Construction sector of India is an integral part of the economy

Construction sector of India is an integral part of the economy Introduction Construction sector of India is an integral part of the economy and is progressing on account of urbanization, industrialization, economic development and peoples soaring expectations for improved quality of living. Between 2004-05 and 2008-09 average real growth has been an impressive 12.28% year-on-year (y-o-y), which reflects the countrys immense need for continued investment in transport infrastructure, electricity generating capacity and housing, as well as the build-up of industrial capacity (BMI, 2010). Segmentation of Construction Industry The Indian Construction Industry can be divided into residential segment generating 85.8% of the total revenues and the non-residential building segment that generates 14.2% of the industrys value (Data Monitor, May 2009). (APPENDIX 1) Real Estate à ¢Ã¢â€š ¬Ã‚ ¢ Corporate à ¢Ã¢â€š ¬Ã‚ ¢ Industrial à ¢Ã¢â€š ¬Ã‚ ¢ Residential à ¢Ã¢â€š ¬Ã‚ ¢ Commercial (APPENDIX 2) Infrastructure à ¢Ã¢â€š ¬Ã‚ ¢ Roads à ¢Ã¢â€š ¬Ã‚ ¢ Urban infrastructure à ¢Ã¢â€š ¬Ã‚ ¢ Railways à ¢Ã¢â€š ¬Ã‚ ¢ Airport Porters Five Forces Threat of New Entrants Bargaining Power of Suppliers Bargaining Power of Customers Competitive Rivalry within the Industry Threat of Substitutes Bargaining Power of Suppliers Indian construction industry consists of two categories of suppliers, those providing construction materials and those who provide constructional services like electrical installation In India there are many small players in the construction material manufacturing industry, which weakens the supplier power (Data Monitor, May 2009). The subcontractors who provide constructional services are in a weak position due to the existence of many small operators. Overall, supplier power in this industry is moderate. Bargaining Power of Buyers Buyers in this industry are few and large such as government agencies or other major organizations, rather than individuals. The presence of low costs along with the strong price sensitivity of demand strengthens buyer power in the industry. Also the buyers are rarely capable of integrating backwards and take over the practicalities of the project themselves thereby proving that the buyer power in this industry is moderate (IICCI, 2008). Threat to New Entrants The governments recent liberalization of the rules governing foreign companies entering the Indian industry has boosted the entry of new players. Since a very small amount of capital is adequate to enter this industry and the contractors can reduce their costs by renting rather than buying equipment, the labor market is extremely elastic. Overall, the threat of new entrants to the industry is strong. Threat of Substitutes The threat of substitutes in this industry is very weak as it is unlikely that any alternative expenditure would be satisfactory for a buyer even if he has the requisite funds for a new construction project. Even if buyers have the option of renovating an existing structure rather than investing in a new construction, players in the construction and engineering industry remain likely to be involved. Competitive Rivalry within the Industry The atmosphere of a secure growth within the Indian construction industry eases rivalry by creating space for expansion. The low capital cost of market entry translates into low sunk costs reducing the exit barriers. Thus the rivalry is considered to be moderate (Data Monitor, May 2009). Key Players in Construction Industry Larsen Toubro Limited (LT) is one of the largest and most respected technology, engineering, construction and manufacturing companies of India. Jaiprakash Associates Jaiprakash Associates Limited principally provides civil engineering and construction services primarily in India. They earned a revenue of about 65000 US $ in the year 2010. (Business Wire, November 2006) Hindustan Construction Company HCC is one of the leading construction companies of India having built several landmark projects in Indias Hydro Power and water resources sector (Sandeep Sawant, Sept. 2007). Gammon India It is the only Indian Construction Company to have been accredited with ISO 9001 certification for all fields of Civil Engineering Works. Gammon employs expertise who has proved their innovative skills in India and abroad PESTLE Analysis of Construction Industry Source: http://www.whatmakesagoodleader.com/macro-environment-analysis.html Political Factors SEZ Act Special Economic Zone is the new target for real estate investors. As of date there are 105 approved SEZs in India (General Knowledge Today, Feb 2010). Laws governing these zones are more liberal in nature than the centralized laws and enhance a countrys technology growth, infrastructure and economic development. FDI Liberalisation The government of India has permitted a Foreign Direct Investment of 100 % for development of townships in India. India is now 2nd most preferred country for FDI after China. Opening of FDI in construction and allowing developers to raise capital in international markets has led to development of larger projects (Mohit Saraf, July 2009). Impact of REITs The introduction of Real Estate Mutual fund (REMF) and Real Estate Investment Trust (REIT) has boosted real estate investments from the small investors aspect. Economic Factors Gross Domestic Product (GDP) Growth India is witnessing tremendous growth and expansion of construction activities and construction is the largest component of GDP. It has been growing at a rate over 10 % in the past few years when GDP was around 8% (Farook Azam, 2010). (APPENDIX 3) Source: IHS Global Insight Change in Demand Changes in the demand due to factors like changes in disposable income of perspective buyers and inflation may affect the construction industry. With the easy availability of housing loans and tax redemption on loans the demand for houses is increasing and thus construction is gaining weight. Fluctuations in Prices of Inputs Many builders tend to stop work when the prices of inputs like cement, iron etc go up and wait till the prices come down. This leads to unnecessary delay in the work and the cost of wasting time would actually be more than the increase in price (Arghadeep Laskar and C. V. R. Murty, 2003). Social Factors Goodwill of the Company Brand name of a builder or the company plays an important role in convincing the buyer to buy the house and be sure of the quality of construction work done. A low credibility or image can lead to poor financial performance. Green Buildings A green building is one which uses less water, optimises energy efficiency, conserves natural resources, generates less waste and provides healthier spaces for occupants, as compared to conventional building (India Today, Vol. 34, Issues 1-8). The estimated market potential for green building was about $ 400 million in 2010 and is increasing continuously. Technological Factors Upgrading of Technology Use of low grade technology in the construction sector leads to low value addition and low productivity apart from sub standard quality of construction and time over runs in projects. Due to lack of technology, construction can suffer in terms of quality and design. Source: managingthedragon.com Ready Mix Concrete The business of ready mix concrete in India is in its infancy. Indian ready mix concrete business uses only 2% of the total cement production. The increasing use of ready mix saves time and allows better quality too. Legal Factors The National Housing Policy NHP (1998) was formulated to address the issue of sustainable development of infrastructure. The Government helps to provide fiscal concession to carry out legal and regulatory reforms and create and enabling environment for the construction industry (P.R. Swarup, Director General, Construction Industry Development Council, India). Environmental Factors Uncertain Calamities Uncertain environmental hazards like earthquakes, floods etc. have a disastrous impact on the construction industry and can delay construction as well. This has been witnessed during the construction of the Metro line in the capital of India, New Delhi where one of the railway lines being constructed collapsed due to heavy rainfall and delayed the total completion time of metro. Structural Drivers of Change Globalization After the policy of globalization being introduced in 1990s, the private companies started being more aware about construction products and there was inflow of construction based knowledge and technology from other countries to ours changing thinking towards the whole construction scenario. Import and export procedures, customs and excise laws and ease in operations of foreign accounts minimized controls on industry and rapid growth took place. Due to simplified single window clearance import export procedures became easier thereby allowing Indian construction Industry to compete in overseas market (Accommodation Times, 2009). Technological Developments A key driver of transformation for the Indian construction industry is technological change. Global telephony, satellite communications and video links are now widely available (Shakantu, 2000). Information and communication technology (ICT) is significantly influencing technological change (CIRIA, DTER, 1999). Simulations of entire construction processes and systems can be developed to determine the optimal approach to achieving desired performance (Shakantu, 2000; Fisher, 1993; Coyle, 1996). Changes in Government Policy The government policies helped in boosting the real estate sector by substantial cutting interest rates and facilitating greater ease in credit. Recent excise duty cuts on cement and steel also reduced the construction costs. These recent government initiatives increased liquidity in the market and brought down the interest rates to a more realistic level. Life Cycle of Construction Industry The Indian construction industry is in its growth stage growing at over 20% over the past 5 years. It has witnessed a revolution, driven by the booming economy, favorable demographics and liberalized foreign direct investment (FDI) regime (World Market Intelligence, March 2010). We can say that the sector has been performing quite well over the past decade. Despite the depressing global scenario, the Indian market was protected from the effects, as the economy as was more robust than its counterparts. The pace of private construction slowed down but remained positive. With the growing capital inflow within India and from abroad the demand for infrastructure is likely to increase. The Indian government has been a major investor in this sector in order to stimulate the development of construction industry to the requisite level required to achieve the next growth target. (K.V.S.S., Narayana Rao, 2009). Although steady progress through the construction industry is not inevitable, the life cycle concept does none the less remind construction companies that conditions will change over time. ( Johnson, Scholes Whittington, 2008) (APPENDIX 4) In 2013, the Indian construction and engineering industry is forecast to have a value of $55.3 billion, an increase of 44% since 2008. Future Scenarios for Construction Industry Scenario 1 New Equipment, Technology and Materials Involvement of Indian consultants in international projects has led to blend of new materials, equipment and technologies in the construction practices of India. Very soon the growing demand for such advanced equipment will force the builders to manufacture these as well. The government has also taken some remarkable initiatives to ensure that its basic infrastructural structure is more efficient and world-class. Therefore billions were spent on constructing bridges, roads, railway transportation, power infrastructure etc. Construction equipments especially earth moving equipment sector has benefited the most from these developments and is poised to grow at double digit CAGR by FY 2014 (Free Press Release, 2010). It is expected that during 2007-2015, the potential investment for new equipments and materials will be around US$ 750 Billion. Scenario 2 Employment Opportunities India with its high potential untapped market attributes has become a favourite destination for global construction equipments companies. There will be demand for over 24.3 million new dwellings for self-living in urban India alone by 2015 (Housing Skyline of India 2007-08) Considering governments projects lined up for the Eleventh Plan period, the demand for construction is expected to grow by at least 8-9%, and 2.5 million employment opportunities per annum are expected to be generated ( BMI, 2011).Thus those who are looking for opportunities in this sector would be rewarded with accelerated learning and fast progress. Construction Industry has created a need for the full spectrum of employees varying from professionals like civil and mechanical engineers and architects to daily basis wage construction workers and industrial workers such as steel and cement manufacturers to highway toll booth operators. Thus it is advisable to join a leading Indian Construction Company, or a multi-national present in India even from a beginners level as there is large scope for training and rapid upward movement through the ranks for talented individuals. Scenario 3 Changing Indian Economy The changing economy is placing increasing pressure on Indias physical infrastructure, not only from population growth and developing economic activities, but also structural changes in the economy. Indias economy now clearly reflects a steady decline of primary sectors, such as agriculture, forestry, and fishing, giving more importance to the non primary sectors such as service and manufacturing industry. But it is predicted that growth in construction spending in the longer term is likely to be enormous, driven by a rising population and a growing middle class. Since 100% foreign direct investment (FDI) is now allowed in construction, it now allows significant inflows of capital to meet growing demand from the increasing middle class. Indias population growth rates remain well above replacement level and the number of people living in urban areas is likely to grow significantly (BMI, 2011). ( APPENDIX 5) Conclusion Though all these scenarios are linked together and their inter relationships can produce long and complex results, growing population is the key driver of success of the construction industry. (Johnson , Scholes Whittington, 2008) According to me the second scenario is the most influencing scenario as it is directly linked to Indias growing population which is an unstable factor growing at a fast rate and directly linked with the success of the construction industry. Bibliography India Netzone, (2008), Nature of Construction Industry, Available at: http://construction.indianetzone.com/1/nature_construction.htm. [Accessed 15 March 11] Indo Italian Chamber of Commerce Industry (2008), Overview of the Construction Industry in India , Opportunities, Available at: http://www.centroesteroveneto.com/pdf/Osservatorio%20Mercati/India/Ricerche%20di%20Mercato/2009/Construction%20Sector.pdf, [Accessed 15 March 11] Info Shine (2008),  Construction Real Estate Available at:  http://info.shine.com/Industry-Information/Construction-and-Real-Estate/855.aspx, [Accessed 15 March 11] Research Markets (2006), Indian Construction Industry: An Analysis., Description, Available at: http://www.researchandmarkets.com/reportinfo.asp?report_id =335655t =dcat _id=,[Accessed 15 March 11] Credit Analysis Research, (2010), Indian Construction Industry, Available at: http://www.careratings.com/content/ResourceCenter/reports/Synopsis_for_Construction_Industry.pdf, [Accessed 15 March 11]. Farook Azam (2010), Institute of Industrial Engineers, The Construction Industry in India , Available at http://www.iienet.org/Details.aspx?id=20432 , [Accessed 15 March 11]. CBS Interactive Business Network (2006), The Indian Construction Industry, Available at: http://findarticles.com/p/articles/mi_m0EIN/is_2006_Nov_20/ai_n16851629/?tag= content; col1, [Accessed 15 March 11] Law is Greek, (2010), An Overview: Special Economic Zones (SEZs) in India, Available at: http://www.lawisgreek.com/an-overview-special-economic-zones-sez-in-india/, [Accessed 15 March 11] Johnson, Scholes Whittington (2008), Industry Life Cycle, Exploring Corporate Strategy, 8th Edition, Pg 68-69 [Accessed 16 March 11] Accommodation Times, (2009),  Globalization of Construction Industry Available at: http://www.accommodationtimes.com/property-rates/globalisation-of-construction-industry/, [Accessed 16 March 11]. World Market Intelligence, (2010) , Future of Construction In India, Available at: http://www.docstoc.com/docs/25943727/The-Future-of-Construction-in-India, [Accessed 16 March 11] Moht Saraf (2009), Real Estate, Indias Real Estate Sector: An Overvie, Available at: http://www.whoswholegal.com/news/features/article/18426/indias-real-estate-sector-overview/ [Accessed 16 March 11] K.V.S.S., Narayana Rao, (2009) Industry Analysis Valuation, Infrastructure INDIA Version 14, Available from: http://knol.google.com/k/narayana-rao-k-v-s-s/industry-analysis-and-valuation/2utb2lsm2k7a/950, [Accessed 16 March 11] Hindustan Construction Company India (2007), HCC: About HCC, Available at: http://www.hccindia.com/hcc_admin/data_content/pdf_files/HCC_bags_Rs._693_.61_crore_Euro_1_.457_crore_order_from_Delh_.pdf, [Accessed 16 March 11] Arghadeep Laskar and C. V. R. Murty (2005), Challenges before Construction Industry in India, New Materials, Equipments Technologies, Available at: http://www.iitk.ac.in/nicee/RP/2004_Challenges_Construction_Industry_Proceedings.pdf, [Accessed 16 March 11] Free Press Release (2010), Indian Earth Moving Equipments Industry to Boom in Near Future Available at: http://www.free-press-release.com/news-indian-earth-moving-equipments-industry-to-boom-in-near-future-1287567300.html, [Accessed 16 March 11] Business Monitor International (2011), Industry Forecast Scenario, Available at: http://www.businessmonitor.com.libproxy.nlb.gov.sg/cgibin/request.pl?SessionID=393511974808887view=articleviewerarticle=446198service=22iso=INmetaid=190, [Accessed 16 March 11] APPENDIX Appendix 1 Source: IHS Global Insight Appendix 2 Source: IHS Global Insight Appendix 3 Source: IHS Global Insight Appendix 4 Indian Construction Industry Value Forecast Source: Data Monitor

Symbols and Symbolism in The Wraith of the Rose :: Wraith of the Rose Essays

Symbolism in The Wraith of the Rose "The Wraith of the Rose" is poem that seems to suggest the dual nature of love and relationships. There is the love and joy that is represented by the natural beauty of the flower, which is accompanied by the bitterness of a love that was lost and the pain that remains. The idea that love sours is not new, but in this poem there is the wraith, which is a ghost, that represents the pain that love can bring. One of the most interesting sections of the poem that goes from line 13 to 23 and starts with "I wish" in groupings of three reflects the desires of a lover looking back on a past relationship and the longing to go back to the happier days of the relationship. This longing is just as evident in the rest of the poem and is solidified with the symbolism of the wraith. The first groupings of "I wish" start with a genuine sentiment by the author to again be in the place where "the chain was still unbroken" and to have " kept that last fond token". This entire group suggests that the author keeps fond memories of the relationship. In the next groupings of "I wish" the author starts to point the finger at the other person in the relationship by using the line "I wish you were not all deceit". This is the first instance where the author expresses anger about the break-up the relationship and does not recall memories with fondness. Although the author does address her own faults by saying, "And I so fickle-hearted", she stills holds contempt for her past lover. I am somewhat surprised that it took this long for the author to place blame on the other person because of the fact that most people and selfish and assume that the reason for a relationship not working is always the fault of the other person, not their own. The third groupings of "I wish" further implicates the other person as the cause for the failure of the relationship and the reason why they are not together now. She writes "I wish you could reclasp the chain" and "I wish- you hadn't drunk champagne". These lines have an honesty about them and ring true to the feelings of a normal person dealing with the loss of a relationship.

Economic Effects on Easyjet

Coursework Two: Written report evaluating and commenting on the recent developments in monetary, fiscal and exchange rate policy in the UK and abroad and how these impact on easyJet With the new coalition Government of the Conservatives and Liberal Democrats gaining power in 2010, and almost immediately calling an emergency budget, as the Conservatives promised, declaring their primary objective is to reduce the deficit there have been many changes in fiscal policy and reversal of plans by the Labour Government, there has also been changes in the exchange rate which will have considerable impacts all over the world.Additionally the Bank of England has looked to make use of monetary policy. All of the changes in the UK, and in Europe will have an impact on easyJet (as easyJet only flies in Europe). The objective is to identify the changes in macroeconomic policies in the UK and abroad, using data and information from The Bank of England, the European Central Bank, the Institute for Fi scal Studies, the Budget, the easyJet corporate report and other various economic sources.The Main Objectives of Government macroeconomic policy are; sustainable economic growth, stable low inflation, low level of unemployment, and a good position on the balance of payments. It is that final policy that the coalition Government has declared most important.With the deficit growing year on year, with little sight of changing, and as such they have used fiscal policy drastically recently as, especially the Conservatives in the coalition Government, have looked to reduce the budget deficit with across the board cuts (totalling six billion Pounds) in Government spending, this coupled with the various tax rises are extreme measures which seem necessitated by the extreme economic times we are in. Many believe these actions will lead to a double dip recession, one which it could take the UK many years to recover.The Government also increased VAT on the 1st of January from 17. 5% to 20% (the highest it has ever been). Although George Osborne (speaking to the BBC on the 4th of January) thinks â€Å"targeting VAT is more progressive than increasing income tax or National Insurance† many still believe VAT is a very regressive tax, meaning it is more of a burden on those households with lower income. This graph (compiled by the Institute for Fiscal Studies) shows how the poorest 10% will be hit much harder than the other 90%, seeing a percentage loss of net income more than double that of the richest 10%.This is because VAT is on goods including necessities, which means a rise in VAT will not deter people from purchases of said goods, so VAT will have a large impact on their percentage net income. Although overall a rise in VAT will have cost the richest 10% more, as their net income is considerably larger they have to capacity to cope better with the rise, and will cause a smaller decrease in their net income. Another rise is in fuel tax, â€Å"Given that each pen ny increase in fuel duty raises an extra ? 00 million for the Exchequer, it is easy to see why the chancellor is tempted to hike rates,† said the foundation's director, Professor Stephen Glaister. The Government have increased fuel duty by 0. 76p on petrol and diesel, and the rise in VAT will mean another price increase. The AA estimates that â€Å"these increases combined will add approximately 3. 5p to the cost of a litre of both petrol and diesel. † According to HM Tresuary budget report 2010 â€Å"The most urgent task facing this country is to implement an accelerated plan to reduce the deficit.Reducing the deficit is a necessary precondition for sustained economic growth. † As such another part of the recent fiscal policy changes in the UK was announced in The Budget, that public sector net borrowing would remain at 4 per cent of GDP in five years time, the structural deficit would be 2. 8 per cent of GDP by 2014-15, while the structural current deficit woul d be 1. 6 per cent. They also set that public sector pay would see a two year freeze, apart for those earning less than ? 1,000 a year, this is an attempt to stop the rise in wages for the thousands working in the public sector, which will save the Government paying more and more each year and thereby help to reduce the deficit. Yet public sector employees will be hit hard by this policy, as inflation rises – their wages will not, meaning inflation will have a devastating impact on their net income as real prices rise, and taxes are increased. This will lead to public sector employees to purchase less, and thus provide less chance of growth which is one of the main macroeconomic objectives.However corporation tax will be reduced from 28 per cent to 24 per cent, a reduction that will be spread over the next four years from April 2011. This may encourage businesses to expand as they are paying less tax, which could lead to a decrease in unemployment (one of the primary macroeco nomic objectives) The budget also released a plan to â€Å"reduce the main and special rate of capital allowances to 18 and 8 per cent respectively in April 2012. Also capital gains tax will be increased to 28 per cent for higher and additional rate taxpayers† (The Budget), so the higher income households will have to pay a higher than ever before tax.The Government also intends to freeze council tax for 2011-12 by working with the local authorities, this potentional freeze on council tax will help the poorer level income earners, and could help them to escape the poverty trap. An increase in tax for the higher level income earners will not only provide more money for the Government – in an attempt to reduce the deficit – it will also improve the image of the main party in power; the Conservatives whereby they are seen as more favourable to the higher level income earners in the UK.Another policy instated is, what the Treasury call, â€Å"a reversal of the most damaging part of the planned increase in National Insurance Contributions† by instead of reducing it as Labour had planned, they are raising the threshold by ? 21 a week in April 2011. This will also lessen the burden on the poor, and thus with more available incomes they will spend more, which will be an injection into the circular flow (where the flow of payments in an economy is a circular flow, with injections and leakages, the injections being Government spending, investment etc, and the leakages primarily being saving).Europe was also been impacted by the recession over recent years, and their fiscal policy must try to combat its negative effects. Before the Recession, many countries in the EU had a large structural deficit. There was an inability to meet fiscal targets, for example the political pressure against tax increases and spending cuts. One country which has particularly been affected is Greece, with the EU average debt as a % of GDP at an already staggering 78 . 2%, Greece’s is at 122%. They have been hampered by powerful unions which gained considerable public sector wage increases without corresponding increases in productivity.Greece has also struggled to raise taxes and decrease Government spending. The depth of the recession has worsened the Government fiscal position much more quickly than expected; tax receipts have fallen while spending on unemployment benefits has increased dramatically. In Ireland they plan to tighten fiscal policy by more than 4% of GDP next year. However economists (Simon Tilford, Centre for European Reform, November 2010) debate whether a tightening of around 1. 5% in 2011 will derail the UK's economic recovery.Governments usually run a deficit in bad times, and a surplus in good times, yet in these times of recession Germany is running a budget surplus, by making necessary wage adjustments and increases in taxes as they are performing much more strongly than expected. Although The Bank of England was nationalized in 1997 by the then Chancellor of the Exchequer, Gordon Brown, meaning the Government no longer had control over the Bank of England, fiscal policy will have a large impact on the economy and how monetary policy is conducted.The primary tool of monetary policy is the use of interest rates. However in the UK the base rate was  left unchanged at 0. 50%  in the January meeting, the 22nd month in a row. The news of an economic slump, the UK economy contracted 0. 5% in the final three months of 2010,  has reignited fears of a double-dip  recession  and has reduced the likelihood of an early rate rise. Yet two  of the 9 MPC  members voted for a rise in the base rate at the January meeting, a rare split decision. However due to an inflation rise in December the CPI rapidly rose from 3. % to 3. 7%, chances of an early rate increase to control price pressures has raised. The Bank of England predicted in February 2010 that inflation would be at 1. 5% by the end of 2 010, which is far of the actual rate of 3. 7%. The MPC must now hope that price pressures will ease so it can stick with low rates and avoid stagflation. However it may be out of their control; global commodity prices have been, and still are, rising fast and Source tradingeconomics. com are now pushing up the cost of UK exports.The idea of increasing the base rate will encourage saving (a leakage from the circular flow) which will help to decrease spending and therefore inflation. However this could be met with a reduction in growth, or even the economy shrinking. Failing to raise the base rate would seem counter intuitive as the Government CPI target is 2% and inflation it at 3. 7%, well above the 1% band. The Bank of England decided to employ quantative easing by pumping ? 200bn into the system in an attempt to kick-start the UK’s economy.But the GDP shrunk by 0. 5% in the last quarter of 2010, so this policy does not seem to be helping growth. The MPC predicts inflation w ill continue to rise past 4% in the coming months which will encourage higher pay demands and could start up a wage/price spiral, the rising expectations of inflation means people/workers expect prices to continue to rise, so they are unlikely to accept pay rises less than the expected inflation rate because they want to protect the real purchasing power of their incomes, and this pattern continues.Monetary policy is greatly restricted in Europe due to the Euro, being a member of the Euro means that individual countries face limitations such as an inability to employ quantative easing or alter the base rate to affect the economy (this is one major factor in why the UK has not joined the Euro, and that the Coalition Government has stated that while they are in term they will not join the Euro). As such the European Central Bank (ECB) has power over setting the base rate, which since 5/7/2009 has been 1%, almost as long as the UK has been at 0. 5%.The ECB states â€Å"maintaining pri ce stability is the primary objective of the Eurosystem and of the single monetary policy for which it is responsible. † This is laid down in the Treaty on the Functioning of the European Union, Article 127 (1). Yet prices in the Eurozone have been very unstable in the past years. However Germany has seen strong signs of improvement, but t this could actually hamper the rest of Europe’s growth. The CPI measure of inflation is rising at an annual rate of 2. 2%. That's not as high as the UK, but it's above the European Central Bank's (ECB) target for the first time in two years.As Germany is the most important and influential economy in the Eurozone when it comes to setting monetary policy, it means the ECB will have heavy pressure to raise the base rate this year, regardless of how the rest of the region is performing. Which is ironic as when the euro was introduced the base rate was set to a level to suit Germany’s sclerotic (rigid and unresponsive) economy that was still dealing with reunification. But the cheap money turned the strongly-expanding countries, such as Ireland and Greece, into smaller and floundering economies.The UK has operated a free floating exchange rate since September 1992, meaning The Bank of England has not intervened in the markets to influence the Pound’s value. This means that the Exchange rate is purely market determined which leads to many fluctuations, just in the period from August to January displayed in the graph below. A floating rate can be a tool of macroeconomic adjustment – for example a depreciation in the Pound should increase the net export demand and therey stimulate growth.However the BoE would hope the gains from a lower exchange rate are not dissolved in the inevitable higher wage demands or export prices. The countries inside the Euro Zone are hoping for a more competitive exchange rate to create an injection of demand into their struggling economies. Floating exchange rates offer a degree of adjustment, so as is the situation now a large trade deficit puts downward pressure on the exchange rate which will help the export sector and control the demand for Euro’s to Pound Sterling imports as they become relatively expensive.Having no exchange rate target means that short term interest rates can be set to meet domestic macroeconomic objectives such as growth or low inflation. However with a floating exchange rate there is less currency stability which can discourage Date (2010-11) Source x-rates, composed on excel trade and investment, this is one of the reasons why currencies were locked within the Euro Zone for the Euro. Any changes in the prices of imported goods and services will have a  direct effect  on inflation. The Euro is also a floating exchange rate, meaning it’s fluctuations in relation to the UK have considerable affects.An appreciation of the exchange rate (as there has been in January against the Euro) reduces the sterling pric e of imported consumer goods and durables, raw materials and capital goods. The effect of a changing currency on the prices of imported products will vary by type of import and also the  price elasticity of demand  which is affected by the degree of competition within specific markets. All companies will be affected by these policies, both UK and abroad, and easyJet is no exception. The current price of jet fuel is â€Å"$897 a metric tonne compared with $681 a metric tonne a year ago†, easyJet stated in January 2011.This increase in fuel tax and price will cost easyJet ? 1. 17 extra per than in 2010, and is expected to double the losses of the company to approximately ? 140 million, as it will for all companies in the airline market. As for the VAT rise, easyJet have announced they may be able to save millions of Pounds in VAT by registering its new budget holiday company outside Britain, with Lowcost Travel, expected to be in Switzerland. This means they will avoid VAT under the Tour Operator’s Margin Scheme. This could save easyJet ? 0 million in VAT for the next three years. Most European markets saw losses or declines in January with concerns that China will raise interest rates again to slow down economic growth in Europe, and easyJet suffered alike with a fall of 16. 19 percent in the FTSE250 after they predicted heavy losses in the first half of 2011. easyJet announced in January 2011 that it, as all other airlines, was hit by the severe weather in Europe in December 2010 and strike action by French air traffic controllers, coupled together this cost easyJet ? 31 million,. asyJet is also set to close its cut services at Luton Airport by a fifth (which sees 5 million passengers each year) with a view to transferring them to profitable bases in continental Europe. The airline also initially price flights from European destinations in Euros, but customers can choose an alternative price in sterling. However, the price in sterling is set at a lower rate, this is because easyJet decided not to use the Mastercard or Visa rates that the most retailers use, and instead set the interest rate themselves – at a much lower level.Generally the difference between the actual exchange rate and what easyJet offer can be anywhere between 2% and 6%. This generates a lot more income for easyJet by exploiting the exchange rate at the right time, yet it can been seen as a hidden cost, which would not impress easyJet’s customers, and in the long run could actually lose them customers. Elasticity of demand measures how a change of the quantity demanded is affected by an income or price of another good change.As the airline market demand is elastic businesses must be careful with changing prices and must be sure that by decreasing their prices they are still able to increase their market share. easyJet have achieved this, by coming in with very low prices and gaining market share. Another problem facing easyJet is that pas senger duty tax increased from ? 10 to ? 11 in November 2010, which again cost easyJet millions. However, despite these setbacks, the airline said revenue in the final three months of 2010 â€Å"was up 7. 5% to ? 54 million compared with the same period a year ago†. easyJet announced in November 2010 that profits have been â€Å"boosted by a rise in passenger volumes and the group said it will pay its first ever dividend in 2012†, the airline’s chief executive, Carolyn McCall, said â€Å"We therefore intend to commence the payment of an annual dividend based on a dividend cover of five times. † The airline said passenger numbers grew 8% in the full-year to the end of September to 49 million, while profits totalled ? 154 million in the period – against ? 55 million a year earlier. asyJet’s have continued to strengthen with â€Å"market share gains across Europe particularly London Gatwick, Paris Orly (easyJet grew capacity by 22% in France i n 2010) and CDG and Geneva† (easyJet corporate reports, January 2011). Additionally in response to growth in Germany, easyJet carried on refocusing its offering, and increased capacity on key business routes out of Berlin. The total fleet plan over the period to 30 September 2013 is as follows: | easyJet A320 family| Boeing 737-700| GB Airways A320 family5| Total aircraft5| At 30 September 2010| 182| 8| 6| 196| At 30 September 2011| 202| 2| –| 204|At 30 September 2012| 214| –| –| 214| At 30 September 2013| 218| –| 2| 220| Note 5: Four ex-GB Airways A321 aircraft exited the fleet in November 2010. Source: easyJet corporate reports, Jan 2011 By eliminating the Boeing and ex-GB Airways sub-fleets it will reduce costs by simplify operations. easyJet plan to complete this by 2012 and they project cost savings of around ? 30 million each year. They are also set to work with the EU on consumer rules to make sure that they have the right balance between the benefits that low costs brings to consumers over its costs to the industry.The air traffic control strike in 2010 was caused by the economic pressures facing Europe and union concerns about the Single European Sky programme, and easyJet â€Å"expect disruption to continue in 2011† and â€Å"will press for measures to be put in place that alleviate the impact of these strikes and push for faster reform. † (easyJet corporate reports). There has recently been a saturation in the European and UK airline market. Competitors have mimicked easyJet’s strategy and have introduced competitive brands with similar price strategies that have increased competition, and decreased market share.The airline market is best classified as having a monopolistic competition market structure, whereby there are many firms will similar, yet differentiated services. Some companies have contrasting services; easyJet and British Airways for example, one with a strategy to keep costs as low as possible by stripping out almost all non-essentials of air travel (ranges in class etc) and one, BA which offers a higher level of service with a higher cost. It also has many business with similar plans and ideas; easyJet and Ryanair for example.The Herfindahl Hirschman Index (HHI), which measures the degree of competition in one market for the airline market, and is 0. 070210776 (see attached excel document for details). This means that the market is unconcentrated; this indicates that the market is unlikely to have adverse competitive effects, as no companies have a monopoly power. In conclusion, the fiscal policy employed by the coalition Government will have long reaching affects across the economy, including the airline market.It will also have drastic affects on the population, with many tax rises; VAT and fuel in particular, which will reduce the level of net income for all households. However the rise in the National Insurance threshold will be very positive for the low er income households. As for businesses, the reduction in corporation tax over the next four years will be a welcome policy, yet almost all companies will be affected by the rise in fuel tax, particularly the transport market – easyJet.The Bank of England will soon have to look further into raising the base rate, the historically low level of 0. 5% will not help any savers (although it helps those with large mortgages, loans etc. ), and when they decide to raise the rate it can help combat the continually increasing level of inflation. The exchange rate is left as a free-floating, which it will be for the foreseeable future. This is like almost all countries, so the market controls currencies, which will periodically rise and fall, and deal with the level of imports and exports and their competitiveness. asyJet will undoubtedly suffer great losses due to the fuel rises, which are expected to continue to rise as oil becomes a more scarce resource the supply falls – whic h will increase the price. They have plans to deal with VAT, and are looking to cut any unnecessary costs across the board to cope with these rises. The further strikes planned by the ATC for 2011 will again cost easyJet millions, but they believe they will be better equipped to deal with these problems.Any unpredictable, or problems outside their control, snowfall of December and the Icelandic volcanic ash clouds will also cause considerable losses, yet there competitors (and imitators) will see similar losses so it will be highly unlikely that easyJet become less competitive as the airline market continues to combat numerous problems. References Financemarkets. com HM Treasury Budget The European Central Bank website The Bank of England website The easyJet annual, and corporate reports Tutor2u The Institute for Fiscal Studies tradingeconomics. com x-rates. com The Economist

Common Examples Of Child Protective Service - 1687 Words

In 2002 there was estimated to be nearly 3 million referrals to Child Protective Services (CPS) in the United States, and about 5 million in the year 2000 (McWey Mullis, 2004). Children who are living in environments that put them in harms way, depending on the situation are generally removed from their home and placed into a foster home in attempts to keep them safe (Carlson, Egeland Lawrence, 2006). Common examples of Child Protective Service (CPS) referrals include physical abuse, sexual abuse, and psychological maltreatment (McWey Mullis, 2004). In 2001 it was estimated that nearly 542,000 children were in foster care in the United States and that the number of children in foster care exceeded the number of available foster homes by nearly 30-40% (Carlson, Egeland Lawrence, 2006). For many children in foster care, reunification with biological parent or parents is the ultimate goal (McWey, Acock Porter, 2010). 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