Key Success Factors for Foreign Direct Investment (FDI): The Case of FDI in Western Balkan. Diplomica Verlag.

Mennen, M. (2011). Strategic Analysis of the BBC. München: GRIN Verlag GmbH.

Sahay, A., & Sharma, V. (2008). Entrepreneurship and new venture creation. New Delhi: Excel books.

Tian, X. (2007). Managing international business in China. Cambridge: Cambridge University Press.


Human v. Divine





Human v. Divine


Greek mythology is filled with several accounts of the inclusion of gods in the daily activities of the people. In particular, the stories explore the powers possessed by such gods and their approach in unleashing it under different circumstances. Similarly, it is evident that there was an ongoing struggle between the two entities whereby some men rebelled against the wishes of these Supreme Being thus creating rifts. Moreover, most of them illustrate the development of opposition to certain activities and ideologies even among the gods thereby creating a society that was in constant turmoil (Clack and Clack 17). Furthermore, the limitations of human beings in comparison to the capabilities of the gods is handled as well and the depictions serve to make the latter’s influence known to the public. As such, it is clear that man’s opposition to the gods proves unsuccessful in most cases due to the former’s limitations on different aspects of life.


In the Iliad, Achilles leads the battle for Troy in which he is determined to capture the territory thereby amass a fortune and a great following. His anger for Agamemnon, due to the latter’s stealing of his bride, fuels his rage, and makes him launch a major attack. However, his success in the battle is justified by his ties to Zeus, the greatest god who happens to be the father of Achilles mother. Therefore, both characters are projected as showing intense passion for the same goals although prominence is given to Zeus for his power. It is evident from this myth that the gods shared certain qualities as humans such as anger. By so doing, they become relatable. However, the death of Achilles due to his insistence to return to battle to revenge that of his friend signifies the mortality of man. While the gods may offer support to man in some areas, the former are eternal beings thereby wield greater power which makes them supreme. Their ability to outlive generations facilitates their reverence and makes them seem invisible due to their vast knowledge of world events. Likewise, the difference between the needs of divine beings and those of man is also illustrated by the reference of dreams that can be attributed to the gods. For example, Zeus expresses his disapproval or support for a cause by thundering. In other instances, he uses other mortals to interpret certain signs. Furthermore, some of the myths emphasize the need of mortals to seek approval from gods before embarking on an undertaking (Versnel 171). By so doing, the man would foresee victory or defeat. Nevertheless, some of the gods’ instructions were meant to be misleading as a form of punishment for wrongdoing. Such contradictory personalities establish the common routine of man being in competition with the divine being due to his limited understanding. Whereas mortals are superior to animals and achieve epic results in challenging situations, some of his actions are in contravention of the will of the divine thereby exposing him to dire consequences. It is also a testament to the fallacy of struggling to live an earthly lifestyle rather than the righteous path envisioned by the creator. Accordingly, a warning had been delivered to Caesar by a prophet about the Ides of March but he did not heed it. The lack of belief led to his death as well.

However, they too have a resemblance to humanity through their endless love affairs. For example, the Odyssey narrates the relationship between Athena and Odysseus and tracks it until their separation. The breaking up of this union is surprising due to Athena’s vow not to leave Odysseus even during his misfortune. When that happens, the latter realizes that gods operate in another realm and are in control of people’s destiny. As such, it is a reminder that mortals cannot be equal to the divine beings regardless of their personal relationship with them. While they may be close and share many intimate moments, it is helpful to note that gods have a higher mental capacity and a greater lifespan that enables them to know the fate of humans beforehand. It would be foolhardy to expect constant affection form them especially when committing mistakes deemed sinful in their eyes. In addition, Sophocles manages to demonstrate that man’s actions are premeditated and cannot be changed to suit their wishes. Rather, they fulfill those of the divine. Oedipus tries to avoid fulfillment of the prophesy asserting him killing his father to avoid marrying his mother but ends up doing so (Versnel 168). Having been attacked at a crossroad, he defended himself by killing an older man without giving much thought to it. Likewise, he married an older woman from Thebes thinking that the faraway distance from his territory of Corinth would guarantee the nullification of the oracle’s wishes. Nevertheless, his actions accomplished this feat and he ended up committing suicide. Therefore, this myth indicates that divinity is more superior to humanity and the gods’ plans have to come to fruition despite the numerous resistances that may be mounted by man.

Furthermore, there is a shared obsession with honor among them too. Man tries to seek revenge when he/she has been wronged and the gods mete out punishment for any disobedience. For instance, Achilles believes that the death of his friend is a shame to him as well as his territory hence he decides to revenge by going back to the battlefield despite numerous warnings against doing so. According to him, reclaiming victory would redeem his image and earn him a hero status among the subjects. The gods are also divided as to the best course of action thus engage in partisan activities aimed at dethroning each other as a way of gaining credibility. In both instances, the emotions and needs of the divine beings are in display. Consequently, their rage is expressed in much the same way that man does. By so doing, their likeness to man becomes apparent. Similarly, some of the myths use various abstract representations of nature to make them more believable and simplify their perception as well. For example, the Olympian gods are described as taking the form of fire, weather, water, and love. Such descriptions fit extreme symbols of humanity used to convey certain emotions. In particular, the alternating personalities of gods imply that despite their proximity to humans, they had supernatural powers at their disposal that enabled them to change into various formats depending on the circumstances (Clack and Clack 56). As such, this attribute distinguished them from the mortals thereby cementing their high-ranking status. In fact, in Homer, sometimes the gods combined all these characteristics hence contrasting the few heroic deeds of man.

Moreover, the personification of nature by gods signifies a closer interaction between the two entities in which the divine beings choose symbols familiar to man to simplify the substance of their messages. Therefore, they also take up responsibilities as though they are human. For example, the gods’ parental role is displayed by Sophocles and Sappho. In Sophocles’ Aias, he is authoritative and very stern by providing harsh warnings to the characters and expects them to follow his directives without deviation. Athena becomes stubborn to Ajax and this makes him insane thereby preventing the murder of the Greek commanders. However, Sappho’s depiction shows the gods as caring and protective. Aphrodite plays a motherly role by assisting in different ventures whose aims are to gain victory and happiness. Nevertheless, the difference is that the parental role adopted by the gods is without blemish. The subjects do not have any grounds to talk back or taunt the gods because these are holy creatures. In contrast, mortals are seen to have committed certain sins and sometimes their children use those against them. Whenever they are involved in arguments, they keep reminding them about the ills they had previously committed hence justifying the notion that no human is flawless. Therefore, man cannot compete with the divine, as the latter will outwit him

Similarly, the gods seem to play controversial roles in different stories. In every heroic tale, there appears to be a god who favors the victor in any war. Therefore, it is amusing since it implies that the divine makes the heroes. However, it is clear that any mortal who would like to succeed has to have a personal relationship with the deity. For instance, Patrocalous death is blamed on his lack of a god on his side (Hesiod 18). Therefore, depending on one’s level of interaction with the gods, they can either hinder or help the hero. It shows that gods also have similar motivations to humans but have to alternate between having a physical presence and a psychological one. Notably, the gods use forces of nature to reveal themselves but retain a lasting ideology in which they are thought to be ever-present to maintain their importance. Such a tactic is helpful in outlining the stratification of the society thereby creating a hierarchical structure that places the deity as the supreme authority. By assuming the role of a decider of events despite possessing human characteristics, it emerges that the authority of the gods is final and unquestionable. It would then be disastrous to oppose them, as that would lead to death as well.

            Equally, the mention of amorous traits among the gods reveals that despite their vulnerabilities, humans avoided scolding them. By so doing, it reinforces the notion that the divine beings are above reproach and no mortal should blaspheme them. For instances, Zeus was the father of all the gods. However, he was unfaithful to his wife, Hera by having a series of affairs. Such relationships were similar to those practiced by aristocratic families since they illustrate the struggles that befall the elite in the society. While it would be thought that the wife would be unfaithful as well, she remained loyal to him. Nevertheless, despite the comparison to mortals, it is evident that Zeus ran his family on different sets of principles than those run by humans hence highlighting the difference between the two systems. By so doing, it underwrites the supremacy of the divine by giving them the inherent powers to conduct oversight over humanity.

            Such tales show that humanity strives to have the powers of their gods. By constantly referring to the heroism of the gods, the characters portray a desire to emulate the successes achieved by the divine. In particular, it is evident that they attempt to incorporate such kind of reasoning into their daily lives. Therefore, the strengths exhibited are an indication that humans strive for supernatural powers that would guarantee success in their endeavors thereby helping them top solve the world’s problems. Additionally, they show a link between myth and history in which the former form part of the ancestry of the people. As such, the relationship between the two entities provides a historical perception of events, which aids in creating a rationale for the occurrence of certain traditions (Versnel 217). By so doing, the importance of specific rituals is emphasized as they are deemed to guide individuals in living a righteous life. While such a comparison is vital in the lifestyle choices of different groups, it is noteworthy that humans are limited in their understanding about nature and the principles that facilitate the success of the ecosystem. In fact, it implies that their intellectual abilities are minimal as compared to those of the gods hence they need to submit to the divine’s authority. Accordingly, there is need to seek favor from them especially when faced with difficult challenges owing to their unique understanding of the universe. Furthermore, it also illustrates the intimacy between them, which is integral in building lasting relationships that have a happy society as their objective. The myths indicate the exemplary nature of the divine that has to be revered at all times as well.

            Moreover, the myths assert that mortals cannot intervene in the issues of the gods. In most instances where the divine beings have an altercation among themselves, the human species is relegated to the sidelines to watch as they battle. It is clear that such fights are beyond man’s capability due to the supernatural powers that are in conflict. In fact, they are not even consulted. They only await the outcomes. However, prominence is given to the fact that mortals are prone to interruptions by the divine sometimes to their displeasure (Hesiod 41). In such cases, the victims have no choice but to abide by their wishes. Consequently, it is a sign of the authoritative force of the deity whereby they have the power to influence things while the human creatures do not. It is also a testament to the humane nature of the gods as well. Therefore, the myths reinforce the notion that mortals are bound to suffer for attempting to adopt some of the dive’s power. Accordingly, they illustrate the extent that the deity will go to make him/her aware of his/her place in the world. By so doing, they prove the hollowness of man seeking to replace the divine beings thereby setting a precedent that is applicable in the current era. They justify the validity of the gods’ interventions by documenting positive outcomes for various characters as well hence emphasizing that the divine has varying goals for accomplishment on Earth. Their implementation cannot be derailed.

Therefore, the divide between humans and the divine helps to instill morality in the society. In particular, it provides people with a sense of right and wrong thereby enabling them to avoid evil behavior that minimizes things such as death. By so doing, it makes people to exhibit ethical traits in their personalities, which are vital in maintaining law and order within the community. It also aids in the establishment of obedience to authorities as well especially to the people elected in leadership positions. For example, it creates a form of social stratification within households that facilitate the respect awarded to parents as the heads of the households thus making children to be dutiful to them. They learn to follow instructions. They are also initiated into scriptural teachings, which mould their characters. Upon maturing into adulthood, they become responsible citizens who can be trusted to conform to societal norms and permitted to raise their own families too. As such, it leads to the maintenance of normalcy due to the inherent desire to live a righteous life in fear of offending the divine and being a victim to the impending punishment that waits sinners (Hesiod 27). Likewise, the knowledge of man’s inability to surpass god also gives him the impetus to make innovations aimed at simplifying tasks and enhancing the quality of life. Having noticed the immense talent bestowed on mortals and the divine’s willingness to assist in life struggles, this opposition has become beneficial in the increase in frequency of discoveries that seem to marvel God’s prowess by fueling the ambition to discover new products or systems of doing things. By so doing, it has advanced globalization.

            Similarly, it also offers mental peace to many people who face insecurities, uncertainties, and dangers. Such situations are bound to result in hopelessness. However, the presence of a supreme being brings consolation and encouragement that helps to make individuals to counter the problems they face. Additionally, it also promotes the development of democratic political systems due to its manifestation in leadership activities. For example, leaders take oaths in God’s name thereby promising to uphold the laws and preside over the implementation of various programs that are in tandem with the divine’s wishes. For instance, the issue of abortion is reflective of the need to implement Christian values. Therefore, the recognition of the divine’s existence and his plan for the world is incorporated in political circles to help systems of governance to conform to moral standards. In fact, only upon the realization of the gravity of the problems faced by the world do officials invoke the Supreme Being’s principles in the day-to-day operations of governmental work. Moreover, it also aids in welfare development by facilitating the notion that service to God entails service to humanity. As such, it brings about a communal approach to living in which philanthropy and giving to the less fortunate is part of the cultural norm. By so doing, it makes cooperation among different nationalities a mutual concept that results in social harmony.

            It regulates the social wellbeing of people as well. It maintains social control of organizations by installing virtues such as honesty, love, non-violence, and discipline thus making people to live in a just environment. The acknowledgement of consequences for wrong behavior is a deterrent that helps to influence members to do the right thing. Furthermore, it aids in the adoption of better capitalistic mechanisms that seek to eliminate fraud in financial matters thereby boosting the economy. As such, it also offers people with a chance to practice social solidarity through common worship, belief, and participation in rituals that aim for communal unity. Division of time, venues, and resources to schedule fellowship meetings are appropriate tactics for enhancing closer interactions and bonding among followers who are then reminded of the supreme will of the divine over their lives hence encouraging them to worship and praise (Clack and Clack 32). Such gestures encourage the continuity of the divine’s relevance in the world especially at a time when secularism is on the rise. The differences arising in the creation of an anthropomorphic deity help in the development of a healthy work-life balance too whereby individuals strive to use their talents for the benefit of humanity without straining so much. It thus enriches diversity at home, workplace, and other public arenas that makes people preoccupied with meaningful chores rather than be engaged in illegal activities. Moreover, the freedom to provide expressions about one’s relationship with the divine while sticking to the supernatural and all-powerful narrative of the creator encourages the preservation of fundamental rights such as the freedom of expression, which are necessary to promote accountability in any environment. Having this free will is a sign that people can be trusted to perform their duties in ways that compliment established rules leading to the achievement of social parity among members. Likewise, it creates meaning and purpose in life since people prepare for the after life (Versnel 157). As the revelation of the limited opportunity that man has to correct his/her mistakes dawns, the individual embarks on a reconciliation mission with the Maker by integrating righteous activities in the daily routine. It is done due to the acknowledgement that humans are mortal yet the divine is eternal hence making it essential to avoid sinful traits that increase conflicts with fellow men and God. Acceptance of such humility becomes the genesis of good morals within neighborhoods that oversee the implementation of social control among the masses. Therefore, moral decadence is minimized.


Most Greek myths are laden with tales about the interaction between mortals and gods. |they explore the close relationship that heroes had with certain gods by illustrating the importance that humans place on consulting the divine before undertaking challenging tasks. In these stories, it is evident that gods do possess human qualities such as emotions of anger and love. However, it is also clear that they are supernatural beings whose power is beyond human comprehension. As such, man’s intellect is limited and his actions are subject to divine approval. For instance, wrongdoings are punishable while righteousness is rewarded. Consequently, the presence of such a relationship is vital in the understanding of global events due to the significant role that morality plays in maintaining social order. Having advance knowledge of right and wrong helps to alleviate many ills due to the enhancement of consciousness within the society. Moreover, the inclusion of God in communal activities is integral in the promotion of social justice that uplifts the standards of living. Nevertheless, the divine is still revered due to the endless power he has over humanity.




































Works Cited


Clack, Beverley, and Brian R. Clack. Philosophy of Religion: A Critical Introduction. New York, NY: John Wiley & Sons, 2014. Print.

Hesiod, C S. Morrissey. Theogony: Works and Days. Vancouver: Talonbooks, 2012. Print.

Versnel, H S. Coping with the Gods: Wayward Readings in Greek Theology. Leiden: Brill, 2011. Print.





Discussion II





Week 4 Discussion II

What is a financial risk?

Financial risk is defined as the possibility of accrual of losses for an investor in a company that has debts and is unable to generate adequate cashflows to meet its financial obligations. In addition, financial risk is also understood to be the possibility of an entity or government in defaulting its bonds that would result in the loss of investments by bondholders. Investors are able to assess financial risk using ratios to evaluate inherent or associated risk of an investment. The debt-to-capital ratio is an example of a measure used to evaluate the percentage of debt acquired and the overall capital structure of an entity.

High debt usually illustrates high risk given that it translates to decline in ability to fulfill financial obligations in entirety. The capital expenditure ratio is another type of ratio used to evaluates the cashflow accruable from operations by dividing them using the capital expenditures to arrive at the amount of money that the entity has available to ensure continued operations after repayment of debts (Boughton 39).

What is a defaulting on an interest rate swap?

An interest swap is defined as an agreement by entities to their respective interest rate provisions through access to one another’s credit arrangements. Interest rate swaps are usually agreements aimed at taking advantage of low credit costs by accessing other lines of credit owned by another organization. Interest swaps are easily combined with debt issues to alter the nature of liability accruable to a borrower. Interest rate swaps have two inherent risks namely default and rate risk. Default risk is seen to be difficult to hedge. Default results in the party undertaking credit, being unable to finance the funds accrued or sourced using the interest rate swap agreement. This is also seen to be a form of credit exposure (CE), which is defined as an immediate loss accrued to a one party if the counterparty defaults on the credit derivative (Moosa 29).

What is a counterparty risk?

Counterparty risk is defined as risk assumed to both parties based on the presumption that the two sides may not fulfill their contractual obligations. It is also understood to be similar to default risk given that both parties assume a similar level of risk whereby one is counterparty to the other. Credit derivatives are the only financial instruments that have inherent counterparty risks.

How a currency swap can reduce the above risk?

Currency swaps are important financial instruments used by financial institutions, corporations, and investors. They function in a similar manner to interest rate and equity swaps. Currency swaps are complicated in nature given that they involve two parties who exchange principal with each other with an aim to access exposure to specific currencies. Based on such notional exchanges, the cashflows from time to time are traded for an appropriate currency (Arize 44).

This are considered as effective financial instruments because they enable multinational entities to utilize their relationships when expending into new markets by enhanced access to new currency. Hedging in currency swap can be undertaken by developing forward contracts. Currency swaps provide an effective means of hedging risk of a portfolio as well as against exchange rate volatility (Aronson 53).


















Work Cited

Arize, Augustine C. Balance of Payments Adjustment: Macro Facets of International Finance Revisited. Westport, Conn: Greenwood Press, 2010. Print.

Aronson, David R. Evidence-based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals. Hoboken, N.J: John Wiley & Sons, 2007. Print.

Boughton, James M. The Monetary Approach to Exchange Rates: What Now Remains? Princeton, N.J: International Finance Section, Dept. of Economics, Princeton University, 2008. Print.

Moosa, Imad A. Structural Time Series Modelling: Applications in Economics and Finance. Hyderabad, India: ICFAI University Press, 2006. Print






Week 4 Discussion

What is the Absolute and Relative PPP?

Absolute Purchasing Power Parity is the notion that the trend of exchange rate between countries is directly proportional to the price levels of such nations (Domowitz 11). Consequently, the price of merchandise is equal in all trading countries. However, the Relative Purchasing Power Parity links the changes of a country’s rate of inflation to its exchange rate changes as well. As such, inflation differentials are compensated by alterations inn the exchange rate.

What is the Real Effective Exchange Rate Index?

It is the average calculation of the bilateral Real Exchange Rates of a nation with those of other trading blocks in comparison to their respective trading shares (Jones 1). Therefore, it is the measure of a currency’s change in exchange rates against others, which have undergone inflation adjustments. By so doing, the extent of competitiveness in the international market can be illustrated.

What is the Fisher Effect?

The above is the practice of nominal interest rates changing in correspondence to alterations in the rate of inflation resulting from money supply changes. An increase in the former thus causes a rise in the latter as well (Beggs 1).

Does the International Fisher Effect exist in practice?

The International Fisher effect is just a model because the real and nominal interest rates are not out rightly known (Ray 2170). They are an approximation, which assume nominal interest rates in every nation are similar to the obligated real rate of return including any inflation compensation. Therefore, the IFE is dependent on the rate of real inflation, which is a lagging indicator that keeps changing due to market forces.

What is the relationship between interest Differentials and Forward Discount or Premium?

In international trade, one country’s central bank or any other financial institution sets an exchange rate that it would be willing to transact business on at a future date hence hedging such funds presently. Nevertheless, changes in the interest rates affect the amount of premiums to be paid by reducing this figure in tandem with a lowering of such rates. Such quotations are thus subjected to readjustments depending on the behavior of the markets thereby affecting the final disbursement upon maturity.

What is the CIA?

Cash In Advance refers to the scenario whereby a buyer pays for merchandise before they are delivered. It also involves services as well. Sometimes, it is known as cash before delivery and various procedures are incorporated (Dotsey 632). Such guidelines seek to cushion the consumer from unnecessary delays or damage to the goods hence ensuring that the supplier is liable for any default to the agreement.

Is the Forward Rate an Unbiased Predictor of the Future Spot Exchange Rate?

The forward rate is a biased predictor of future spot exchange rate because of its regression on the depreciation value. In particular, this occurs when the arte is placed against the forward premium thereby producing conflicting results to those that base on the forward rates (Kang 221). Moreover, the forward rate is influenced by speculation and arbitrage hence making it difficult to make future spot exchange rate forecast. Changes in the current spot rate and forward rate result in alterations of the forward premium thus influencing its outcomes.

Is the Foreign Exchange Market Efficient?

The foreign exchange market is efficient due to the quick transition resulting from unpredictable variables that may occur in future. For example, political instability or alterations to certain goods may trigger realignment of foreign markets thereby affecting the value of different currencies (Levich 12). Moreover, while exchange rate differences exist, speculative activity about the course of various currencies affected by macroeconomic variables helps to mitigate risks thereby avoiding huge losses. However, the structure of the market makes it possible to compensate such losses with a rise in interest rates that compensate for the reductions.

Works Cited

Beggs, Jodi. The Fisher Effect. AboutEducation. 12 January 2015. Web. 27 January 2015. <>

Domowitz, Ian. Absolute Power Parity and Relative Power Parity. Institutional Investor Journal, 2013. Print.

Dotsey, Michael. Cash In Advance. Journal of Monetary Economics, 45.3 (2000): 631-655. Print.

Jones, Peter. Real Effective Exchange Rate. Macroeconomic Analysis, 26 March 2008. Web. 27 January 2015. <>

Kang, HeeJoon. Forward exchange rates as unbiased predictors of future spot rates a review and re-interpretation. Open Econmics Review, 3.2 (1992): 215-232. Print.

Levich, Richard. Empirical Studies of Exchange Rates: Price Behavior, Rate Determination, and Market Efficiency. National Bureau of Economic Research, 2014. Print.

Ray, Sarbapriya. Empirical Testing of International Fisher Effect in United States
and Selected Asian Economies. Advances in Information Technology and Management, 2.1 (2012): 2167-6372. Print.