Practical Pricing Essay Example for Free

Practical Pricing Essay Through a thorough analysis of activity-based costing, it is obvious that there is more information to account for than first expected. It is essential that management be able to understand the concept of ABC beyond the surface in order to grasp the manner in which it behaves. Besides the fact that it is a concept which involves the measurement of manufacturing costs and non-manufacturing costs, ABC has a considerable amount of information to be understood. The manner in which the system is implemented in various companies is essential for management which is contemplating whether or not to use such a system. As well, it is necessary that myths and misconceptions about the subject be clearly understood in order to prevent any ill-fortune to a company. As well, it is evident that ABC has emerged as an important concept in the field of Cost accounting. With many issues at the forefront of Cost accounting, perhaps one of the frontrunners would be the issue of globalization. These current issues provide an interpretation that activity-based costing has emerged as an important aspect of Cost accounting in the sense that it is instrumental for managers when making crucial decisions The accounting cost methods described here dont end when optimal pricing has been achieved and variability brought under control. These are only the first two milestones in a continuing process of pricing for maximum profitability. Next, companies must identify products that are no longer profitable and monitor customer churn for signs that prices are higher than the value provided in return. Any products value proposition changes as the market evolves. The number of competitors might swell or shrink; new products or versions of products could be launched; competitors might start or stop giving rebates. Thus, every time market information is collected, it is vital to measure the customer and sales churn of every product even if prices havent changed recently. It may be necessary to change prices as a result. Since net or final are always moving, a products total cost and its impact on profits should also be monitored. Products that dont meet managements minimum profit requirements may have to be discontinued. Of course, a product it itself is losing money may be worth keeping for strategic reasons, such as rounding out a comprehensive product line or serving as a mechanism for appealing to big customers. The analytical rigor and unbiased nature of this approach make considerable organizational demands on the companies that use it. A change in pricing is a major enterprise for any organization; it cant be achieved overnight. Companies accustomed to anecdotal approaches may resist. For these reasons, it might be wise to form a specific group to make pricing recommendations and monitor the impact of price changes. With the support of the sales organization and senior management, the group could put forward pricing suggestions even in the face of opposition. By closely monitoring the impact of price changes, the group would be alert to the need for midstream adjustments. To the extent that the organization must evolve over time from a sales-and-technology orientation to a focus on pricing and the bottom line, the pricing group could be the agent of that transformation. Of course, the leader of the group shouldnt report to anyone directly affected by its recommendations, even if that person for example, the vice president of marketing or finance would otherwise be a logical choice. Moreover, a clear succession plan should be developed to get high-caliber people, especially from sales, to work in a somewhat isolated pricing group. They ought to understand that there will be no negative political repercussions if they want to return to sales or move up the corporate ladder, for by necessity if they want to return to sales or move up the corporate ladder, for by necessity such a group will often irritate the senior people in a company. Finally, pricing can be a key lever of profitability. Bibliography 1. Anderson, R. J. , Hughes, S. A.  and Sharrock, W. W. (19xx) Practical Pricing, in Working for Profit: The Social Organisation of Calculation in an Entrepreneurial Firm (Aldershot: Gower), chapter 8, pp. 139-157 2. Brimson, James A. Activity Accounting. New York: John Wiley Sons, Inc. , 1991. 3. Carrol, Raymond F. Chesley, G. R. Garrison, Ray. Noreen, Eric. Managerial Accounting: Concepts for Planning, Control, Decision Making. Toronto: McGraw-Hill-Ryerson Ltd. , 2001. 4. Foster, George. Horngren, Charles T. Cost Accounting: A Managerial Emphasis. New Jersey: Prentice Hall Inc. , 1991.

Snowboarding trip :: essays research papers

Snowboarding can be an energizing, invigorating experience and I think that everyone who likes skateboarding should give it a try. Snowboarding is very similar to skateboarding, the only differences are that you have to be strapped to the board and you need snow. The only type of equipment you need to snowboard is a snowboard and warm clothes. Snowboarding can be done at any ski resort and is growing in popularity. On my nineteenth birthday I decided that I wanted to go to Peak-in-Peak ski resort. I called TJ, Scott, and Justin to invite them on this trip; they all accepted my invention to go. The fact that the three of them have skateboarded with me for a number of years I knew that they would be interested in learning to snowboard; what better time than this trip to do so. The ski resort that I had picked for the trip was in New York. Peak-in-Peak was perfect for all levels of snowboarding. I was most interested in the snowboard train park that was offered there. February 22, 2001 we arrived at our condo that I had rented for our weekend of excitement. It was Friday at about 5:00pm, the Friday of my birthday. After checking in we were all eager to hit the slopes. We all got changed into our snowboard gear and set out for some fun. TJ and Justin caught on to the sport very quickly, after a couple of falls they were up and going down the hill. Scott took a little more time and instruction from me to pick up the art of going down the hill. After all the fun snowboarding we went back to the condo with some newfound friends and had a party. The party got a bit out of control at about 3:00am and the police were soon there to bust up the party. We all were issued under

Lies My Teacher Told Me Essay

There is a common expression that a lot of us have heard at least one time â€Å"don’t believe everything you read†, just because a book is written and published does not mean is always accurate. True historical facts can easily be transformed by adding or taking away details in order to see it only from a certain perspective. The textbooks in history classrooms represent many different groups from the perspective of one group, usually European. Loewen explores the topic of why students dislike history classes. He also discusses the idea that much of what students learn in American history classes, is wrong and that there are many omissions. He challenges the Public School system mostly in regards on how history is taught in high school classrooms. American history books wish to paint the United States as the best country, almost to the point where they make it seem that it doesn’t have any flaws. A lot of books used to teach history in high school neglect to include the entire information on events that formed the United States. Reading some essays from the book Lies My Teachers Told Me helped me open my eyes and see how wrong history is taught in high school; we as citizens need to do the proper research and spread the knowledge among peers to create socially aware generations. Most of the time American history isolates children of color by ignoring the fact that many of the people who contributed greatly to this country were non-white. In a sense, one can say that this contributes to the majority of high school students thinking of white as superior to other races. They think that no other races made great contributions in building this nation. This mentality can be seen as an immediate effect of history classes omitting details about other races major contributions to the country. According to Loewen most students also see history as a boring subject, this is because history is made up of nothing but stories that shouldn’t be boring but textbooks companies have left out anything that â€Å"might reflect badly upon our national character†(Loewen). The case of John Brown is a good example of something that might reflect badly to our national character. He was an American abolitionist who believed armed revolution was the only way to overthrow slavery in the United States. The name John Brown was never mentioned in any of my history classes. After learning about John Brown, my perspective of things changed and it made me see that the people who are responsible for putting the books in high school classrooms, are trying to keep students at a margin in which nobody can learn anything about rebels who used violence to make a statement about inequalities lived in the United States. Omitting this historical fact from books and not permitting teachers to give students the knowledge about John Brown makes it seem that they want to keep people under control and avoid some kind of revolution. That is because, until these days there is a lot of inequalities but seems like everybody just goes along with their life and overlook many inequalities that are going on in our nation and the world. The study of history in high school is mostly all about facts and dates. Students find this to be irrelevant and have a difficult time to make the connection between history to their daily lives. Therefore, making history really boring and the material presented does not really challenge any student to think critically and analyze history. The topic of social class is never touched in high school, which is something that everybody relates to. The issues seen in â€Å"The Land of Opportunity† can make a lot of people gain instant and undivided attention because we can actually relate to it. It makes you analyze how we live and that is something that affects our daily lives. In high school most students are fed the idea that everybody has an equal chance to achieve success through education, but there is an inequality that puts people of higher social status in an advantage to achieve better scores in tests given in high school. Even without coaching, affluent children are advantaged because their background is similar to that of the test makers†(Loewen,208). It is important for students and people to know that equal opportunity it’s just a phrase that has been propagated by white people. People of color in this country have never had an equal chance to thrive the way white people have. History classes in high schools lead students to believe that everything is okay, so students are not troubled. This view of history holds the American idea of individualism rather than looking at the many factors that affected lack of equal opportunity. High school history courses make us believe that equal opportunity was and is an option for all when the reality is very different. A lot students and people still do not know this, it is important to spread this kind of knowledge among people we know in an attempt to make them socially aware. If it doesn’t enforce an immediate change, at least an idea is established and they eventually can look into it when they realize that, in fact the world is not always fair to minorities. By students understanding this, it would make it easier to make a change and achieve many of their goals. Textbooks ignore many historical realities for a variety of reasons. One of the main reasons is that publishers believe that students must develop a sense of nationalism or patriotism towards the United States. To acknowledge troubling areas in our nation’s history is to run the risk that patriotism is not going to be developed. They distort events and avoid conflict that might spark up some type of controversy. This causes students to fail in engaging and analyze information and draw their own conclusion about the credibility and cause and effect of the events being presented. Instead, students have to memorize the standard information given, which is often times is wrong and manipulated. This wrong information builds around them without students actually making a critical analysis or whether the information is true or not. All the important issues that we don’t learn in class makes me think as a citizen to do my own research and learn the facts about any issues. Not only in regards of history but also in situations that are going on in different parts of the world. Because the fault for our misinformation is not entirely from publishers who need to sell books or interest groups that prefer myth to reality, each of us who learned this myths and believes them as untouchable are also to blame. We need to change this and speak about it to the people we know in order to create socially aware generations, by just speaking to some people it can create a chain reaction and eventually more citizens are going to be informed. By spreading the knowledge a lot of change can come, the change might not be immediate but if we are not actors we will never be factors.

The Civil Rights Movement in 20th Century America

The Civil Rights Movement Until the 1950s, African Americans had experienced discrimination in all aspects of their lives. They were no longer slave, but they were definitely not equal citizens. During the 1950s and 1960s, African Americans, along with a number of other racial groups, embarked on a campaign to change this situation. This campaign challenged discrimination and fought to achieve the objective of equality that the American constitution promised for its entire people. It composed a number of significant groups, individuals and events to fulfil this vital objective. It was known as the Civil Rights Movement. Significant Groups The National Association for the Advancement of Coloured People (NAACP) was founded in 1909 by WEBB†¦show more content†¦It faded out of existence in the 1970s. The Black Panthers were a political militant group of the Civil Rights Movement, led by Huey Newton and Bobby Seale. The Black Panthers were the opposite of other non-violent organisations in strategy, but the principal behind their actions was the same. They were advocates for the reconstruction of American society to achieve social, political and economic equality for African Americans. They patrolled black communities and protected the residents from abuses of police power. Although some of the significant groups during the Civil Rights Movement differed in their way of doing things, they all had the same message to send. Their objectives were to stamp out inequality for African Americans and put a stop to discrimination, racism and segregation, which were in turn the objectives of the Civil Rights Movement. Significant Events In 1957, just following the end of desegregation in schools, nine African American students attempted to attend the Central High School in Little Rock, Arkansas. They were met by a racist crowd who hurled threats and attempted violence against the nine students to the extent where the US army were called in to protect the students from the angry mob. They were the first African American students to be integrated into a white high school. The pro-segregationists of Little Rock engaged in campaigns of hatred andShow MoreRelatedThe Jim Crow Laws And School Segregation810 Words   |  4 PagesThere were many forms of discrimination in America. Discrimination was everywhere in the 20th century, and the population most affected by this were African Americans. Two of the most critical injustices committed in America during the 20th century were the development of the Jim Crow laws and school segregation. However, these injustices have been rectified as a result of the Civil Rights Movement and the decision of the supreme court of Brown v. Board of Education which brought important changesRead MoreThe Movements of the 20th Century Culture Essay1170 Words   |  5 Pagesthe most important events that occurred in the 20th century? A century that was full of many innovations; most importantly, these events made a tremendous impact in our lives as of today. The 20th century contributed an abundance of improvements to our culture. In addition, the progressions of the advancement helped society lives to better, such as the industrialization, the remarkable inventions that made our lives easier. Nevertheless, the 20th century presented a copious amount of remarkable artistsRead MoreThe And The Great Depression1233 Words   |  5 Pagesof the 20th century in the United States was filled with peace and prosperity. However, in the background war was on the horizon. After two world wars and the Great Depression, some of the movements of the 19th century were re-established. Moreover, new movements emerged in response to the issues created from the wars and the Great Depression. I will discuss the major religious, social and political movements that emerged in the 20th century. Religious Movements During the 19th century, manyRead MoreDBQ Questions781 Words   |  4 Pagesï » ¿DBQ QUESTIONS Writing the DBQ Civil War Assess the following quote: â€Å"Ultimately, the Civil War reduced sectional antagonism and made the United States truly ‘one nation.’† ____________________________________________________________________________________________________________________________________________________________ The Constitution Using information from the evidence below as well as your knowledge of the period, discuss the development of the United States Constitution as aRead MoreThe Abolition Of Slavery And The Civil War1349 Words   |  6 PagesThroughout American history there have been numerous civil rights movements and shifts of thoughts and beliefs. One of the largest and arguably the most impactful movement was the movement to end slavery. America has always been divided on the issue, and even to this day there are harsh sentiments between different ethnicities. America made an official decision on the matter following a brutal and violent civil war. The Thirteenth Amendment was passed on January 31st, 1865 and read: â€Å"Neither slaveryRead MoreEssay on How Did the Civil Rights Movement Change America?694 Words   |  3 PagesHow did the Civil Rights Movement Change America? Research Paper Amber Paschal Young Henderson Middle School Thesis This paper will explain how the civil rights movement changed America. The civil rights movement occurred to ensure African American rights, and plummeted during the 1950s and 1960s. if this movement wasn’t successful, the world would be way different than it is today. The civil rights movement was the time in America in which AfricanRead MoreLatino Americans And Hispanic Americans1114 Words   |  5 Pages2009 their population has more than doubled (Healy 2012). MEXICAN AMERICAN HISTORY In the southwest United States during the 19 century, The Mexicans were thwarted and overcome. The white majority used the Mexican Americans to preform jobs for an inexpensive price. These jobs often included farming and ranching construction of the railroad and mining. By the 20th century Mexican-Americans, along with the American Indians, were powerless, poverty-stricken, and isolated in rural areas. Much like theRead MoreThe End Of The 20th Century1544 Words   |  7 PagesHistory since the end of the Civil War to the end of the 20th century has changed drastically when you asses America on an economic, social, and political level. The changes between the end of the 19th century and the end of the 20th century are the cause in the way America has been shaped and how American’s think. In fact, industrialization and urbanization, equal rights for all citizens, and two world wars played a major role in the shape of America to our understanding. Although, there are numerousRea d MoreHistory Of Rock Roll Isn t Close On Being A Perfect Story982 Words   |  4 Pagesinspiration that created the later of music genre s. Through these events we get a glimpse on how inspiration effected the dance, genres, cover controversies, civil right movement, Motown Stax that became to be. Like any story, there is a beginning, which to start from. The slave trade took place between the 15th century and the 19th century. Many of the Africans that were taken into slavery where from the western and central parts of Africa. This is important to know to understand the culture ofRead MoreNew Orleans And The Child1269 Words   |  6 Pagesmyriad issues that encompass slavery, segregation, civil disobedience, wars, and natural calamities among others. The image, New Orleans woman and the child she held in slavery, depicts one of the key issues that afflicted New Orleans, that is, slavery. Slavery was a significant concern in the 1800’s and was at the center of a majority of declarations made at the time. As a modern community, most gains made in America on the front of human rights emanated from slavery. Everyone in the whole wide

Flores Surname Meaning and Origin - About Genealogy

The surname Flores has existed in Spain since the 12th century, but a common origin has not been found. It is believed to most likely derive from the given name Floro, meaning flower from the Latin flos. Flores is the 55th most popular surname in the United States and the 15th most common Hispanic surname. Surname Origin:  Spanish Alternate Surname Spellings:  FLOREZ, FROYLEZ, FROLAZ, FLORIZ, FLORAZ, FLOR, FLORAN, FLORIAN, FLORIO, FLORIS, FLORI Famous People With the Surname FLORES Pedro Flores - inventor of the yo-yoFrancisco  Flores  Perez - former president of El SalvadorJuan Josà © Flores  - first president of EquadorMarco Antonio Flores  - Guatemalan writer and poetJosà © Asuncià ³n Flores  - Paraguayan composerSalvador Flores -  Alamo defender; recruiter of volunteers in support of the Texas Revolution Where Do People With the FLORES Surname Live? The surname distribution data at  Forebears  ranks Flores as the 167th  most common surname in the world, identifying it as most prevalent in Mexico and with the highest density in Honduras. The Flores surname is actually the most common surname in the nation of Bolivia, and also ranks among the top ten last names in Peru (2nd), El Salvador (4th), Honduras (5th), and Guam (10th) and Mexico (10th). It is also common within Guatemala, Chile, Venezuela, Belize and Argentina.  Within Europe, Flores is most frequently found in Spain, according to  WorldNames PublicProfiler, especially the western provinces of  Badajoz and  Cà ¡ceres. The Flores surname is also found throughout the United States, where it is most common in the states of California and New Mexico. Genealogy Resources for the Surname FLORES 100 Most Common Spanish SurnamesHave you ever wondered about your Spanish last name  Ã‚  and how it came to be? This article describes common Spanish naming patterns, and explores the meaning and origins of 100 common Spanish surnames. How to Research Hispanic HeritageLearn how to get started researching  your Hispanic ancestors, including the basics of family tree research and country specific organizations, genealogical records, and resources for Spain, Latin America, Mexico, Brazil, the Caribbean and other Spanish speaking countries. Flores Family Crest - Its Not What You ThinkContrary to what you may hear, there is no such thing as a Flores family crest or coat of arms for the Flores surname.  Coats of arms are granted to individuals, not families, and may rightfully be used only by the uninterrupted male line descendants of the person to whom the coat of arms was originally granted.   Flores Family Genealogy ForumSearch this popular genealogy forum for the Flores surname to find others who might be researching your ancestors, or post your own Flores query. FamilySearch - FLORES GenealogyAccess over 6.3 million free historical records and lineage-linked family trees posted for the Flores surname and its variations on this free genealogy website hosted by the Church of Jesus Christ of Latter-day Saints. FLORES Surname Family Mailing ListsThis free mailing list for researchers of the Flores surname and its variations includes subscription details and a searchable archives of past messages. DistantCousin.com - FLORES Genealogy Family HistoryExplore free databases and genealogy links for the last name FLORES. The Flores Genealogy and Family Tree PageBrowse family trees and links to genealogical and historical records for individuals with the last name Flores from the website of Genealogy Today. ----------------------- References: Surname Meanings Origins Cottle, Basil.  Penguin Dictionary of Surnames. Baltimore, MD: Penguin Books, 1967. Dorward, David.  Scottish Surnames. Collins Celtic (Pocket edition), 1998. Fucilla, Joseph.  Our Italian Surnames. Genealogical Publishing Company, 2003. Hanks, Patrick and Flavia Hodges.  A Dictionary of Surnames. Oxford University Press, 1989. Hanks, Patrick.  Dictionary of American Family Names. Oxford University Press, 2003. Reaney, P.H.  A Dictionary of English Surnames. Oxford University Press, 1997. Smith, Elsdon C.  American Surnames. Genealogical Publishing Company, 1997.

Good Health And Wellbeing Through Exercise 7 - 1434 Words

Good Health and Wellbeing Through Exercise 7 Exercising also gives people discipline. It teaches people about hard work, failure, and success. This is because almost all of life’s lessons about failure and success can be learned from just one workout session. When people exercise, they put a lot of pressure on their body and spend a lot of energy, so it does not take long for their body to become tired. When the body starts to get tired, it sends pain signals to the brain and the brain first thought is to stop whatever is putting pressure on the body, so the pain will go away. Therefore, it will send all types of messages to try to make the person stop working out. This is similar to the process anyone has to go through in order to be successful, like when college students spend hours studying in order to reach a certain goal. The process is very difficult and everyone experiences obstacles along the way, so naturally the mind starts to question itself and the persons intentions which becomes stressful and at some point in time it makes most people just want to give up and stop trying. However, during exercise, whenever anyone gets through those thoughts of quitting, and through the painful hard work that it takes to finish the workout they become stronger, not only physically but mentally as well. When most people begin exercising, they find it hard to believe that doing just a bit of physical activity everyday will physically change their body and make them lookShow MoreRelatedEarly Childhood Teacher And A Psychologist1525 Words   |  7 Pages â€Æ' Item Title Page 1. Introduction 3 2. Job Description 7-5 2.1. Early Childhood Teacher 4 2.1.1 Tasks 5 2.1.2. Personal Requirements 5 2.1.3. Education and Training 5 2.2. Psychologist 5-7 2.2.1 Tasks 5 2.2.2. Personal Requirements 6 2.2.3. Education and Training 7 3. My Personal Skills, Attributes and Values 7-8 3.1. Skills 7 3.2. Attributes 7 3.3. Values 8 4. Which Job Do I Suit Better? 8 Contentsâ€Æ' 1. Introduction Two jobs that I have always been extremely interested in include, an early childhoodRead MoreAn Evaluation Will Be Deducted On The Health Inequalities Among Australians1689 Words   |  7 Pagesdeducted on the health inequalities among Australians. Secondly, a further evaluation to appraise and identify the causes, scope and impact on the health and well-being of [the] individual (s), families and community. Thirdly, describe the paradigms and accountabilities that Government and non-Government Organisations [NGO] assume across community services and health sectors to improve the health and wellbeing of Australians. Additionally, reviewing the over-all health and wellbeing issues from service-Read MoreMedical And Health Of Medicinal Protection1300 Words   |  6 Pages Medical And Health Medicinal and Health protections are presently extremely extravagant particularly with the regularly extending populace yet the purposes for the high costs have their reasons. Innovation is one element. The headways of innovation have extraordinarily contributed in the wellbeing protection industry and the expense for keeping up this innovation is high. Along these lines the expense of having this mechanical progressions and supplies are incorporated in regular expenses inRead MoreHealthy Eating Habits for Children 0-51697 Words   |  7 Pageseating habits early in life contributes to the lifelong wellbeing of children. â€Å"Between the ages of one and five, children grow and develop rapidly, so it’s really important that they get all the energy calories and other essential nutrients protein, vitamins and minerals that they need for healthy growth. Their appetite will vary too, so don’t force children to eat if they don’t want to† (â€Å"Health eating for children under 5,†Ã‚  2009, para.  5-7). In today’s modern society children spend more time eatingRead MoreThe Effects Of Physical Activities On The Human Body1572 Words   |  7 Pagesof regular physical activity. One of the major concerns of Americans’ today is to stay healthy. Because people are being threatened by several health issues that are creating problems making changes how people lives. Mostly the population suffers from health problems aggravated from unhealthy lifestyle and not doing enough physical activity. Among many health problems, the major ones that we face every day are cardiovascular diseases, obesity, mental issues, and diabetes etc. The physical activityRead MoreThe Code Of Welfare Act Essay1436 Words   |  6 Pagesstockperson/people are left to make a judgement on whether they are carrying out the animal welfare act appropriately, rather than it being prescribed. Within the minimum standards the stockperson/people are to make sure all Pigs physical health and behavioural wellbeing needs are met. New Zealand has a very small pig industry which only focuses on the domestic market , estimated at around 45,000 breeding sows are held and farmed in New Zealand. Producing roughly 70,000 pigs for slaughter each year. 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Each individual body is different therefore it can be difficult to perceive if they are healthy. By looking at a person you can see if they are in good physical health, that is, you can see if they areRead MoreThe Social Determinants of Health and Wellbeing1657 Words   |  7 PagesSocial Determinants of Health Wellbeing. In the last few years, nurses and other healthcare professionals (HCPs) are under the spotlight of the media and the public due to issues addressed in documents such as The Francis Report (2010). This is good in a sense though as it gives us the opportunity to better ourselves as HCPs and improve the standard of care for everyone. It is now a widely known idea that there are many different factors that affect our health and wellbeing not just biologicalRead MoreFighting Obesity Essay1209 Words   |  5 Pagesterm â€Å"obese† describes weight ranges that are above what is medically accepted as healthy. It occurs when you eat and drink more calories than you burn through exercise and normal daily activities. Your body stores these extra calories as fat. Obesity also has an affect on things other than your weight like: your energy, health, and economic wellbeing. Obesity has been increasing lately and, despite the many causes of it, the most standard are psychological, enviro nmental, and genetic. The most obvious

International Finance Science and Business Media

Question: Discuss about the case study International Finance for Science and Business Media. Answer: Introduction: Blades will have to incur $94500 if it uses the call option with exercise price of $0.00756 and $99000 for the call option with exercise price of $0.00792. It has to pay option premium of $1890 for the first option and $1417.5 for the second option. Therefore, the company has to bear total cost of ($94500+$1890) $96390 for the first option and ($99000+$1417.5) $100417.5 for the second option. Therefore, it can be stated that if Blades does not consider the future price then it should use the call option with the exercise price of $0.00756 to hedge its yen payables. On the other hand, The future price is expected to be lesser than both the exercise prices. Hence, if the company considers the future price for decision-making, it should go for the exercise price of $0.00792, as the loss on option premium will be lesser for this exercise price than the exercise price of $0.00765 (Jacque, 2013). The company may allow its yen position to be unhedged as the market forecasts exhibits that the future price will be lesser than both the exercise price. Moreover, yens future value was not affected by the uncertainty, caused by the recent event. Hence, it can purchase the supplies through future contract But it should be noted that the future prices are forecasted on part risk calculations and part assumptions. Therefore, it cannot be 100% accurate all the time. Moreover, as stated in the case study, the historical records shows that the yens value was highly volatile. Therefore, the company should hedge its yen payables to avoid the risk factors related to the foreign currency exchange (Kroencke et al., 2014). It is expected that the future purchase price of yen in dollar will fall from $0.0072 to $0.006912. It means that the value of yen is expected to increase in future. Therefore, the speculators, who attempt to capitalize the yens movement over 2 months, will surely become willing to buy yen now at the future spot rate. The more the speculators will buy yen at the specified spot rate, the more the demand of yen will increase, which, on turn, will create upward movement in the future value of yen. This practice will continue until the future value of yen become equal to $0.006912. The expected cost of the contract on the basis of various alternatives are calculated in the following chart:- Cost Analysis:- Call Option 1 Call Option 1 Particulars Future Contract Unhedged Option 1 Option 2 Option 1 Option 2 Total Exercise Price 0.00756 0.00792 0.00756 0.00792 Future Price/ Spot Rate 0.006912 0.006912 Option Premium 0.0001512 0.0001134 0.0001512 0.0001134 Total Unit 12500000 12500000 12500000 12500000 6250000 6250000 12500000 Cost of Contract 86400 86400 96390 100417.5 48195 50208.75 98403.75 Effective Contract Price 86400 86400 86400 86400 86400 Add : Loss for Option Premium 1890 1417.5 945 708.75 1653.75 Total Cost 86400 86400 88290 87817.5 88053.75 As per the calculations shown above, it can be stated that the future contract and the unhedged alternatives should be optimal choice of the company. The future contract options should be considered as the lowest cost alternative in terms of actual cost incurred for the company. The cost analysis, shown above, explains that the call options will cause more expense due to the payment of optional premium. The unhedged alternative will incur same cost as the future contract. But the risk factor in unhedging option is more than the future contract. Therefore, future contract alternative can be considered as the only option, which will incur lesser cost than the call options and includes lesser risk than the unhedging option (Menkhoff et al., 2012). If the yen value increases with the standard deviation by ($0.0005x2)$0.001 on the future spot rate, then the cost analysis of the contract will be as follows:- Cost Analysis:- Call Option 1 Call Option 1 Particulars Future Contract Unhedged Option 1 Option 2 Option 1 Option 2 Total Exercise Price 0.00756 0.00792 0.00756 0.00792 Future Price/ Spot Rate 0.006912 0.006912 Option Premium 0.0001512 0.0001134 0.0001512 0.0001134 Total Unit 12500000 12500000 12500000 12500000 6250000 6250000 12500000 Cost of Contract 86400 86400 96390 100417.5 48195 50208.75 98403.75 Future Price 0.006912 0.006912 0.006912 0.006912 0.006912 Add : Standard Deviation 0.001 0.001 0.001 0.001 0.001 Expected Future Price 0.007912 0.007912 0.007912 0.007912 0.007912 Total Unit 12500000 12500000 12500000 12500000 12500000 Expected Cost 98900 98900 98900 98900 98900 Effective Contract Value 98900 98900 96390 98900 98403.75 Add : Loss for Option Premium 1417.5 Total Cost 98900 98900 96390 100317.5 98403.75 The above table denotes that for the stated consequence, the best alternative of the company will be the call option with the exercise price of $0.00756,plus, option premium of $0.0001512. By exercising this option, the company can save almost $2500. The foreign exchange quotations are not appropriate. There is vast scope of earning profit from arbitraging due to the differences in the bidding and asking rates of the two banks (Singh, 2015). In the following table, it has been shown how the company can earn profit by arbitraging in the given scenario:- Calculation of Profit from Arbitraging :- Particulars Amount Investment in Arbitrage $100,000 Asking rate of MinZu Bank $0.0227 Baht Converted from Dollar 4405286.344 Bidding Rate of Sobat Bank $0.0228 Dollar Converted from Baht $100,440.53 Profit from Arbitage $440.53 The following table describes how the company can earn profit from triangular arbitrage due to differences in the cross exchange rate of dollar, thai baht and yen:- Calculation of Profit from Triangular Arbitraging :- Particulars Amount Investment in Arbitrage $100,000 Asking rate of Thai Baht $0.0227 Baht Converted from Dollar 4405286.344 Bidding Rate of Japanese Yen 2.69 Yen Converted from Baht 11,850,220.26 Bidding Rate of Dollar $0.0085 Dollar Converted from Baht $100,726.87 Profit from Arbitrage $726.87 The company can earn additional profit of $836 from covered arbitrage process. The calculation is presented in the following table:- Calculation of Profit by Investing in Foreign Market:- Paticulars Investment in Thai Money Market Investment in US Money Market Investment in Dollar $100,000.00 $100,000.00 Asking Rate for Thai Baht $0.0227 Dollar Convert into Thai Baht 4405286.34 Interest Rate 3.75% 2% Amount Received on Maturity 4570484.58 $102,000.00 Forward Rate $0.0225 Thai Baht converted into Dollar $102,835.90 Total Future Value of Investment $102,835.90 $102,000.00 Profit from Covered Arbitrage $835.90 The arbitrage opportunities use to disappear soon after they have been discovered due to the activities of the arbitrageurs. When the arbitrageurs use to purchase or sell more foreign currencies to capitalize the arbitrage opportunity, the supply and demand position of the foreign currencies also use to change accordingly and ultimately when supply demand of the currencies reaches to the equilibrium state the arbitrage opportunity disappears (Ranaldo,2012). For example, the covered interest arbitrage would create immediate demand for the Thai Baht, which, in turn, would create upward pressure on the spot rate of Thai Baht and the subsequent sale would create downward pressure on the forward rate of the currency. Thus, due the upward and downward pressures, when the spot rate and forward rate would become equal, then the interest arbitrage would not possible any more (Pasquariello, 2015). The equilibrium state is called as interest rate parity (IRP) Reference List: Jacque, L. L. (2013).Management and control of foreign exchange risk. Springer Science Business Media Kroencke, T. A., Schindler, F., Schrimpf, A. (2014). International diversification benefits with foreign exchange investment styles.Review of Finance,18(5), 1847-1883 Menkhoff, L., Sarno, L., Schmeling, M., Schrimpf, A. (2012). Carry trades and global foreign exchange volatility.The Journal of Finance,67(2), 681-718 Pasquariello, P. (2015). Government Intervention and Arbitrage.Ross School of Business Paper, (1240) Ranaldo, A. (2012). Limits to Arbitrage During the Crisis: Funding Liquidity Constraints and Covered Indterst Parity Singh, S. (2015). IMF, FOREX, and International Business in Emerging Markets. InThe Palgrave Handbook of Experiential Learning in International Business(pp. 714-729). Palgrave Macmillan UK