Elements For The Judgment Finance Essay - Free Essay Example

Sample details Pages: 5 Words: 1360 Downloads: 4 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? Voluntary risks are considered less troublesome than involuntary risks. One of the biggest arguments for it is that people tend to use tobacco irrespective of its known risks while in case of plane crash, public reaction is exceptionally high. In the same way risk perception of an expert and layman is very different. Starr characterized risks into voluntary involuntary. Voluntary risk is the risks in which participant or the risk taker takes risk by choice. When an individual takes risk by its choice it is more acceptable for him it is because of the reason that voluntary risk is takes by the individuals own value system experience. While involuntary risks are associated with such activities or situations which are not taken by the choice of the individual rather it is imposed on him without his consent. Starr found out that individual tend to accept those risks with are attributed with benefits hence he termed those risks with voluntary risks. Starr did an extensive research on that concluded that people tend to accept voluntary risk 1000 times more than involuntary risk (Starr, 1969). Don’t waste time! Our writers will create an original "Elements For The Judgment Finance Essay" essay for you Create order According to renn (Renn, 1990)individual perception of risk is more satisfying it he chooses the risk voluntary instead of the risk which has been imposed on him. Individuals accept voluntary risk more than involuntary because it gives them a sense of freedom hence voluntary risk is often attributed as chosen risk because when people perceive that specific form of investment yield higher returns they chose accept high risk. Secondly individuals take voluntary risks because they have relevant knowledge information available to them i.e. They have more knowledge information about any form of investment than the other whereas lack of information provides a legitimate case for not involuntary risk because with lack of information or knowledge about the risk can be costly for people to avoid. Another approach leading to voluntary risks is presence of alternatives i.e. when an investor rejects less attractive alternatives he is going for a chosen risk which he thinks is most acceptable for him (Wang, 2009). Financial knowledge of the investor may influence a wide range of behaviors like voluntary participation of risk his choice of portfolio. It also helps in determining whether the person is certain or uncertain about a risk. Certainty itself is a psychological construct; if a person has a complete knowledge then he will not have any uncertainty towards a risk (Sjberg, 2004) And if you are uncertain about a risk, uncertainty itself is perceived as a risk. Financial knowledge is a knowledge that is learned, organized is represented to make reasonable decisions about their investment plans or choice of investment portfolio they want to make i.e. whether highly risky or less risky. Investors have to update their knowledge to make better investment plans. Research indicates that there are two types of financial knowledge: objective knowledge subjective knowledge. Objective knowledge includes the financial knowledge which investor possess the updating of that knowledge via effective deliberation. While the subjective knowledge is the knowledge which investor interpret him based on his personal experience. For the purpose of validity, objective knowledge is considered more valid than subjective knowledge although for reliability purpose many investors rely on their subjective knowledge as it represents how confident an investors is towards his choice of investment decision (Steel, 2002). In traditional economies people tend to make their investment funds based on the benefits associated with them only while in todays economy with the inclusion of financial management people take decisions based on their own ultimate benefits by choosing between a mix of defined benefits investment plans undefined benefits investment plans. People tend to accept those risks more which have clear benefits in comparison to those who have little or no benefits. But it is to be kept in mind that if an investor wants to have a higher return, he must bear a higher risk i.e. higher the risk higher will be the return on his investment. It is because of this reason that investors have been classified as risk taker risk averse, high risk taking investors clearly do not take higher risk for the sake of risk itself but because the monetary other clear benefits associated with those risks. For an investor determined a clear reward associated with a risk, he voluntarily accepts even very high ri sk. While choosing between different alternatives or having a diversified portfolio involves choosing between perceived risk-benefits combinations (Sachse, 2012) Basic investors do not consider growth securities firstly because of their fluctuating nature as it is only suitable for investors who look for capital gains over the long term and are willing to take high risk, secondly although it ensures ownership in the company, whose shares have been bought, but in case company liquidity shareholders claims are fulfilled in the last. For this reason, investment in shares is usually done by investors who are high risk takers. Investors who are low risk takers choose risk free securities such as Government securities which has fixed rate of return over a long term period. As these securities incorporate fixed rate of return hence they are free from any uncertainty. Hence mostly low or moderate risk takers invest in such securities (Diacon, 2002). control Risk factors that can be controlled by the individual himself are considered as controllable risks as they can be controlled with ones behavior e.g. by avoiding smoking one can avoid the risk of getting cancer. Not all type of risks can be controlled or changed by the individual, such risks are known as uncontrollable risks e.g. heredity diseases cannot be prevented by ones own will, similarly no one can change or control the obvious diseases resulting from old age while in some cases like in investment decisions one can protect himself from huge losses by doing risk assessment first (Groth, 2004). From an organizational point of view controllable risks are the internal risks that can be changed, controlled, avoided or even eliminated e.g. monitoring employees behavior on regular basis to avoid any illegal action that can cause loss to the company. Whether a company or individual controllable risks for both is best managed through prevention i.e. by actively monitoring operational processes, their investment portfolios, their decision behaviors etc. for this reason controllable risks are also called preventable risks. Some risks arise from such events which cannot be controlled, prevented or monitored to be influenced. Natural political disasters in a country effects all the sectors of that country hence they can only be identified by cannot be controlled e.g. world recession of 1930 hit every financial sector very badly but this recession couldnt be controlled due to some reasons although they were mitigated but not fully prevented. These risks are uncontrollable risks are also known as external risks (Kaplan, 2012). Risks can be controllable or uncountable, price fluctuations in commodity prices is generally not considered controllable due to some of the market factors which cannot b controlled although it can be mitigated by increasing or decreasing ones exposure to the risk e.g. if a lay man wants to invest in the business he can mitigate the risks by hiring a broker for himself instead of doing investments on his own (Fragnire, 2007). If people tend to perceive that they have control over the risks associated with their investments then such risks are more acceptable for an investor or they are more willing to take such risks. An individual tends to have a control over the risks of its investment if he can mitigate or eliminate the risks. While controllability can also be confused with illusion of control in which individual tend to consider his perceive risk lower than actual because they think they have control over their investment risks, while in actual they dont. Because of these factors investors tend to take high risk investment products, rather they are more willing to accept greater risk than others hence controllable risks are classified as those risks which we can influence or mitigate, while uncontrollable risk factors are those which cannot be influenced (Doss, 2012).

The Relationship Between Bullying And Suicide Essay

I feel State and Federal laws should be put into place to prevent bullying it would hold the bullier more accountable for his/her actions. The relationship between bullying and suicide is complex. Many media reports oversimplify this relationship, insinuating or directly stating that bullying can cause suicide. The facts tell a different story. In particular, it is not accurate and potentially dangerous to present bullying as the â€Å"cause† or â€Å"reason† for a suicide, or to suggest that suicide is a natural response to bullying. We recommend media not use the word bully-cide(stopbullying.org). All though suicide due to being bullied can not be identified as a crime studies 7 to 9% are more like to consider suicide because of bullying. â€Å"While there is no definitive evidence that bullying makes kids more likely to kill themselves, now that we see there’s a likely association, we can act on it and try to prevent it,† said review lead author Young-Shin Kim, M.D., assistant professor at Yale School of Medicine’s Child Study Center.(www.medicine.yale.edu) Prevention starts at home , children should have it instilled in their minds what bullying may do to someone even themself if bullied. Most bullying starts in grade school with just name calling and throwing of objects , as we progress in age the bullying may get worse. All though Bullying is not illegal there are anti-bullying legislations in 49 states. 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Causes for College Dropouts free essay sample

For a lot of reasons, we really want people to graduate these days, however; getting people to graduate is not easy. Thousands of students attend college every year, and unfortunately, not all of them succeed in graduating. As, Mara Tyler says, â€Å"A student is more likely to drop out whether for a semester or permanently if he is not able to strike a healthy balance with work, school, social activities and family† (Tyler). Many students find it hard to balance work, life and school especially in a time where finding jobs are difficult and there is more to getting a job than just schooling. Three of the main factors to why students are dropping out of college are causes outside-the-classroom. Many students end up getting the job they want and, because of this, drop out of college. In many cases, students who work during college gain promotions to high-paying positions before graduating. We will write a custom essay sample on Causes for College Dropouts or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Also, students take internships in college that turn into jobs. Since most colleges require a minimum number of courses, school forces students to work fewer hours or give up the chance at a promotion (Tyler). Mark Kantrowitz says, â€Å"Nearly three-quarters (71%) of students who dropped out of college said that work contributed to the decision, with more than half (54%) identifying it as a major factor. About a third (35%) said that balancing work and school was too stressful† (Kantrowitz). Therefore, students end up putting college on hold to pursue their job opportunities. Once a student has a position in the field he desires, he may or may not return to school to finish his degree. For students, the freedom and excitement of being on their own can be too much. Sure, there are perks to college life, such as being able to come and go as you please, eat and drink what you want, and take naps in the middle of the day. But without structure, your good times can come with unpleasant side effects like the â€Å"freshman fifteen† or disciplinary actions and academic probation. Donald J. Foss identifies loneliness and isolation, alcohol, time management, and studying as factors that can trip up students. Foss says, â€Å"A second source of high voltage shocks to college commitment comes from bad decisions about what is important—in shorthand, the alcohol problem. Many students stay up too late, engage in binge drinking and possibly other substances, and over-commit to social activities†¦ Alcohol is still the #1 drug problem on college campuses—schools with a party reputation, fully 60% of freshman drink† (Foss). Drinking, staying up late, and blowing off classes to the point where the student is too far behind to make up for the slack can lead to dropping out. Another reason students drop out of college is a lack of money; many students cannot afford to pay for their classes, fees, and books. Mark Kantrowitz says, â€Å"Other major reasons for leaving school included affordability of tuition and fees (31%)† (Kantrowitz). Unless students have financial help from family or are lucky enough to get scholarships or grants, they are often forced to take out loans or work part- to full-time to pay for school. Often times, students cannot afford the cost of living while trying to complete a college education. So because the cost of college on top of other expenses is so high most students do not feel as though they can afford college and end up dropping out. Not all students succeed with graduating college because of these examples and many other different reasons. Students are finding it harder and harder as the years go on to maintain structure in their busy lives and keep up with college. Every year the number of college dropouts increase and will continue to increase because of these factors. Students without financial burdens, who know how to handle their newly found freedom and job, are the kind of students that graduate in college. Even students with one or two of these problems can graduate college if they really work hard. Students with the proper skills, knowledge, and attitudes can tackle college and graduate.