Miller and Modigliani Essay Example | Topics and Well Written Essays - 750 words

Miller and Modigliani - Essay Example The higher the company is able to retain earnings, the lesser the dividends and the lower the retention, the larger the dividends. Finance managers then need to make a wise decision on dividends payments and investment fuelling funds from the net profit of the firm. Since the overall goal of doing business is profit maximization, organizations must know which of the two practices is better in terms of wealth creation. If it will not lead to wealth creation for the shareholders, the funds should be retained to support investment programmes. A conflict therefore arises on whether dividends payment impacts the value of the organization or not. Some critics argue that dividends are irrelevant in that the percentage paid to the shareholders does not impact the value of the business while others maintain that dividends are relevant as far as the value of the organization is concerned (Baker,2009). Modigliani and Miller Hypothesis (MM Hypothesis) Both are on the idea that dividends are irre levant in that they have no effect on the organization’s value and do not have serious repercussions on the firm. According to them, choosing an investment programme that will contribute to the firm’s profit is what is important in adding value to the business. The process of dividends sharing is less important. In the event of good markets, realistic investments, and proper tax allocation between dividend revenue and business capital, provided the organization’s investment programme, dividend sharing has no effect on the market price of shares. Their theory on irrelevance of dividends is grounded on the following assumptions; First is that the business is conducted in an environment of perfect capital markets characterized by availability of sufficient and free information at all times, no or less exchange expenses and realistic investments. The investors are not a threat to the market price of goods and services. Also the investors are assumed to be realistic, implying that the main and only goal of shareholders is wealth maximization without discriminations on dividends sharing. They need to be satisfied with the amount that they get from the shares. Modigliani and Miller assumed that tax is ‘non-existent’. Therefore there should be no tax disparities such that the tax levied on dividend is not the same with that of the earnings. If there is tax, it should be equal. The idea is to provide a differentiation between revenue from dividends and from capital earnings. Again, the investment programmes of the organization are assumed to be consistent, i.e. they do not change constantly. The investors most also be in a position to make an intelligent guess about future investment programmes and how much profit they will generate (Frankfurter, wood & wansley, 2003). The argument’s bone of contention is that provided the firm’s investment decision, it can keep its revenue for financing investment programmes or distribut e the profit to the shareholders. The market share increases from the payment of dividends while other added shares pose a drop in the value of shares. This means that the market price does not change with dividends payment. The external business support is said to affect the dividend payment on the wealth of shareholders which makes them indifferent in deciding between dividends and keeping the firm’s revenue to channel investment programmes. In this view, the business external support that is said to affect dividends payment fails to capture mm’s hypothesis of dividends irrelevance. If dividends were irrelevant, the organization’s capital expenses would rely on their rate of dividend distribution (Banarjee, 1990). The assumption on perfect capital m

Knowledge Management and Organisation Learning Essay

Knowledge Management and Organisation Learning - Essay Example Modern business history lists a number of instances when knowledge-centred management has helped create competitive advantage of organisations and even countries formerly limited in financial and other resources. For Microsoft, Dell, IBM (which is believed to be one of the founders of the paradigm), Compaq, British Airways, Ryan Air and other major organisations knowledge management has become the cornerstone of success. The same is true for such countries as South Korea, Singapore, Malaysia and Hong Kong which rely on the national knowledge economy. Over the last two decades, organizations have often been described in terms of knowledge and learning with the help of such concepts as "learning organisation", "intellectual capital", "people-centred approach" or "knowledge based management". Cakar and Bititci (2001) perfectly summarise this trend in the following statement: "1980s were all about automation. In the manufacturing industry FMS, FAS, Robots, AGV'S etc. were commonplace. The 1990s have been about people, this is evident in the development of concepts throughout the 90's focusing on delegation, involvement, ownership cross functional teamwork, self managed works teams and so on The needs of modern business emphasize the role and importance of people and knowledge" (p.2). Also the idea of knowledge management appeared requested in 1990s the concept itself dates back early 1960s. Its advent is associated with classic works of Peter Drucker w. Drucker found out that on 1960s, He called this new era an informational one (Drucker, 1994). The ideas of Peter Drucker (1994), whom was the first to use term 'knowledge worker', became widely recognised in 1980s when a number of followers supported his idea that investments in human resources were increasingly becoming more cost-efficient than investments in machines. In 1986, European knowledge management pioneer Karl-Erik Sveiby described the concept of a "know-how company" (Doz, Santos & Williamson, 2001), and in 1991 the ideas of knowledge management were reconsidered by Ikujiro Nonako whom presented the idea of "knowledge-creating company". The 1996 could be considered the turning point in history of knowledge management: the influence of this paradigm became overwhelming in absolute majority of the developed countries (Skyrme, 2002). The ideas and concepts related to knowledge managements were successfully applied in the oil, pharmaceutical, high technology, financial, and other industries. Main Body Knowledge management is a new form of management which helps organizational adaptation, survival and competence in face of increasingly discontinuous environmental change. This broader perspective incorporates the processes of knowledge use, knowledge creation, knowledge sharing, knowledge transfer and knowledge renewal (Malhotra, 1998). Therefore, knowledge management is commonly defined as "the explicit and systematic management of vital knowledge and its associated processes of creating, gathering, organizing, diffusion, use and exploitation, in pursuit of

Stem Cells Research Paper Example | Topics and Well Written Essays - 1250 words

Stem Cells - Research Paper Example Stem Cells The most important characteristic of stem cells is the potential to transform into different types of cells. Besides, stem cells can perform the role of a repair system within human body. Within this scenario, Embryonic Stem Cells are generally used for regenerative medical purposes. On the other side, Adult Stem Cells are helpful for the treatment of deadly diseases generally noticed among human beings. The Induced Pluripotent Stem Cells are used for research purposes, aiming to develop proper medication for deadly diseases. So, one can see that the scientific research related to stem cells can solve some of the health problems faced by human beings in general. Thesis statement: The stem cells like Embryonic Stem Cells (ESC), Adult Stem Cells (ASC), and Induced Pluripotent Stem Cells (iPSC) are helpful to develop medicines and proper remedy for deadly diseases, especially like bone-marrow transplantation for blood cancer. Stem cell types This section is broadly divided in to: Embryonic Stem Cells, Adult Stem Cells, and The Induced Pluripotent Stem Cells. Embryonic Stem Cells These stem cells are developed from human embryos, especially from the inner parts of embryos undergoing the process of growth. Crocker (2008) states that, â€Å"Stem cells, both embryonic and adult, could be used to replace damaged tissue in several ways† (p.6). To be specific, these cells within this stage of growth can be used for tissue transplantation and similar medical uses. But these cells cannot be simply injected into human bodies because the same may develop into unexpected tumors. Besides, some human bodies may reject this type of stem cells and scientists are working hard to find out an apt solution for this problem. Still, these stem cells can be used for regenerative medication purposes. On the other side, one can see that the research work related to these stem cells provide hope to humanity because the same was successfully used in the year 2010 among the victims of spinal injury. In short, further research within this field may prove importance of this stem cell because research work related to the same is undergoing gradual progress. Adult Stem Cells These stem cells are generally used for research and treatment purposes. In addition, the research on this type of stem cells attracts less criticism because it is not produced from embryos. Zyl (2009) states that, â€Å"Some physicians and scientists believe that adult stem cells are not as versatile or effective as embryonic stem cells, while others have shown that adult stem cells are highly effective against most major diseases† (p. xiii). As these stem cells are collected from adults, there is less risk because rejection related to human immunity is out of focus. Besides, medical treatment related to these stem cells proves to be successful because the same is used for the treatment of leukaemia and other diseases. Still, further research can unveil the future scope of this type of stem cells within the context of medical treatment. So, one can see that the research related to this type of stem cells show rapid progress and is helpful to fight some deadly diseases. The Induced Pluripotent Stem Cells The IP stem cells are developed by scientists by reprogramming the same to acquire the main characteristics of ES cells. To be specific, this stem cell is important within the scenario of stem cell research, especially in

Plato, three Socratic Dialogues Essay Example | Topics and Well Written Essays - 500 words

Plato, three Socratic Dialogues - Essay Example Euthyphro is aghast that a wise man like Socrates is being tried for corrupting the young ones and tells him that people do not like others to spread wisdom and are jealous of people who are wise. The two start talking and in the ensuing dialogues Socrates asks Euthyphro to explain the concept of piety. Euthyphro replies that piety is fighting for justice as he is doing by prosecuting his father for a murder. He laments the fact that he is hated for his action by the people although those very people have high regards for Zeus, the king of Gods, even though Zeus had punished his father (Kronos) for devouring his sons! When further pressed for the definition of piety, Euthyphro tells Socrates that whatever is held dear to God is pious and what is not dear to God is impious. He further said that even Gods have enmities and differences. Socrates counters that argument by telling that what may be liked by one God may not necessarily true for another God. Hence difference of opinion may account for the enmities and hatred between Gods and people. He asserts that everyone likes just and honourable things or persons and dislike the opposite. But it is the difference of opinions that brings about enmities and hatred. When Socrates is still not satisfied with the definition of piety, Euthyphro finally says that everything that Gods love is pious and holy and the things or persons they hate is impious and unholy. Socrates confused Euthyphro by questioning whether Gods loved things because they were pious or things were pious because Gods loved them? The dialogues, in the form of questions and answers, between the two are especially relevant even today because they establish the credibility of questions as an important means to reach towards a correct and justified answer. In simple words, the questions make us thinks about the different aspects of the problems and help us to come to a right conclusion. Socrates was a great philosopher who