The Catcher in the Rye, a Medley of Failure - 825 Words

The Catcher in the Rye, a Medley of Failure All humans make mistakes, unfortunately, Holden Caulfield is notorious for committing one too many. J.D. Salinger’s The Catcher in the Rye appears to be a long string of consecutive failures for the protagonist. The novel describes his attempt to reconcile with these failures and find a path that suits his qualities and desires. However Holden can not find a way to succeed and even Mr. Antolini says, â€Å"This fall I think you’re riding for – it’s a special kind of fall, a horrible kind. The man falling isn’t permitted to feel or hear himself hit bottom. He just keeps falling and falling† (187). This whole fall that Holden is heading on seems to have started with the flunking out of school.†¦show more content†¦At this point in his life Holden is just confused and overwhelmed with growing up and having to enter adulthood. He is afraid of what he doesn’t understand and reverts to a c ynical view of society to shield himself from the painfulness of growing up. Holden wishes he could live in a simple and understandable world but he must face the realities of life and the complexities that come with it. Confronting failure is often the most difficult thing to do especially at a young age for adolescences, however education is able teach not only book work, but life values as well. By obtaining an education, Holden will be able to transgress his previous conceptions about society and learn to succeed in the rapidly changing society he is thrown

Development of Eating Disorders - 1218 Words

Much to our perceived attention is the idealised image that most aspire to have. In attempting to achieve such a look involves drastic measures for some and possibly fatal. There is ample of evidence to suggest that such measures revolve around an individual’s eating habits thus leading to unhealthy disordered eating patterns. Eating disorders refer to abnormal eating habits characterised by excessive or insufficient intake of food and develop from a number of interrelated issues. Much of the research into eating disorders has focused particularly on anorexia nervosa and bulimia nervosa and its developmental causes. Anorexia nervosa is a psychological disorder characterised by delusions of being overweight resulting in conspicuous†¦show more content†¦Also, despite its far-reaching nature, the media tends to conform and show one particular image to be correct, which is to be thin, whether it be celebrities or the presenters of a channel. In light of the evidence presented against the mass media in advocating unhealthy messages some critics argue that the media is not fully to blame. Although a positive correlation between media exposure and high levels of clinical eating disorders does exist, it does not fully justify or provide sufficient evidence for the case that the media is solely responsible for mediating unhealthy messages or negative connotations towards overweight people as most claim it to be. However, this argument follows if one watches too much television. There is the view that one may be more susceptible to another depending on the amount of television that they consume. Research shows that the alarming rates of young females wanting to achieve the ‘perfect body’ relies heavily on the amount of television they consume day in and day out. Emerging primarily in childhood, where children are exposed to a lot of television this attitude of the idealised image is carved throughout their developing life. Therefore, watching a particular body image from such a young age embeds the mentality that being thin is the right way to be. In response to the enormous level of exposure and pressure exhibited by the mass media it is apparent as to why many people are and remain highly displeasedShow MoreRelatedEffects Of Exercise Behaviors And Body Image And Eating Disorder Development1742 Words   |  7 Pagesphysical self-esteem on eating behaviors looks at one facet of this relationship. Exercise behaviors that will be looked at will take into account intensity of exercise, exercise frequency, and motivations for exercise. Self-esteem is multifaceted, but focusing on physical self-esteem pinpoints the physical appearance factors. Eating behaviors will be defined as the presence of significant eating disorder symptomology further detailed in the methods section. Eating disorder categories covered areRead More Parents Roles in Development of Eating Disorders: How Important is the Father?1561 Words   |  7 PagesParents Roles in Development of Eating Disorders Introduction Much of the literature that focuses on the parents role in the development of eating disorders is focused on the mother and the mother-daughter relationship. Studies have shown conclusively that a mothers body image and eating habits are, mirrored in her daughter, and that if she is obsessed with her own body image, it stands likely that her daughter will be the same way both growing up and in her adult life. The father, thoughRead More The Contribution of Social, Cultural, and Family Environment to the Development of Eating Disorders2053 Words   |  9 Pagescontribute to the development of eating disorders. Eating disorders have been found through centuries of doctors records. Some as far back as the seventeenth century through Morton (1694) descriptions of the symptoms of eating disorders during this period in time. Despite this eating disorders were only formally known as a disorder until 1980 when it was published in the DSM and more recent editions have shown that there are two different forms of eating disorders which are anorexiaRead MoreIndividual Psychology in the Real World809 Words   |  3 Pagesand physical disorders. Susan E. Belangee in her article â€Å"Couples and Eating Disorders: An Individual Psychology Approach† examines the factors that lead to eating disorders and how eating disorders affect adult intimate relationships through Adler’s personality theory. Belangee deems individual psychology as an effective approach to treating eating disorders. Examining eating disorders through individual psychology expands one’s understanding o f personality and how its development can lead toRead MoreEating Disorders are an Unhealthy Obsession1541 Words   |  6 PagesEating Disorders are a set of serious disorders with underlying psychiatric foundations. An eating disorder occurs when exercise, body weight and shape become an unhealthy obsession (Stein, Merrick, Latzer, 2011). People with eating disorders take physical concerns to the extremes that they take on abnormal eating habits. There are a variety of cases that lead to an eating disorder and can affect both men and women, however its prevalence primarily occur in adolescence (Ison Kent, 2010; SteinRead MoreEssay about Socio-Cultural Influences on Eating Disorders 1073 Words   |  5 Pagesproved says those with low self-esteem are most influenced by media. Media is not the only culprit behind eating disorders. However, that does not mean that they have no part in eating disorders. Media is omnipresent and challenging it can halt the constant pressure on people to be perfect (Bagley). Socio-cultural influences, like the false images of thin women have been researched to distort eating and cause un-satisfaction of an individual’s body. However, it is clear that, although virtually all womenRead MoreEating Disorders Are Affecting Adolescents With Increasing Frequency967 Words   |  4 PagesEating disorders are complex illnesses that are affecting adolescents with increasing frequency [1]. They rank as the third most common chronic illness in adolescent females, with an incidence of up to 5% 1, 2 and 3. Three major subgroups are recognized: a restrictive form in which food intake is severely limited (anorexia nervosa); a bulimic form in which binge-eating episodes are followed by attempts to minimize the effects of overeating via vomiting, catharsis, exercise, or fasting (bulimia nervosa);Read MoreTowards An Understanding Of Self Esteem And Eating Disorders1404 Words   |  6 PagesTowards an Understanding of Self-Esteem and Eating Disorders By Melissa H. Smith, Ph.D. | Submitted On September 24, 2012 Recommend Article Article Comments Print Article Share this article on Facebook Share this article on Twitter Share this article on Google+ Share this article on Linkedin Share this article on StumbleUpon Share this article on Delicious Share this article on Digg Share this article on Reddit Share this article on Pinterest Expert Author Melissa H. Smith, Ph.D. During aRead MoreSociocultural And Family Influences On Eating Disorders1372 Words   |  6 Pagessociocultural and family, that lead to the development of eating disorders. Neurology is a factor as disturbances to neurotransmitters and serotonin can affect brain activities that make an individual more susceptible to develop disordered behaviors associated with eating disorders. Genetics are also an important factor to eating disorders as they are inheritable and recessive in future generations. Personal, predisposed characteristics are another influence in eating disorders. Those who have self-esteem deficitsRead MoreThe Media s Influence On Eating Habits876 Words   |  4 Pagessociety, social identity, psychographic characteristics and mental illness all contribute to the development of disturbed eating habits from suppressing food to binge eating, especially in college-aged young adults. We seem to point our fingers at the media and society for a lot of the social issues in the world today. But is the media really to blame for disturbed eating behaviors that lead to eating disorders such as anorexia nervosa and bulimia nervosa? There has been quite a bit of research done in

Risk Management In Outsourcing And Impacts -Myassignmenthelp.Com

Question: Discuss About The Risk Management In Outsourcing And Impacts? Answer: Introduction A control system uses control loops to manage, command, direct and regulate the behavior of other devices. The operation of control systems used in management is based on the facts of the process variable being evaluated verses the desired set point (Neubert and Dyck 2016). The main feature of the control system is thereby, applying a control signal that returns the process output to the same value as the control signal. On the flipside, engineering control is explained as the psychology designs and modification to machines or plants to prevent hazards (Gooneratne and Hoque 2013. The processes that are involved in the engineering control processes are such as ventilation to reduce the risk of illness at the working place that is easier to manage. Control in management sense ismore difficult than engineering control because control in management incorporates numerous elements as compared to engineering control; the paper therefore, seeks to report on the reality of the this assertion. A control system has various elements that play specific roles to achieve a good control system. These elements when incorporated wellare profitable to the management system of an organization. They provide a set of rules that monitor the behaviors of employees in a company and automation processes that minimize the risks in operations.These elements include problem avoidance, feasibility constraints on the control choice, control of personnel, control of results and feedback. Effectiveness of control mechanism In many scenarios, the establishment of rules by the managing authority does not ultimately increase problem avoidance. Many employees are subject to error at work either knowingly or unknowingly. According to Gooneratne Hoque (2013), element of problem avoidance in the features of a managing control system is achievable by automation as one of the tactics. The use of computers and other means of automation machines for example robots aid in reducing the organizations problems. The machines are set to exact preciseness and accuracy to limit the errors that might have been caused by humans. The other alternative avoidance possibility is by centralization. This means that all the information processed by the managing authority is gathered and processed in one database. The information filed in a single database ensures fast and accurate retrieval of information in the organization. The existence of a database also reduces the tiresome workof information filling and additionally increases the accuracy of records keeping. Using a third-party company to manage the risks that might arise in the firm is also a way of problem avoidance (Hong et al. 2003). This mechanism uses insurance companies to cover the risks of accidents and perhaps employees behavior that might cause harm to the firm or to themselves. Finally, the other control mechanism in problem avoidance is elimination. This feature ensures that the manager or management of an organization can be advised to disinvest in a sector or subcontract a company that will manage a high prone risk sector in the organization. Control of results This type of control is mainly focused on results accountability. This control system holds employees responsible for the results retrieved. The use of the results accountability system requires that proper definitions of the dimensions of the expected results are set. These definitions include efficiency, quality, and service. The performance on these dimensions is also set to aid in the processes of the control of results (Viswanathan 2011). The control of result mechanism is set to reward and acknowledge the meeting of the required results and reparations are set on the results not meet to the set standard. Additionally, the result system is set based on future events and can work as a motivating factor to the employees. Control of Personnel Personnel control can be very effective in small organizations or even small family business. This type of control is effective in that it acknowledges the need of personnel in running of an organization and its processes. The running of personnel components is not difficult because there are minimal personal limitations with minimal task work whilst supporting even in lack of goal congruence (Schermann, Wiesche, and Helmut 2012). However, when the control problems are present, they can be curbed by altering the control of personnel by adjusting for example the hiring policy and initiating training programs to train employees. Control of Specific Actions This type of control is set to regulate people from doing specific actions. In most cases, the control type is set to prevent individuals from doing specific actions that might be termed as undesirable (Bembenek and Jankowska 2014). The management can therefore, use some behavioral constraints as a form of control to prevent and render some improper activities impossible. These constrains include the physical devices such as key-personnel identification systems, biometric locks and scanners and administrative constraints for example segregation of duties. Tracking of the employees behaviors and their engagements is also another method of control of specific actions. Depending on the settings of the systems limits, it can be set to reward or punish deviations from the specified limits. These action-accountability systems despite having been set to create consequences from unwanted behaviors and habits; they can also be used to motivate the employees to behave appropriately in the future (Daniel and Hiebl 2015). In addition, these systems can work if employees understand what is required of them and they have a drive that their individual actions will not go unnoticed and unrewarded. Pre-action review is another method of specific action control. This involves the viewing the work of others before completion or submission. These reviews are done through forms planning reviews, direct supervision, and approvals on proposals for expenditures (Reddick 2003). Reviews are effective in pre-action decisions such as correcting a potential harmful before it could develop into a real problem. It also influences the human behavior by influencing an extra care in the preparation of a proposal. Feasibility Constraints on the Choice of Controls The workability of the controls is determined by its design and how works. In most organizations, they depend on the employees to self-motivate themselves. This self-control and self-motivation can be achieved on most employees by the using of controls altered to suit hiring, training and screening (Tessier and Otley 2012). For control over specific actions, it might be difficult to provide the required set of requirements especially for behavioral aspects. This is because it is difficult to correctly define all the behavioral prospects unlike action-oriented aspects. To bridge these limitations, these behavioral actions are indirectly monitored using the number of working hours, sales made, or violations against proper procedure. Feedback is important when it comes to control systems. Feedback is a necessary reinforcement to back up the accountability of the systems. Feedback is however not used to make input adjustments but it signals that results and output is being monitored. Feedbacks provide the awareness of supervision through the feedback method. Feedback is also crucial in repetitive situation. It can be used to show indications of failure in systems. The feedback control system is also used to show when the results are achieved (Daniel and Hiebl 2015). Additionally, it can be used to make crucial interventions whereby results can be altered at different section processes. With input adjustments complimented by the feedback mechanism, it makes control management a powerful tool in an organization. The feedback mechanism can be manipulated to a powerful control loop switch. The feedback instead of now being result-oriented can be manipulated to specific-action oriented focus. For example, it can be set to away that after an action, when the feedback is positive the system automatically proceeds to the next step. On the other hand, when the results are not as intended the loop repeats itself until the desired results are acquired. Several scenarios are supported by the feedback method of control system to support business operations. All these cicumstances makes feedback method excellent for control systems. The feedback mechanism can be used to keep a retailer on the loop of his stock level. When integrated with the financial records it can be a useful tool to quantify when the levels of sales are highest and when they are lowest. Feedback control element is not always effective in all situations. For example, it is a useful tool when it comes to repetitive processes where the monitoring of situations is simple and after every stage. However, for the non-repetitive processes it is difficult to monitor the sources of errors and when feedback is given out it will be too late to reverse the process. There are various ways through which goals should be set in managerial control; his includes setting the performance standard, determining or measuring the actual performance, comparison of the actual performance, assessing deviation and taking the corrective actions. Setting the performance standard In order for an organization to achieve its objectives, it needs to formulate strategic goals. As much as all these goals governing the workmanship of the various organizational departments are important, a standard goal is the most relevant of all of these goals (Bucher 2013). It dictates how an organization moves forward despite all the challenges that come in the organizations way. Given the crucial significance of the standard goal, this section will come up with steps that can aid an organization in coming up with an effective and reliable standard goal. Researchers aver that the steps of coming up with the most appropriate standard goal are largely related to the life coach teachings. The first step in setting a standard goal in the context of managerial control is to exercise belief. Organizations need to believe that they can actually do indulge in the standard goal setting process successfully (Wright 2012). They are required to have faith in the process. Given the complication and the tiresome nature of this process, the team members need to be motivated throughout the entire process. Having a strong belief about attaining success eventually will enable them to remain enthusiastic throughout the process. After this belief has been created, the organizations team members can then move to the next step. The next step entails applying the SMART technique. Setting a standard goal that is specific enables the employees and especially those in the management control department to know exactly what they working on (Niven and Healy 2016). This increases their chances of succeeding. In order to aid the employees in staying on the right track, there is the need to ensure that the goal is measurable. In most cases, organizations end up setting up goals that are very hard to attain. Team members are encouraged to inquire into the certainty levels of attaining the proposed goal (Stevens et al. 2017). Having this in mind, organizations should probably look at their past successes and failure and the size of their business before they can decide if the proposed goal is attainable or not. Then of course, the goal should be relevant and time-related. The next step is to align the goals with the relevant department and in this case, management control. In the process of doing this, the organization needs to be aware that the employees could be having their own varied goals (Arraya, Pellissier, and Preto 2015). The organization should as such communicate its mandate to its employees in order to make sure that everyone is on the same page. The next step is to develop an action plan and finally, follow up on the execution of the standard goal and this constitutes the reward. Indicating the performance standard is considered, as the first step is management control. These standards are often considered by Iles and KaurHayers (2014) as the basis for determining the actual performance. Moreover, Mthieu (2013) argue that standards are the benchmarks through which the efforts of the whole organization are directed to. Such standards could be dieted both through qualitative and quantitative terms. There are various examples of the qualitative data including, the cost that is to be incurred, the revenue earned as well as the units to be produced and sold, time to be spent, the level of inventories to be maintained etc. On the contrary, Von Glinow (2016) argues that the quantitative standards include improving the good will, improving the quality of products, and enhancing labor relations. To facilitate easy comparison of actual performance with standards, the managers should attempt to set such standards in qualitative forms. Measuring the actual performance After determining the standards, it is significant to measure the actual performance. There significant levels of measuring performance including using performance report, sample checking, personal observation among others. Arguably, Mthieu (2013) provides that in order to facilitate easy comparison, performance should be measured in on a similar basis that the standards have. Comparing the standards with the actual performance This often involves the actual performance with the standards that are laid down to determine the deviations. For instance, the performance of a sales man in terms of units that are sold in a week could easily get measured against the standard output for each week. Assessing the deviations A number of deviations are often possible in every activity. On the contrary, deviations in significant areas of business should be corrected much urgently when compared to deviations in significant areas. Management should therefore use vital point control as well as management by exception in such areas. As far as critical control is concerned, it is important to focus on key areas that behave as critical points. As asserted by Lagerstroem (2014), the KRA is crucial for an organization success. Therefore the whole organization has to suffer if at all something goes wrong at this point. For instance, while analyzing the manufacturing organization, cost is considered as being much troublesome relative to 18 percent increases in the stationary expenses. While focusing on management by expectation, Kozlowski (2013) provides that only the significant deviations would exceed the limits that have been prescribed. Taking corrective action The last step when it comes to setting standards in management control entails taking the corrective actions. If deviations are considered to be within the acceptable limits, it is worth noting that no corrective actions are required. Contrary, if deviations tend to exceed the acceptable limits, they should be brought immediately to the notice of the management in order to undertake corrective measures in significant areas. Proactive and reactive control Proactive and reactive control plans are both strategies of dealing with problems affecting business organizations and organizations as a whole. These two methods are the exact opposite of each other. They cancel out on each other. Management control largely involves dealing with problems affecting organizations. Proactive control on its own largely applies the ideologies of preventive measures (Duthooet al. 2014). This plan constitutes finding the identifying the source of the problem and as the initial strategy. After the problem has been identified, the next step is to identify the various ways in which this problem can be tackled. Proactive control is not exactly the best strategy to deploy in dealing with managerial problems. To begin with, it is more complicated than its sister did strategy, reactive control. On top of this, if say an organization was facing negative media publicity or unfair competition, employing proactive, employing proactive methods will give the opponents the advantage of predicting the organizations next move. Proactive methods involve down strategies even before the problem actually occurs (Xuet al. 2016). If the opponents were to take advantage of this, they would just come up with ways of going back on these strategies. This implies that deployment of proactive methods will still result to the organization suffering the consequences of harm. Reactive methods on the other hand as the name suggest, involve countering problems immediately they arise. This is a good strategy especially in the case when the organization is going through new problems that it has never encountered before. By giving the opponents a chance to attack and execute their strategies against the organization, the organization has the advantage of uncertainty on the side of the opponents (Gonthier, Braver, and Bugg 2016). The attackers will not have any glimpse of what the organization is planning to do as its counter attack measure. This will in turn give the organization the opportunity to identify the feints and bluffs in the attack strategies executed by the opponents. As compared to proactive methods, reactive control techniques are easier to execute and they bring out better results. Requisite Variety Requisite variety involves coming up with numerous solution plans for a single problem immediately it manifests itself. For instance, the management control of an organization can apply both proactive and reactive methods in dealing with the identified problem. The concept of requisite variety can perhaps be considered as the best way to deal with the problems that affect an organization (Martineau, Johnson, and Pauchant 2017). Modern trends in effective organization management and control require that organizations have numerous solutions to the problems affecting their various departments. It is not always a guarantee that a given method will work out perfectly well in dealing with a problem. As such, organizations may find it necessary to have some sort of a backup plan. The backup plan in this case involves having a variety of solutions. If one solution fails, the organization will go ahead and apply the next one. Alternatively, the organization can just go ahead and apply multip ly solutions at once. Conclusion In summary, control systems are useful tools in management. With the various elements working together, controls are powerful to manipulate management to fewer errors with limitless number of other advantages. The control over results is faced with difficulty for pointing out the desired. For example, the customer service complaints might post a positive review for the target hotel. The feasibility of the controls allows the determination of the desired results with its set of programs set. Additionally, controls can be manipulated to integrate more elements within it thereby giving it unlimited access for more improvements on work efficiency. List of References Arraya, M. A., Pellissier, R., Preto, I. 2015, Team goal setting involves more than only goal setting. Sport, Business and Management, 5(2), 157-174. Bembenek B. and Jankowska.2014, Strategic decision making within the cluster in the context of organizational entrepreneurship.Economic and social development: Book of proceedings; Varazdin 425-433. Bucher, C.W. 2013, Measuring leader's goal setting operations, Marian University. Daniel S., and Hiebl M. 2015, Management accounting and management control in Family business: Past accomplishments and future opportunities. Journal of Accounting Organizational Change; Bradford 11.4: 573-606 Duthoo, W., Abrahamse, E.L., Braem, S. Notebaert, W. 2014, "Going, going, gone? Proactive control prevents the congruency sequence effect from rapid decay", Psychological research, vol. 78, no. 4, pp. 483-93. Gonthier, C., Braver, T.S. Bugg, J.M. 2016, "Dissociating proactive and reactive control in the Stroop task", Memory cognition, vol. 44, no. 5, pp. 778-788. Gooneratne T. and Hoque Z. 2013, Management control research in the banking sector.Qualitative Research in Accounting and management; Bradford 10.2 pp 144-171. Graham, J.F. 2012, Same Goal, Different Day: The Moderating Effect of Experience on the Goal Difficulty - Performance Relationship in a Repetitive Goal Setting Environment, St. Ambrose University. Hong, C., et al. 2003,An integrated system theory of nformation security management.Information Management compoter security; Bradford 11.5. Iles, P., KaurHayers, P. 2014, Managing diversity in transnational project teams: A tentative model and case study. Journal of managerial Psychology, 12(2), pp.95-117. Kozlowski, S.W.J. 2013. A typology of virtual teams: Implications for effective leadership. Group and Organization Management, 21(1), pp.14-49. Lagerstroem, K. 2014,The development and sharing of knowledge by centres of excellence and transnational teams: A conceptual framework. Management International Review, 48(3), pp.319-338. Martineau, J.T., Johnson, K.J. Pauchant, T.C. 2017, "The Pluralist Theory of Ethics Programs Orientations and Ideologies: An Empirical Study Anchored in Requisite Variety", Journal of Business Ethics, vol. 142, no. 4, pp. 791-815. Mthieu, J. 2013,Leading parallel global virtual teams: Lessons from Alcoa. Organizational Dynamics, 38(3), pp.204216. Neubert M. and Dyck B. 2016, Developing sustainable management theory: goal-setting theory based in virtue. Management Decision; London 304-320. Niven, K. Healy, C. 2016, "Susceptibility to the 'Dark Side' of Goal-Setting: Does Moral Justification Influence the Effect of Goals on Unethical Behavior?"Journal of Business Ethics, vol. 137, no. 1, pp. 115-127. Reddick C. 2003, Budgetary decision making in the twentieth century: Theories and evidence. Journal of Public budgeting, Accounting Financial management Boca Raton pp251. Schermann M., Wiesche M. and Helmut K. 2012,The role of Information Systems in supporting Exploitative and Explanatory Management Control Activities. Journal of management accounting research; Sarasota 31-59. Stevens, A., Koke, A., Trudy van, d.W. Beurskens, A. 2017, "Ready for goal setting? Process evaluation of a patient-specific goal-setting method in physiotherapy", BMC Health Services Research, vol. 17. Tessier S. and Otley D. 2012,From management controls to the management of controls.Accounting, Auditing accountability Journal; Bradford. Wright, P.L. 2012, Goal setting theory: A macro study, Dallas Baptist University. Viswanathan S. 2011, The practice of risk management in outsourcing and its impacts: An empirical investigation. Michigan state University publishing. Von Glinow, M. 2002, Transnational teams in the electronic age: are team identity and high performance at risk?Journal of Organizational Behavior, 23; pp.455-467. Xu, M., Li, Z., Fan, L., Sun, L., Ding, C., Li, L. Yang, D. 2016, "Dissociable effects of fear and disgust in proactive and reactive inhibition", Motivation and Emotion, vol. 40, no. 2, pp. 334-342.

Time Value of Money and Present Value Essay Example

Time Value of Money and Present Value Paper Date: 14/11/2012 52. Annuities: You are saving for the college education of your two children. They are two years apart in age; one will begin college 15 years from today and the other will begin 17 years from today. You estimate your children’s college expenses to be $23,000 per year per child, payable at the beginning of each school year. The annual interest rate is 5. 5 percent. How much money must you deposit in account each year to fund your children’s education? Your deposits begin one year from today. You will make your last deposit when your oldest child enters college. Assume four years of college Solution: Cost of 1 year at university = 23,000 N=4 I=5. 5% PMT=23,000 CPT PV = 80,618. 45 For the first child the PV = 80,618. 45/ (1. 055) ^14 = $38,097. 81 For the second child the PV = 80,618. 45/ (1. 055) ^16 = $34,229. 07 Therefore the total cost today of your children’s college expense will be the addition of the 2 = $72,326. 88 This is the present value of my annual savings, which are an annuity, so to get the amount I am supposed to save each year would be: PV=72,326. 88 N=15 I=5. 5 CPT PMT = 7,205. 6 57. Calculating Annuity Values: Bilbo Baggins wants to save money to meet three objectives. First, he would like to be able to retire 30 years from now with retirement income of $25,000 per month for 20 years, with the first payment received 30 years and 1 month from now. Second, he would like to purchase a cabin in Rivendell in 10 years at an estimated cost of $350,000. Third, after he passes on at the end of the 20 years of withdrawals, he would like to leave an inheritance of $750,000 to his nephew Frodo. He can afford to save $2,100 per month for the next 10 years. If he can earn an 11 percent EAR before he retires and an 8 percent EAR after he retires, how much will he have to save each month in years 11 through 30? Solution: We will write a custom essay sample on Time Value of Money and Present Value specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Time Value of Money and Present Value specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Time Value of Money and Present Value specifically for you FOR ONLY $16.38 $13.9/page Hire Writer First we get the FV of the 2,100 savings over 10 years Bilbo Baggins can afford to save $2,100 dollars per month for the next 10 years therefore at 10 years he would have saved: PMT = 2,100 I = 10. 48 / 12 = 0. 873 N = 10 x 12 = 120 CPT FV = $442,201. 15 So after 10 years he would be able to purchase his yacht at the price of $350,000, and he would be left with a balance of $92,201. 15 This $92,201. 15 will be our current PV at year 10. At year 30, the year when Bilbo retires, the $92,201. 15 would become 92,201. 15*(1. 11) ^20 = $620,283. 23 Second we have to find out how much the inheritance of 750,000 would be at year 30: 750,000/1. 8^20= $160,911. 16 Third In order for him to be able to withdraw a sum of 25,000 per month for the next 20 years after his retirement, we should now calculate this annuity’s present value: N= 20 x 12 = 240 I= 7. 72 / 12 = 0. 643 PMT= 25,000 CPT PV = $3,052,135. 26 Adding up the PV’s of the $750,000 and the annuity, we will get $3,213,046. 32 We will subtract the future value at year 30 of the $92,201. 15 ($620,283. 23) which we saved at year 10 from $3,213,046. 32 to get $2,592,763. 09 We are now left with an annuity that pays $2,592,763. 09 at year 30, and a time period of 20 years (yr11-30) To calculate the yearly PMT, we have FV= $2,592,763. 09 I= 10. 48 / 12 = 0. 873 N= 20 x 12 = 240 CPT PMT = 3,207. 33 Therefore the monthly PMT Bilbo would have to save each month through years 11-30 would be = $3,207. 33 34. Valuing bonds: Mallory Corporation has two different bonds, currently outstanding. Bond M has a face value of $20,000 and matures in twenty years. The bond makes no payments for the first six years, then pays $1,200 every 6 months over the subsequent eight years, and finally pays $1,500 every 6 months over the last years. Bond N also has a face value of $20,000 and a maturity of 20 years; it makes n coupon payments over the life of the bond. If the required return on both these bonds is 10% compounded semiannually, what is the current price of bond M? Of bond N? Solution: The price of a bond is equal to PV of expected future cash flows Bond M: Face value 20,000 Present value of 20,000 = 20,000/ (1. 05) ^40 = $2,840. 91 First we need to get the present value of the annuity for the 1,500 semiannual PMTs at year 14 Present Value of Annuity = $13,295 $13,295 becomes $3,391 at year 0 We then get the annuity of the 1,200 semiannual PMTs at year 6, and then at Present Value $13,005 at year 6 with a PV of $7,242 at year 0 The sum of the 3 PV’s gives us the value of the bond ,841 + 3,391 + 7,242 = $13,474 Bond N Face value 20,000 Present value of 20,000 = 20,000/ (1. 05) ^40 = $2,840. 91 38. Non-constant growth: Storico Co. just paid a dividend of aud 3. 5 per share. The company will increase its dividend by 20% next year, and will then reduce its dividend growth rate by 5% per year, until it reaches the industry average o f 5% industry average growth, after which the company will keep a constant growth rate forever. If the required return on Storico stock is 13%, what will a share of stock sell for today? Solution  : D0 = $3. 5 D1= 3. 5*1. 2= $4. 2 D2= 4. 2*1. 15= $4. 3 D3=4. 83*1. 1= $5. 31 D4=5. 31*1. 05= $5. 58 Since the first 4 periods are different we get the PV of each one alone, then as of the 4th year we get the perpetuity of the rest, and sum them up to get the final NPV We now get the PV of each Dividend PV D1 = 4. 2/ (1. 13) = $3. 72 PV D2 = 4. 83/ (1. 13) ^2 = $3. 78 PV D3 = 5. 31/ (1. 13) ^3 = $3. 68 So the PVs of D1+D2+D3 = $11. 18 NPV of perpetuity at constant growth = 5. 58(0. 08) / (1. 13) ^3 = 69. 75 / (1. 13) ^3 = $48. 34 NPV perpetuity + NPV dividends = NPV price of stock today 48. 34 + 11. 18 = $59. 52