The Construction Of The Modern World - 2135 Words

The construction of the modern world can be attributed to several factors over the past hundred years. The Industrial Revolution marks a major turning point in our history; almost every aspect of daily life was influenced in some way. There were numerous signs economic and socio-economic changes that exhibited unprecedented and sustained growth by new chemical manufacturing and iron production processes. This sustained growth was attained mostly through the innovation and industrialization of ‘technological’ modernization as it set forth the foundation to the continuation and growth of newer processes. Robert Pool, the author of Beyond Engineering, How society Shapes Technology, examines how society has shaped technology – divergent to†¦show more content†¦But for better or for worse, technology has reached the point of where no individual can understand completely how, say a, petrochemical plant works, and no team of experts can anticipate every possible outcome once a technology is put to world† (Pool, 9). Technology since the industrial revolution has become increasingly complex. The impact during technological growth is unknown culturally even to a scientist. The industrialization era has launched an expansive technological evolution; the diversification and implementation of technology has caused rapid transformation of our societal culture. Two decades ago, you would have had to write a letter to communicate with others who live far away. If you missed an episode of your favorite show, you would have had to wait for reruns; and for updates on the news you would have to pick up a newspaper. These are but a few ways the Internet has changed human experience thus transitioning us to our modern world. It was the introduction of technology in use of the Internet platform during this century that has led to a new mode of human existence. In Lee Siegels, Against the Machine: Being Human in the Age of the Electric Mob, he writes â€Å"the Internet is possibly the most radical transformation of private and public life in the history of humankind† (Siegel, 40). The development of the industrial revolution with regard to technological changes has led to transform our

Corporate Governance On The Capital Investment Decision - Free Essay Example

Sample details Pages: 13 Words: 4034 Downloads: 1 Date added: 2017/06/26 Category Statistics Essay Did you like this example? ABSTRACT This paper investigates the factors that determine the sensitivity of the investment-cash flow relationship. The Q model assumption is used to relate the investment opportunities available to the managers with its liquidity constraints due to asymmetric information and managerial discretion of internally sourced free cash flow. The result purports that there is a positive relationship between the degree of the Investment-Cash flow relationship and Q, found in low or no dividend paying firms. Don’t waste time! Our writers will create an original "Corporate Governance On The Capital Investment Decision" essay for you Create order It is evident that the results are in support of Myers Maljuf (Myers Maljuf, 1984) pecking order theory of the investment-cash flow relationship. TABLE OF CONTENTS LIST OF TABLES Introduction Overview Through various studies over the years, different scholars and financial analysts have been able to establish a relationship of cash flow on firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment spending. It was significantly proven by (Modigliani Miller, 1958) that a firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial status is irrelevant for real investment decisions in a world of perfect and complete capital markets, after controlling for the cost of capital. In case of managerial discretion, based on (Jensen, 1986) free cash flow theory, firms increase investment (including projects with negative present value) based on the availability of cash flows with incentive of increasing firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ value beyond level of optimal investment. Moreover, an agency costs also appreciate the borrower net worth by charging a premium on the external financing. The discussion above explains that the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment decisions are dependent on the availability of internal funds, as cost advantage over external fund is evident. While choosing an appropriate capital structure, there are certain trade-offs which affects the decision. These trade-offs include tax advantage through acquiring debt against the bankruptcy cost which advocates the use of equity. Keeping this in view, various different models have been supported to explain this corporate capital structure behavior. Pecking Order Theory, initially mitigated by (Donaldson, 1961) describes the financing practice as prioritizing the means of financing, which is necessary for the management to counter against asymmetric information. Either they should generate the funds internally or acquire funds externally through debt rather than equity. Implications to the pecking order theory involves the positive impact of leveraging on the market price, which means, financing through debt sends a positive signal into the market about the firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s future prospects. Furthermore, intermediaries also undermine the role of management as the financial intermediaries such as investment banks function as the insider to the firm. Consequently, keeping an eye on the firms operations and influencing the firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s capital financing decision. However, Pecking order theory of (Myers Maljuf, 1984) argues that the firms operating in imperfect or incomplete capital markets where the cost of external capital exceeds that of internal funds, the financial structure may be appropriate to the investment decisions of companies facing uncertain prospects. Gauging the level of corporate investment in any firm is based on the corporate governance; market position of a firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s asset against its book value can be termed as Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q ratio. Identified by (Chung Pruitt, 1994), Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q as proportion of firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ market value to replacement cost of its assets. Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q can be considered an effective tool for determining financial performance as the data can be collected readily from a balance sheet. When calculating Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q ratio, the replacement cost can be determined approximately by the book value of firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s plant and equipment. Approximate q can be replaced with the actual Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q to make the calculations unproblematic and data can be readily available without any discrepancies. Problem Statement To study the impact of corporate governance on the capital investment decision through cash flow and Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q interaction in relation with Capital Investment HypothesEs H0: Firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ cash flow having a significant impact on its capital investment will be linked with high Q values. (FCF Theory) HA: Firms being liquidity constrained due to least payout will have significant investment-cash flow sensitivity, and will be linked with high Q values in the market. (PO Theory) Outline of the study The report contains the contemplation of research data that will study the phenomenon of cash flows and investment discussed earlier in this paragraph. The study categorizes firms according to characteristics (such as dividend payout, size) which will help measure the level of constraints faced by firms. The study will help readers to understand the complexities of Pecking order theory and Free Cash Flows concept with regard to asymmetric information available and corporate governance which influences decision of the firms. To measure the effect that cash flow-financed (internally sourced) capital spending and Q has on firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment, Ordinary Least Square Regression model will be used to estimate the function. To compute the influence on the Investment, instruments used are: (1) Cash Flow, (2) Approximate q, and (3) an interaction of both variables are created. Through studying the parameter estimates of interaction variable, positive influence on investment will support the Pecking Order hypothesis and negative influence will govern the Free Cash Flow hypothesis. The equation hypothesized in the next part is linear. Definitions Pecking Order Theory: (Myers Maljuf, 1984): à ¢Ã¢â€š ¬Ã…“A firm is said to follow a pecking order if it prefers internal to external financing and debt to equity if external financing is used.à ¢Ã¢â€š ¬? Free Cash Flow Theory According to (Jensen, 1986), à ¢Ã¢â€š ¬Ã…“free cash flow theory, high cash flow and low debt create agency costs associated with conflicts between manager and share holder over the payout of this free cash, which is the cash left after the firm has invested in all available positive net present value projects.à ¢Ã¢â€š ¬? Capital Structure à ¢Ã¢â€š ¬Ã…“A careful and systematic analysis of how claims against a corporations assets can or should be determined, assessed, and accounted for.à ¢Ã¢â€š ¬? (Riahi-Belkaoui, 1999) Capital Investment Decision à ¢Ã¢â€š ¬Ã…“Capital Investment decisions are those decisions that involve current outlay in return for a stream of benefit in future years.à ¢Ã¢â€š ¬? (Drury, 2006) Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q à ¢Ã¢â€š ¬Ã…“Tobins q is a measure of investors expectations concerning a firms future profit potential. It is defined as the ratio of the market value of a firm to the replacement cost of its assets.à ¢Ã¢â€š ¬? (Strecker, 2009) Literature Review Vogt (Vogt, 1994) explained the capital spending behavior of companies with respect to change in dividend cash paid, cash flows, sales, and market value of assets. The regression equation models the variables to proportion of fixed assets, and distributes the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ data in segments of Dividend Payout Groups and Asset Groups. Primarily, Dividend Cash has a strong negative impact on capital spending; it explains that in order to finance additional fixed investment firm needs to sock cash by reducing their dividend. Cash flow, Sales, and Q Ratio having a positive coefficient demonstrates that with an increase in future cash flows, the firm will improve its capital spending. A relationship has been developed between the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment decision and the firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial status by Cleary (Cleary, 1999), financial status has been studied with respect to the liquidity constraints. The data is classified into groups through a discriminant analysis on basis of dividend payout policy. Groups taken into study have made possible to identify firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ which are more financially constrained more likely to be investment-cash flow sensitive, furthermore, availability of internal sources of funds have a greater impact on firms with high credit worthiness, and vice versa. It has been proposed that the various ownership structures make managerial decision based on the interaction between investment and the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ liquidity constraints. The study conducted by Dedoussis Papadaki (Dedoussis Papadaki, 2010) mentioned that the management can be held separate from its ownership, even on basis of the nationality of the company. On the other hand, it also explained that the relative shareholding of CEO and the controlling shareholders can also be the basis of separation. The sample used in the study was separated and grouped on basis of dividend payout, asset size of the firm, age of the firm, source of control, and kind of ownership. On the given sampling criterion; greater asset size firms, older firms, lower Q (high investment opportunity), and high dividend payout firms showed higher cash flow sensitivity towards investment. Findings support that the Low Q, small, and new firms under the generalized model are facing asymmetric information problems. Indeed these firms are expected a priori to face financing problems that affect the cost of their external financing. On the other hand, low Q, old and low dividend firms are more likely to face managerial discretion problems that result to over-investment. The impact of Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s Q is mainly used to determine the investment opportunity of the firm. In this article, marginal Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s Q has been taken to evaluate the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment and Research Development expenditures. The asymmetric information (AI) hypothesis proposed that firms provided with a profitable investment-project may not be able to source it through internal cash flows and the high financial cost of borrowing funds externally due to lack of awareness of firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment opportunity in the capital market. On the other hand, agency or managerial discretion (MD) hypothesis constructs the investment-cash flow relationship on the assumption that managers are well qualified in context with proficiency they obtain from managing a huge and fast paced firm and thus exceeding the wealth shareholders beyond their expectations. (Gugler, Mueller, Yurtoglu, 2004) Taking in viewpoint the impact of capital structure on the capital investment decision, firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment demands is the more susceptible towards cost-of-capital or tax-based capital incentive. Whereas, capital structure seems irrelevant as against internal sources of funds can be effectively substituted with sources of funds generated externally. The size of the investment project can be a deterministic factor towards it. Fazzari, Hubbard, Peterson, Blinder, Poterba (Fazzari, Hubbard, Peterson, Blinder, Poterba, 1988) explicates that cash flow/investment relationship is more sensitive when taken in reference with firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ dividend behavior. Comparison based on firms having more or less liquidity constraints can be further improved when compared on a division based on the scale of the firms, i.e. young or small firms versus large ones. This way the researchers can address the problem of firms lacking the asymmetric information. Under the impression where capital investments decisions mainly pertains to the capital structure or choosing the appropriate source of investment, Schaller (Schaller, 1993) conducted three different empirical tests to determine that information asymmetries have a huge influence on the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment behavior. Differences among the informational base of investors and creditors was also considered a capital market imperfection. Ownership status and age of the firms has an impact on the cost of equity financing, mature firms pay comparatively less price for it than young firms. Same aspect goes for the firms with concentrated with comparison to dispersed ownership. Borrowing is considered a more rational source for investment-projects. Pledgeable assets generate greater borrowing capacity, which afterwards makes firms invest more in pledgeable assets. As suggested by Almeida Campello (Almeida Campello, 2007), such a phenomenon can be termed as a credit multiplier. In case of financially constrained firms, a multiplier relates to the sensitivity of firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment-cash flow relationship that is reflected as the increase in the tangible assets of the firm. Therefore, it is proposed that with fewer tangible assets firms are more likely to be financially constrained. The sensitivity of investment-cash flow relationship is evidently influenced by the tangibility of a firm, as latter discussed. Managers while making capital investment decision considers externally-sourced funds costlier, therefore, overconfident managers over assessing the profitability of an investment-project invests more when having abundant internal funds to utilize. However, deciding not to source externally in case where they are short of internal funds to generate. There has been an evidence of significant relationship between the managerial discretion and investment-cash flow sensitivity. Equity concentrated firms are more likely to be influenced by overconfident managers, unless compensation tools can be used to reduce the effects of managerial overconfidence. (Malmendier Tate, 2005) Goyal Yamada (Goyal Yamada, 2004) have explained the impact of asset pricing in the stock market against investment-cash flow sensitivity. Overvalued stock prices triggers an increased in investment spending and are cut back when stock are being undervalued, consequently, inflated prices collateral assets attract higher level of external financing. Inflationary pressures primarily determined by the economic monetary policy impacts on the variation of cost on external financing, though it reflects highly on cost of external financing, marginally impacts less on the investment-cash flow sensitivity. It has been observable that less financially constrained firms have significantly higher investment-cash flow sensitivity. Characterizations of firms based on financial constraint can sometimes create confusion. Firms having unusually high cash holdings can either be characterized as unconstrained based on the opportunities it has to invest or constrained based on the assumption that it needs to have a precautionary savings to invest in future investment projects. Therefore, financial constraints cannot be used as an influential determinant for investment-cash flow sensitivity. (Kaplan Zingales, 1997) Hu Schiantrlli (Hu Schiantarelli, 1998) put into picture the effect of general economic factors and various firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ characteristics on the value of the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ net worth. Mainly financial status is the most important determinant for the level of asymmetric information problem that managers face. A strong balance sheet position can reflect good sign of firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ performance which enhances the market value of the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ asset to its stake holders, mainly investors and creditors. Q models assumption also assists in determining the sensitivity of the investment-cash flow relationship, where the indicators determine the investment opportunity and the sources of funds to choose from. Understanding the market influence in proxy of q can also give a clear picture to the movements in the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ investment over a period. Net worth of firms helps manager determine if the sourcing of funds externally is a viable option in contrast to the investment opportunity which underlies. (Hubbard, 1998) Research conducted on the investment-cash flow sensitivity addresses many aspects of the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ financial strength. Further study by Calomiris Hubbard (Calomiris Hubbard, 1995) shows that when firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ tax taken under investigation also reflected a significant influence on the volume of spending on investment-projects. They explored the impact of surtax margin, as a tax experiment, on the cost of internal and external funds. Surtax when levied on undistributed profits, obligate the firms to incur certain cost on the internal funds. This effects the managersà ¢Ã¢â€š ¬Ã¢â€ž ¢ decision to invest and is also reflected on the investment-cash flow sensitivity against the surtax margin. As a result to evade burden of higher cost on internal funds, firms with high surtax-margin exhibits elevated sensitivity in investment-cash flow relationship. Quan (Quan, 2002) discusses the Pecking Order theory with reference to the Modigliana-Miller proposition that works under the assumption of perfect market. Here it is stated that value of the firm is irrelevant and based on a few limitations the choice of financing can be determined via gauging the strength of the firm. These factors pertain to the imperfect market and influence the managers to make their capital investment decision. Once the assumptions are released the financing structure shows a clear picture. The association between Free Cash Flow theory and Agency theory has always been under the limelight when there is a question of retaining the undistributed profits. FCF Theory taken under consideration gives out an option to the management to hold on to excess cash sacrificing the shareholders opportunity cost. These excess funds can be generated to better internal operational efficiency or at managersà ¢Ã¢â€š ¬Ã¢â€ž ¢ discrepancy to source its investment-projects. (Wang, 2010) Research Methods The chapter explains the model used in the given research study. The study focuses on analyzing the influence of Cash Flows and Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q on Corporate Investment. The equation represented by a dependent variable as a ratio of capital spending to the beginning net fixed asset (I/K) predicted by independent variables: (1) ratio of cash flow to the beginning gross fixed asset (CF/K), and (2) beginning Tobins q (Q). Method of Data Collection Main source of collecting the required data is from secondary sources. It includes the Balance Sheet Analysis of Joint Stock Company listed in Karachi Stock Exchange provided by State Bank of Pakistan consisting of data of our relevant variables. The data was taken in annual terms to conduct this research. Sampling Technique The Convenience sampling or grab or opportunity sampling would be use in this research. Sample population selected because it is readily available and convenient. Sample Size The sample period taken under study covers 8-years period beginning at the start of 2000 and ending at the close of 2008. The data was taken from a sample of 70 (non-banking and non-financial) companies which are listed on Karachi Stock Exchange and included in KSE-100 index. Research Model Statistical technique Ordinary Least Square Regression technique is used to study the impact of variables included in the study. It helps studies the relationship between a dependent variable and several independent variable. It also assumes the relationship to be linear or à ¢Ã¢â€š ¬Ã…“straight line,à ¢Ã¢â€š ¬? where the values of predictors lies directly proportional to Criterion variable. SPSS Software is used to develop the regression model and evaluate the influence of predictors on dependent variable. Results Findings and interpretation of results Aggregate Sample: Table : Represents the model summary of regression estimates for the full sample of 69 firms The predictors, i.e. main effects of Cash Flow and Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q and an interaction variable of both combined, included in the model explains 78.5% of Investment (Table 1) shown mentioned as R Square. Least variation in Adjusted R Square suggests that the variable to observation ratio in the given model is sufficient. Casewise diagnostic was also conducted to eliminate the outliers in the data to improve the results. Table : Studies the F-statistics to test whether the model predicts the dependent variable significantly The F-statistics (Table 2) is significant and it determines the regression model with the given predictors can significantly predict the outcomes at a 0.05 significance level. Table : The parameter estimation for full sample of 69 firms with respect to dependent variable, t-statistics is used to test the null hypothesis ÃŽÂ ²1 = ÃŽÂ ²2 = ÃŽÂ ²3 = 0 The coefficient values of all predators included in the test are significant at a 0.05 significant level (Table 3), which shows that they have a strong influence on the investment of the firm. The standard coefficient shows that Cash Flows have a much greater impact on Investment than market value on the firm, which is exemplified through Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q. Dividend Payout groups: Table : Presents the sample statistics for 69 KSE listed (non-banking and non-financial) companies which are included in the KSE-100 index. The three rows distribute the statistics into High, Medium, and Low payout policies. Average dividend-to-income ratios of greater than 0.35, between 0.35 and 0.10, and less than 0.10 define High, Low, and Medium dividend-payout firms, respectively. While studying the dividend-payout groups (Table 4), the descriptive helps to identify characteristics to confirm whether the data being studied has the authenticity and the behavior pattern which commonly related to the groups assigned. The values of Investment, Cash Flow, and Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q associated with the groups are in complete correspondence with the hypothetical occurrence. Firms having a higher (lower) dividend payout have greater (lower) market value, and lower(higher) level of cash flows and investments. Table : Represents the model summary of regression estimates of 69 firms split by High, Medium, and Low dividend-payout policies. The model helps explains 81.9%, 66.7%, and 80% data in High, Medium, and Low dividend-payout firms (Table 5), shown in R Square. Least variation in Adjusted R Square suggests that the number of observations is sufficient with respect to variables in each group separately. Table : Studies the F-statistics to test the null hypothesis of ÃŽÂ ²1, H = ÃŽÂ ²1, M = ÃŽÂ ²1, L The F-statistics (Table 6) in each dividend payout group is significant and it determines that each regression model with the given predictors can significantly predict the outcomes at a 0.05 significance level. Table : Shows the parameter estimation for each payout groups with respect to dependent variable, t-statistics is used to test the null hypothesis ÃŽÂ ²1 = ÃŽÂ ²2 = ÃŽÂ ²3 = 0 The coefficient values of predators in High and Low dividend payout groups are all significant at a 0.05 significant level (Table 7), which shows that they have a strong influence on the investment of the firm. Except for Medium dividend payout group, which has insignificant coefficient values of Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q, showing no impact on the investment. The standard coefficient shows that Cash Flows have a much greater impact on Investment than market value on the firm, which is exemplified through Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s q. Hypothesis Assessment Summary Hypothesis Independent Variables B t Sig. Comments Firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ cash flow having a significant impact on its capital investment will be linked with high Q values. (FCF Theory) Cash Flow ÃÆ'— Q H0: ÃŽÂ ²3 0 ÃŽÂ ²3,H = .135 5.295 .000 Rejected ÃŽÂ ² 3,M = .072 .991 .324 ÃŽÂ ² 3,L = .140 5.482 .000 Firms being liquidity constrained due to least payout will have significant investment-cash flow sensitivity, and will be linked with high Q values in the market. (PO Theory) Cash Flow ÃÆ'— Q HA: ÃŽÂ ²3 0 ÃŽÂ ² 3,H = .135 5.295 .000 Accepted ÃŽÂ ² 3,M = .072 .991 .324 ÃŽÂ ² 3,L = .140 5.482 .000 Dependent Variable: Investment (I/K) Table : Summarizes the results and explains that the hypothesis accepted is directly in correspondence with the aggregate hypothesis. As illustrated (Table 8) capital spending of low payout firms is positively and strongly influenced by the interaction term, consistent with the PO hypothesis, the parameter estimate for the high payout firms are also positive but marginally significant. Conclusion, Discussions, Implications And Future Research Conclusion The results illustrated above demonstrates that the positive relationship between the degree of the Investment-Cash flow relationship and Q represented latter in the aggregate data (Table 3) is concentrated in low or no dividend paying firms. This finding is in further support with the PO hypothesis. Discussions The objective was to study and test the causes of universal relationship between Cash Flow and Investment Spending. Hence, two hypotheses were included in the research to study the source of this relationship: the free cash flow hypothesis (FCF) hypothesis, which works on the assumption that managers prefer investing its free cash flow excessively into investment projects that are not profitable, and the pecking order hypothesis (PO) purports that managers are prone to investment comparatively less than the opportunity provided due asymmetric information-induced liquidity constraint. As advocated in favor of Pecking Order Theory by (Fazzari, Hubbard, Peterson, Blinder, Poterba, 1988) and many others, for groups which consists of small firms with low-dividend payout to fund capital spending, exhibits heavy reliance on cash flow and cash changes. The relationship can be more significantly studied when the impact of larger q value is associated with this group. Evaluating the impact of corporate governance on investment-cash flow relation requires a critical judgment as to how do the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ cash flow and the existing market value influence the investment decision. Financially constraint firms may have a larger impact on liquidity associated matters and managers might take discretion in choosing the right sources to tap. Agency cost may be involved in making such a decision where managers may consider paying dividend as a higher opportunity cost as it reduces the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ free cash flow to exploit new profitable investment projects. Implications and Recommendations In the current market situation where external pressures existing can also be taken into proxy. When managers making a capital investment decision they need to take in view other non-financial aspects that also influences the decisions to a certain extent. Furthermore, financial intermediaries having a certain level of involvement and sharing information sensitive to the market can also be a major factor that might be giving a varying result against Investment. Investing in profitable-investment projects can bring in greater resources to the firm in future and it entails a huge decision burden upon the shoulders of the managers. Shareholders expecting to earn a greater return through investing in them can also be undermined when manager decided to have a low payout policy. Funds generated internally is a possibility where there is a healthy cash flow, but it is also preferable if this free cash is invested into marketable security for allocating the resources into a profitable venture for a time being to make it a positive impression. Future Research In future studies there may be more aspects of cash flow-investment relationship which can be studied for assessing the degree impact it has on this relationship, i.e. sales, debt performance, capital structure, firm size, etc. The research study may also be improved if the observation of firms are increased that will in turn reflect a more clear picture about the relationship in the current scenario.

Women in the Odyssey Free Essays

Women in The Odyssey After following an epic that revolved so completely around men, The Odyssey has quite a lot of female roles. True, the ancient Greeks had a better androgynous balance than other civilizations, and this is reflected very clearly in The Odyssey. Femininity has not only a bigger role in this epic, but it seems as though it is honored with its own unique power. We will write a custom essay sample on Women in the Odyssey or any similar topic only for you Order Now This is shown in characters like Circe and Athena, but also subtextually in the many female weavers throughout the story. Overall, women and feminine power have a very influential role in the plot of the Odyssey. Let us begin with the obvious female powers in the immortal goddesses and nymphs. As far as the Olympian Gods, Athena is by far the most involved, regardless of gender. This is made very clear, for example, we see Telemachus preparing for his journey, â€Å"When they had made fast the running gear all along the black ship, then they set up the mixing bowls, filling them brimful with wine, and poured to the gods immortal and everlasting, but beyond all other gods they poured to Zeus’ gray-eyed daughter. † (2. 430-433) Also, Calypso and Circe play the role of â€Å"Women as Temptress† which greatly hinders Odysseus’ journey. Circe especially has those powerful witch qualities that the uses specifically against the male gender. Luckily, however, she learns compassion for Odysseus and the crew in general. Thus she becomes not only kind but actually a very helpful component in the overall voyage. Calypso needed more convincing about releasing Odysseus, but afterwards she also became somewhat helpful. Other helpful supernatural women appear such as the water nymph, Ino, who saves Odysseus from drowning on his way to the Phaecians. Already we see a huge increase in female importance and their affect on the plot. One of the biggest reflections of ancient Greek culture is the amount of weaving done by the women. However, I think that the images of weaving in the Odyssey have little to do with making a cultural point. In Greek mythology, everyone’s destiny was weaved by the Fates. I think that because of that, weaving has many connections to destiny. This even transfers into the literal sense, from baby blankets to death shrouds. Thus, the women in the epic who are seen weaving are technically weaving the destinies of the characters of the story. Let’s start with Penelope, for her image of weaving is very specific. She weaves by day and â€Å"by night, with torches lit beside her, she would unravel all she’d done. † (2. 106-107) This represents the fact that she keeps her life monotonously the same, and refuses to allow her life/destiny/weaving to progress. We see another very interesting image of weaving with Helen. She is making her yarn, which the preparation work before the actual weaving. To me this means that she was the one who informed the destinies before anything even took place in the Odyssey. Her decisions before and during the Iliad were her major contributions, as she set the stage for the female weavers of the Odyssey. These weavers also include Calypso and Circe, who we have already decided are major parts in the book. There are a few more women in this epic who really deserve to be mentioned. Two of them are Phaecians, Princess Nausicaa and Queen Arete. Nausicaa, inspired by our goddess Athena, really helped Odysseus. In her curiosity and level-headedness, she helped Odysseus return to her palace and find the help and support he needed to return home. Once he arrived there, he met with Arete, and it was she who Odysseus chose to plead hospitality, â€Å"flung his arms around her knees,† (7. 167) instead of her husband (the king). From the moment I read this, I thought that Arete must be a very powerful and respected woman, especially if she has power over decisions like that. Another woman I found very influential was Eurycleia. She practically raised both Odysseus and Telemachus, making that bond/parallel between father and son even clearer. She is also the only person to recognize Odysseus before he meant to reveal himself to her. However, when she saw his unmistakeable scar, she â€Å"let his foot fall, down it dropped in the basin-the bronze clanged, tipping over, tipping water across the floor. † (19. 530-533). This uninherently shows her wisdom and compassion at an old age. Another (somewhat graphic) image of women in the Odyssey is the maidens that were hung across the rope by their faces at the end of the battle. This shows the flipside of feminine power, as these are the women who didn’t advocate for themselves or their masters in the least, but decided to live a lazy life of gluttony and pleasure instead. The last woman I would like to mention is Odysseus’ mother, Anticleia. We only get to see her as a shadow, which is the least powerful state of any woman throughout the epic. However, she still stirs a deep emotional response out of Odysseus, which, in turn, most definitely affects the actions he takes and thus the plot as a hole. Overall, I think that women play a very inspiring role in this epic. The show us time and time again that each of us is powerful enough to help write or own destinies, and to be cooperative components in the lives of others. We see again that compassion trumps hatred, and that being helpful is better than being selfish. Setting someone you love free can not only just turn out for the best, but it also might just be what needs to happen in the fate of their life. How different would the story be if Odysseus wasn’t eventually allowed to leave Aeaea or Ogygia? So in conclusion, the women of the Odyssey show us to be present and compassionate in our lives, because who knows? You may just have a lasting effect on the life of another. How to cite Women in the Odyssey, Papers