Critically Evaluate the Management Model of Baumol

Under the traditional economic understanding, it is always assumed that profit maximization is treated as the main goal or objective for businesses, subject to perfect knowledge, single entity and rational logic. However, as illustrated by the principal-agency problem, managers do not usually make rational decision entirely like owners who take company interest as their sole basis for their decisions. Past examples have shown that managers do take their own personal goals and satisfactions as consideration in their decision-making. In addition, information gathering is not always perfect as managers do make decision by relying solely on the implicit knowledge gained from past experiences, without referencing to the macro-economic environment and the current market changes. Combining all these factors, it is therefore understandable that businesses do not always work toward profit maximization, at least in the short term, and other objectives like financial objective, market share, executive power, etc. do involve in business decision making. However, as pointed out by various academics (Baumol, 1962; Marris, 1964; Williamson, 1963), profit maximization does not always serve as the only correct objective for a firm, especially at various phrases of the business on a timeline scale. A point-in-hand is Baumol model. As an alternative to profit maximization model, Baumol model works on the correlation between price and output decision with the objective of maximizing sales revenue, subjected to minimum profit constraint by shareholders. In profit maximization model, profit is maximized at the output where Marginal Revenue (MR) is equaled to Marginal Cost (MC) whereas Baumol Model emphasizes on maximizing sales revenue (TR) and may miss the MC = MR point to achieve its goal. This model argues that businesses try to maximize sales revenues rather than profits with the possible motives such as growing or sustaining market share, to fill up spare capacity, discourage new entrants, management performance and etc. In addition, Baumol model provides a platform to understand some of the pricing strategies adopted by certain industries, which usually share common characteristics of having huge sunk cost and low variable cost. In such industries where fixed cost or sunk cost takes up a huge part of the total cost, producing a single unit and its maximum allowable output (without expanding its capacity in the short term) does not have any significant impact to the total cost. In such instances, profit maximization model is neither practical nor feasible as a focus of the model relies on seeking the output point where MC=MR. In the case of Walt Disney, the operational cost does not differ much whether there is one patronage or maximum allowable patronages as a theme park has to be fully functional during its operation hours, which render the MC at zero or near zero level. The objective of the company to seek sales revenue maximization for the day rather than focusing its effort to achieve the output point where MC=MR to maximize its profit does make sense. This explains the two-part pricing strategy adopted by Walt Disney where a fix initialization fee per entry is charged and allows the patronage to have as many free rides as they wish. Another example is the telecommunication industry, where the initial investment/fixed cost (for example launching the satellite and setting up the infrastructure) is huge, and the variable cost per call is insignificant to the total cost. In such industry, firms will focus on maximizing sales revenue (with constraints to maximum capacity/output) by using strategies like price discrimination strategy. In this strategy, the firms charge a different unit price to peak and off-peak hours, as there is plenty of spare capacity at off-peak hours. Since MC of output is low, any additional revenue that can be generated from this surplus capacity will be profit to the firms. As such instance, it is rational for telecommunication industrial to adopt sales maximization model like Baumol. In addition, as short term capacity is always constraint and limited, telecommunication industries would not want to experience loss sales due to their inability to meet customer demand, especially during peak hour usage. As service providers, consistent and frequent service failure could prove to be fatal in term of their survival and their long-term brand reputation. Therefore it would make sense for telecommunication firms to divert the peak-hours traffic into non-peak hours by using a price discrimination strategy which segments the users based upon their willingness and abilities to pay. For instance, business-users are willing to pay higher price for peak-hours usage due to their inelastic demand whereas in contrast, leisure-users’ demand is elastic and are willing to make call during off-peak hours in return for lower price. By adopting the price discrimination strategy, telecommunication firms are able to maximize sales revenue during peak and off-peak hours by balancing the air-time traffic based upon different market segment of users. At this point, it is also noticeable that one of the characteristics of Baumol firms lies in the perishable products/services offered which cannot be inventoried. The loss sale of the day on the unutilized capacity/outputs is an opportunity cost to the firms. Baumol model is not only applicable to huge/large corporations, but also to small retailers like bakery shop or wet market, which explains the reason why some bakery shops offer a special discount one hour before the shop closed to maximize the revenue. The rationales applied similarly to the low cost carriers (LCC) where price discrimination is used as a strategy to maximize revenue. LCCs sell a cheaper price to early booking passengers and a higher price for last minute passengers to increase the revenue. LCCs used the existence of multiple segments to serve and the opportunity to utilize surplus capacities to generate additional revenue. The adoption of sales revenue maximization model is also used as an effective way of securing additional market share within a regulated market with limited players where market dominance is vital. In related to pricing, add-on product/services like travel insurance, priority boarding and choosing-a-seat are used as bundled offering to the customer to gain extra profit. Firms are willing to earn a smaller profit if it means that they are able to gain a competitive advantage from their rival firms. As an illustration, Fitness club is a good example to elaborate how Baumol model is applied through adopting different pricing strategies. The reasons behind Fitness Club in adopting Baumol model include penetration to new market segments, retaining existing customer and to fill up spare capacity. True Fitness, which is a chained fitness centre, is effectively using Baumol model by offering different pricing strategies to capture different market egments, for instance, offering monthly fees to uncertain-customer and yearly/lifetime membership to certain-customer. Two types of pricing strategies are used by True Fitness to maximum its sales revenue, which are:- i)Two part pricing ( lifetime membership) The company offers a lifetime membership at ? 1. 5K as one-off payment and charges a minimal price of ? 20 yearly as administration/subscription fee. By payi ng a lifetime membership fees as fixed price, the customers are able to enjoy the facilities for life for as low as ? . 67 per month, which no other rivals is able to compete with this low price. As per other industries discussed above, fitness clubs have the similar characteristic like high initial set up cost and low marginal cost to adopt the Baumol model. The company charges an upfront fee to gain maximum consumer surplus and utilizes the yearly subscription fees, which is equaled to the marginal cost/average variable cost, to cover its yearly running costs. In addition, in order to adopt the two-part pricing strategy to maximize sales revenue, the company needs to have a minimum output (also known as critical mass), so that the full consumer surplus can be derived from the fixed fees. For example, if the yearly running cost (without considering the depreciation cost of the initial set up) is ? 200,000, in order to offer a yearly subscription fee of ? 20, the company needs to have a minimum membership of 10,000 in order to reduce the average variable cost/marginal cost to this level. By adopting Baumol model, which gives a higher output with lower price, this is achievable. This pricing strategy is also applicable to other chained-companies where the firms can derive the maximum profit from the fixed fee and use it as capital/investment to set up a new chain store. At the same time, individual chain store is able to run by itself from the revenue derived from the minimal pricing. ii)Price discrimination ( monthly membership vs. lifetime membership) True Fitness segments their customers into certain and uncertain customer by ffering different pricing to monthly and lifetime membership. The club is willing to offer a lower price to customers who are willing to commit, in comparison to uncertain customers. As illustrated in earlier examples, fitness clubs need to fill up spare capacities as any unutilized capacity carried an opportunity cost. With customers’ commitment, they are able to secure their stability in term of both volume and sales revenue. For thos e uncertain customers, the company charges a higher price, which customer willing to pay due to the flexibility and short-term commitment. From the above illustrations, it is apparent that a key characteristic of the Baumol model hinges on the elasticity of demand. As shown, Baumol model uses pricing strategies as a mean to achieve revenue maximization, and is therefore heavily dependent on the price elasticity to achieve the objective of the model If the demand is inelastic, Baumol model will not work as the demand of the product/services will not increase proportionately and therefore the sales revenue will not maximize from the reduction in price. In addition, advertising effect has not been considered in the above examples, which is a common tactic used to increase the inelasticity of demand. The psychological effect of advertising has been proven effective in occupying the mindset of consumers through brand image building, which increase the affiliation of the consumers to certain products/services, thus the inelasticity of the demand. The pointers from the last paragraph are well-illustrated by the Memo 1 example in Baye text book. In this example, it is shown that the price change does not correlate with the demand. By reducing the price from the current, $10. 50 to $10, the subscribers drops from 881 subscribers to 842, causing the revenue to drop from $9251 to $8240 and therefore a profit drop of $614. 5. (Appendix 1). In reverse, the firm should increase the price to $11. 5 to maximize the revenue at $11282 and a price of $12. 5 to maximize the profit at $4734. One of the reasons is due to the advertising and promotional effort from the company which increases the inelasticity of the demand. Secondly, since a loyal group of subscribers has already been amassed, STARZ network functions more as an add-on product to the existing subscribers. The combination of these two factors explained the reason why sales revenues and profit actually increases with price increases. In addition, from the data on STARZ network (Appendix 1), it is apparent that STARZ network does not share the same characteristics of high fixed cost or excess capacity to apply Baumol model. Instead, it seems like advertising or bundled pricing works better for STARZ network rather then price reduction. Further to the points above, Baumol model players are highly susceptible to the price reaction from their rivals, which could easily result in a price-war especially in an oligopolistic market. The existence of a floor triggering price in Baumol model constrained the players from lowering the price too much which will defeat the purpose of revenue maximization. Thus, it is highly unfavorable for Baumol model players to induce a price-cutting reaction from their rivals when they attempt to lower the price. This explained why certain Baumol model players used â€Å"noise† as disguise to their rivals when lowering the price to achieve revenue maximization. To summarize, long-term profit pursuance remains as the ultimate objective for any business. However, due to dissimilar characteristics of different industries, there are various models that can be used to achieve this long-term objective, which explains why certain firms are willing to sacrifice profit today in exchange for profit tomorrow. As illustrated through various examples in this assignment, the application of the correct model for the right industries and at the correct phrase of the company life-cycle becomes an even more important decision for managers to make. With the understanding and knowledge gained through the detailed analysis and critique of Baumol model, an useful insight to the economic rationale adopted by various industries, like Walt Disney, LCC and telecommunication firms is achieved. Bibliography Mercuro, N. , Haralambos, S. Gerald, W. , 1992. Ownership Structure, Value of the Firm and the Bargaining Power of the Manager. Southern Economic Journal, 59(2), pp. 273-83. Baumol, W. J. , 1996. Prediction and the logic of the Averages Variable Cost Test. Journal of Law and Economics, 39(1), pp. 49 – 72. McNutt, P. A. , 2008, â€Å"Signalling, Strategy & Management Type†, Available at: http://www. patrickmcnutt. com/docs/PatrickMcNutt. com_ebook [Accesses 20 Jan 2009]. Baye, M. R. , 2009 . Managerial Economics and Business Strategy. International ed. New York: McGraw-Hill. Conway, L. L. & Craycraft, J. L. , 1974. Sales Maximisation and Oligopoly: A Case Study. Journal of Industrial Economics, 23(2), pp. 81-95. Armstrong, M. & Vickers, J. , 2001. Competitive Price Discrimination. The Rand Journal of Economics, 32(4), pp. 579-605. Oi, W. Y. , 1971. A Disneyland Dilemma: Two-Part Tariffs for a Mickey Mouse Monopoly. The Journal of Economics, 85(1), pp. 77-96. McNutt, P. A.. Management Objectives and Stakeholder Value (Study Guide Unit 1).

Miners’ Wives by Ben Shahn Essay

The Miner’s Wives by Ben Shahn takes a bitter look at one of the lifestyles of the early 20th century – that of the down-trodden coal miner. In the foreground of the picture, we see the miner’s wife referenced in the title. She carries a bleak expression, her back turned to an older woman and a child, presumably her mother and her offspring. Two men walk away into the distance, and one set of clothing hangs above, unclaimed by its owner. The woman has just been informed of the mining accident which claimed her husband’s life. Shahn says much about the mining life through the composition of his painting. His focus is on the woman who has just lost her husband. She stands off-center, not crying or hysterical, but with an expression of shock and numbness. This isn’t the first time she’s experienced this kind of pain. The presence of her mother suggests that she has lost a loved one before, presumably her father. Even the method he uses to paint her, distorted, inproportionate, and unidealized, emphasizes her station in life. She has lived a hard life, and her face shows it. The red brick wall behind her expresses the anger and torment she’s feeling. It has to, because she must remain stoic for both her child and the world at large. She can’t rage at the mining company, and she must not let her child see fear, so Shahn gives this wall the most brilliant, angry color he can muster to express what she’s feeling. The wall is also a divider, separating the wives’ miserable, lonely existence from that of the mining bosses who calmly walk away. Having given her the news, they feel they’ve done all that needs to be done for this woman. Their facelessness emphasizes the fact that these men are interchangeable in the minds of the women, all alike. They rob the women of everything: their husbands, their livelihoods, and their dignity. The three generations in the room point out the nature of mining work as a family tradition. In fact, the miner’s legacy hangs overhead, the coat still attached to its hook long after its owner is gone. The elder’s husband was  probably a miner, the woman’s husband was a miner, and the presence of the child suggests that even the next generation will follow that path, despite the pain and injury all around. Such was often the case with mining. Limited mobility and limited opportunity often forced one generation after the next into the mine, and many families died generation after generation, either in the mine or from the mine, with diseases like black lung. Shahn makes a bold statement about how much the mining industry cost for those who went down into the mines every day. His characters appear placid, but they speak volumes about the lifestyle endured by not just the miners, but also their families.

On the feature of American slangs Essay

Abstract: With the development of the society, slang is accepted by more and more Americans. This thesis analyses features and functions of American slang. The author draws a conclusion that American slang reflects the cultural characteristics of Americans’ humor, informality, self-confidence, anti-authority, innovation consciousness and pursuit for time efficiency. Slang is a sort of informal language, the original purpose is to express vulgarly or use it as a jargon or cant. With the development of the modern American culture, the modern American slang has become a common linguistic phenomenon which is different from jargon and argot, spreading all over any aspects of life. In American English, slang is also one of the major parts in people’s life and can reflect the social life about civilian requirements and characteristics of language expression. According to accurate statistics, the daily American vocabulary is about 10000-20000 words, of which 10% about 2000 words are slangs, these slangs are frequently used in people’s daily life, with strong expression and abundant culture feature, therefore, only by having some certain knowledge on American slangs can we speak American English properly and natively. Here is what I am going to discuss on the characteristics of modern American slang, and the translation of American slang as well, so as to improve people’s understanding and the use of American slangs. The basic characteristics of modern American slang (a) informality The most significant feature is informality, which is the origin of the slang and nature of it. Because of the informal expression of American slang, moreover, comparing the American English with British English, the former is actually more flexible and informal. Therefore, it also determines the informality of American slang and makes it even more apparently. For instance: A:Excuse me. I have to catch some Zs. (Excuse me. I have to take a nap.) B:I thought you just woke up. Sleepyhead.(I thought you just woke up. You are lazy and sleepy.) In this example, a typical slang â€Å"catch some Zs† by the speaker means taking a nap, and â€Å"sleepyhead† means a person who loves sleeping, both of which are limited to oral English expression frequently, generally not used for formal expressions. In addition, common American slang expressions such as â€Å"kiss ass (sycophancy)†, â€Å"hit the road (set out)†, and â€Å"take a dump (defecate)† are typically informal. It is because of its obvious informality that Americans like advocating freedom of expressions in some light-hearted situations that need humorous atmosphere to ease embarrassing scene. Both politicians or ordinary people prefer using slangs to light up the atmosphere. (b) creativity America is a country that desires for freedom. In pursuit of innovation, people are unremitting to new things and new ideas, which creates a large number of novel American slang words and provide a perfect condition. Furthermore, one of the characteristics of American slang is innovative. American slangs always use the original or new words to reflect new things, new development and new concept. Like the word â€Å"jazz† , it was first used to express a kind of music in New Orleans. Along with the development of jazz, Americans soon produced â€Å"bop† (pop), â€Å"far – out† (fashion), â€Å"beat† , â€Å"cool† (modern), etc. Because of the style of jazz, the word â€Å"jazz† generates some new meanings, such as â€Å"exertion†, â€Å"cordiality†, â€Å"frenzy† and so on. The old American drug addicts created the slang nose candy, black stuff, shooting gallery referring to drug. The blacks create and use slang a lot, such as dog juices (cheap wine), cakewalk (a kind of hip-hop dance), breakdancing (break), etc. Since the 1980s, some modern terms have been popular among the young, such as â€Å"bag your faith (left)†, â€Å"big time (serious)†, â€Å"golden (women)†, â€Å"worms (ugly people)†. They are the creative use of the phrases from the slangs. The generation of slang is inseparable from the creative use of the original English vocabulary, and the creation of new words plays a vital role as well. The United States is a multi-national country with immigrants, and constantly the moving in immigrants creates new words, making the American slangs increase rapidly. All of these prove that American slang is innovative. (c)universality In American English, the use of slangs are very common. It has something to do with the pursuit of flexibility, innovation, humor in American English, also with the history of United States. In the history of the United States, â€Å"westward movement in the contemporary† formed the largest population flow, so that the regional dialect and the jargon from all classes including cant have been widely spread. Because the official does not emphasize on â€Å"literary language†, and has made few â€Å"language purification†, thus jargon and sayings which were constantly used , have formed today’s omnifarious slangs that Americans generally use. In the 20th century, American slangs had a development which progressed by leaps and bounds. During the two world wars, the Vietnam war, the Korean war, and the cold war period, a large quantity of slangs generated. Moreover, American social problems, such as racial discrimination, civil rights movement, family disintegr ation, sexual liberation, gay so on and so forth, much more American slangs have mushroomed. English slangs can be defined to common colloquial language, and according to the definition of the Concise Oxford English Dictionary (1985), slangs are frequently used as colloquial words and phrases. It cannot be taken as Standard-English, therefore this demonstrates that, slang is Nonstandard-English. Nevertheless, slangs are very popular among the English-speaking countries nowadays. Slangs are spoken by people in daily speech, and even magazine and literary works may find a large number of them. With the development of the society, slangs are widely used by more and more people, especially in America, slang can be found favorable in the Americans’ eyes. It is accepted by both upper-class and lower-class, and especially the college students who tend to use up-to-date words that form a kind of characteristic style of themselves. Slang plays an important part in American English. It is reported that slang accounts for one of the tenth of American average vocabulary. People’s attitude toward slang varies from person to person. Some think that slang cannot be used on the formal occasion, for it is spoken by the illiterate people only and the slang terms are so coarse. Some even think that slang is the filthy language, and advocate abandoning using it. However, others hold the opposite idea. They think that slang play an important role in English language, because of its fresh, lifelike, humor and adequate expressions. One must admit the undeniable fact that slang is spoken by more and more people. In modern times, if one is not familiar with American slang he or she could not capture the slang expressions in the movie and common fictions, and, what worse, one would 0make mistakes when they are talking with the Americans. An example will clarify the fact. A guide asks the tourist â€Å"anybody wants to take a leak?†(Does anybody want to go to the restroom?), and, of course, what the guide said would make the tourist surprise. It is the uneducated vulgarity of expression at all. Therefore, one should bear in mind that it is very important to study language in a sociocultural context; the language has existed in close contact with culture. Fro m the example one can know that misusing slang would result in misunderstanding in the communication. It can not tell others that one is good at English. It is not thus; moreover it shows that one just has half-back knowledge about slang. Americans speak colorful, idiomatic English that may have little resemblance to the language one studied in school. Even a native English speaker might be confused by the combination of slang that characterizes American conversation. So it is very important to capture the American slang expression in order to know others correctly. This thesis starts with the analysis of the cultural condition of American slang, and its purpose is to probe into the features of slang so as to bring the relationship between slang and society culture to light. â…  .American Slang is quite a controversial language, people have different attitude toward it. It is no wonder that the definition of slang is so variety. However, the slang terms have their own characters, and, of course, the definitions of it are more or less described in the same way. A. The Definition of Slang Slang is a rather special parole. It is neither the word that beyond the regular role of grammatical usage, nor rural dialect. Although it is quite different from acrolect which used on the formal occasion, people quite like to use it in daily speech. As a matter of fact, the meaning of most slang is similar to the words of colloquial style. Some consider one word is slang, while others might not think so. For example, the old may believe the word bike is slang, but the youth might not .Bicycle is trisyllabic, while bike is monosyllabic, it is so troublesome to pronounce the word with trisyllabic, and of course, the youth prefer to omit some other two syllables, and bike is spoken by the youth more often. To some certain slang, it is hard to tell the differences between slang and colloquial style. One of the definitions of it is, â€Å"the body of words and expression frequently used by or intelligible to a rather large portion of the general public, but not accepted as good; formal usage by the majority† (Flexner, 1975:3).

A Study Of Uncommon Food Allergy Dissertation Example | Topics and Well Written Essays - 3750 words

A Study Of Uncommon Food Allergy - Dissertation Example 1.0. Introduction A true food allergy, according to Duyff (2003), is also referred to as food hypersensitivity, where the immune system to react to harmless substances present in food even though a person is not technically sick. These substances are generally termed as allergens, are usually proteins from some food which sets off the body’s immune system to react by the production of immunoglobulin E (IgE) antibodies. The IgE antibodies activate the release of natural body histamines to counter the allergic reaction. An individual experiences these internal bodily processes as the uncomfortable symptoms associated with allergy, such as itching, running nose, nausea, palpitation, and in worst cases anaphylaxis (Duyff, 2006) Statistics gathered by Duyff (2006) revealed that one in every three adults are allergic to milk, whereas the National Health Institute estimated that only four out of 100 or about 11 million Americans have food allergies. Approximately 60% of the food alle rgies are seafood allergies, and about 30% are peanut and tree nut allergies. The remaining percentage are allergies caused by uncommon food allergens. ... , et al., 2009), mustard (Figueroa, et al., 2005); lupine flour (De Jong, et al., 2010), pomegranate, in the case of this researcher, and many others. Duyff (2006) maintained that food allergies are frequently self-diagnosed, and declared on the basis of popular literature or common symptoms. 1.1. Research Problem A preliminary survey of existing literature demonstrated that studies on allergy and uncommon allergy focused on one or a related group of allergies, or in some studies symptoms experienced and how the uncommon food allergy is managed. Specifically, the following research problems will be addressed: 1.1.1. What are the uncommon food allergies of the respondents? 1.1.2. What symptoms are experienced by respondents who have uncommon food allergies? 1.1.3. What is the level of severity of the symptoms? 1.1.4. How are the allergy and the symptoms managed? 1.1.5. Are there significant differences in the severity of the symptoms experienced and the application of medical interven tions? 1.2. Research Hypothesis The null hypothesis that â€Å"there are no significant differences in the severity of the symptoms experienced and the application of medical interventions† will be tested using a 0.05 level of significance and a two-tailed analysis. 1.3. Terms of Reference The study is being conducted to collate evidence about uncommon food allergy, the symptoms and how the condition is managed. A summary of the findings of existing studies have also been presented. As earlier mentioned, none of the existing studies so far ventured to collate and group uncommon allergy study data. Hence, this library research is important because this is the first study so far which attempted efforts to synthesize existing knowledge on uncommon food allergy in a form which can readily

Discussion Response Essay Example | Topics and Well Written Essays - 250 words

Discussion Response - Essay Example A comparison of sub cohorts by involvement in physical activity however identified lowest relative risk, in odds ratio, at 0.74 among women who involved in active physical activity and relatively high risk factor of 1.02 among women who engaged in less or no physical activity at all. This led to a conclusion that involvement in physical activity by women reduces their relative risk of postmenopausal breast cancer, though this relationship is not significant. A comparison of the relationship among cohorts by body weigh however identifies a significant difference with lean or normal weights associated with relatively lower risks. The post accurately reviews the article, though the figure 32269 was before the exclusion criteria and the actual participants were 1506. The post’s definition of relative risk is also accurate but restricted to the scope of disease susceptibility (Dishman, Heath and Lee, 2012). Its report on the likely relationship between the type of cancer and women’s weight is also consistent with the research findings (Leitmann, 2008) and is supported by published literature that identifies an indirect proportionality between body weight and a woman’s risk of developing breast cancer after her menopause (Courneya and Friedenrich, 2010; Irwin, 2012). The class of women has also reported an inverse relationship between postmenopausal breast cancer and involvement in exercise (Fritz and Speroff, 2010). Leitzmann, M., Moore, S., Peters, T., Lacey, J., Schatzkin, A., Schairer, C., . . . Albanes, D. (2008). Prospective study of physical activity and risk of postmenopausal breast cancer. Breast Cancer Research, 10(5),

E_Week4DQ Essay Example | Topics and Well Written Essays - 750 words

E_Week4DQ - Essay Example The money transfer is done without exposing the account details of the sender to the buyer. On purchase, the money is transferred directly from the buyers account to the sellers account. The transaction can be monitored by the buyer through logging into the Micropay account. In the event of any loss, Micropay refunds the cost of the purchased item and the cost of the initial postage value. This mode of payment offers Privacy, integrity, and non-repudiation and the authorizing entity, in this case Micropay issues the users against any losses. Micropay facilitated payment of large values as well as small values. The cash value accumulated in the Micropay account is transferable to banks and internationally. The system is easy to use and allows users to login and transact business from different locations and computers. One has to register with both EBay and Micropay to be able to utilize Micropay services (Hsiao-Cheng, Kuo-Hua, & Pei-Jen, 2002). How Micropay works Micropay does not pro vide a different way of banking but is just a middleman in the transactional processes. Credit and debit cards transactions travel on different networks. When a merchant a transaction to be made through Micropay, they will do so by paying a small fee which is normally 2 percent of the transaction. There is also an interchangeable fee that is charged for all the companies that take part in the transactions. The fee is universal and is charged for any company that is involved in the process. The part that Micropay comes in is in that both the buyer and the seller deal with Micropay after they have provided their banking details. Micropay then handles all the transactions that will take place between all the banks that will be included and will pay the interchange fee. They will recover the money that they pay for the interchange from the fee they charge for receiving the money. They also get it from the interest they get from the money they left in their accounts (Han Zhang & Haizheng , 2006). I am sure that Micropay will assist us in our e-commerce project in the fact that it will help us to get payments done to various clients. It will also help us secure our money and trust. Their security is trustworthy and we are able to bank on it getting payments and making payments. References Han Zhang & Haizheng, L 2006, Factors affecting payment choices in online auctions: A study of e-Bay traders, Springer, New York. Hsiao-Cheng, Y, Kuo-Hua H, & Pei-Jen K 2002, Electronic payment systems: An analysis and comparison of types, Chiao-Tung University, 1001 Ta-Hseuh Road, Hsinchu 30010, Taiwan IBM Taiwan, Taipei 100, Taiwan Technology in Society. In a 3 to 4 paragraph essay with support from the text theory discuss the following:Â   As a customer, what is your biggest security nightmare and how to you expect the site to protect you? My biggest security nightmare is having our online account hacked and all the funds transferred to other accounts. This will mean that all ou r money for undertaking the e-commerce shall have been lost. Micropay will be of great help in the sense that the online transactions will be secured. Due to the nature of Micropay in the sense that it has all the personal information of many users on the Internet, it has an extra layer of security for the purpose of securing the data it handles on the Internet. The details that it handles include bank account numbers, addresses and credit card numbers. With other online transaction

Oil Production In Saudi Arabia Essay Example | Topics and Well Written Essays - 500 words

Oil Production In Saudi Arabia - Essay Example With these statistics, it is undeniably true that Saudi Arabia’s contribution in the energy industry position’s herself as key player in the global economy. This paper therefore discusses the oil production in Saudi Arabia through understanding its history and development over the years. Statistics derived from organization of the petroleum countries (OPEC) in 2014 showed that Saudi Arabia’s value of exports from petroleum related products to be about $ 321, 723 million, and its current crude oil reserves standing at 265,789 million barrels. In a whole ,oil related products, natural gas reserves constitute about 8317 billion cubic meters. Pushed by the demand for oil of about 1000 barrels per day , Saudi Arabia has increased its production capacity to be about 9637 barrels per day; this is about 2507 barrels per calendar day refinery capacity. Last year, Saudi Arabia’s export earnings came from natural gas with 100030 million cubic meters exported globally (Bronson, 56). Before Saudi Arabia controlled its oil industry, the first king of Saudi Arabia Abd al Aziz Ibn Abd granted oil concession in 1923 to British investment groups who exploited, and utilized the concession granted. It is after the discovery of first oil reserve in 1938 that the concession agreement was changed to Aramco’s concession. It allowed an equal haring of profits between the company and the government on a fifty-fifty basis. With the discovery of large quantities of oil reserves in 1945, the use of pipeline was in evitable. The trans-Arabian pipeline company came into existence owned by Aramco’s group. After completion of the Tapline pipeline in 1950, it did collect oils from fields, and it was able to handle 480, 000 barrels per day. Tapline continued to operate with a number of challenges coming from within and externally and in 1982; it was forced to stop its operations in Saudi Arabia (Branson, 45). After 1982 and