Sunday, October 6, 2019
Models of Consumer Behavior Essay Example | Topics and Well Written Essays - 500 words
Models of Consumer Behavior - Essay Example The economic situation of the consumer determines the washer or dryer one is going to purchase. The higher the disposable income, the more likely the individual will prefer a high-end Whirlpool washer and dryer and vice versa. Role of involvement in purchase decisions Consumers tends to illustrate high involvement with Whirlpool washers and dryers since these products form a crucial component of their lives. The consumers have to determine between various Whirlpool washers and dryers before reaching a purchase decision. The post-purchase behavior of these consumers involves a more critical evaluation of the different features and benefits offered by the various whirlpool washers and dryers. Due to the significant differences identified with the washers and dryers and the high involvement of consumers purchasing these products, the consumers display a complex buying behavior. The consumer has to determine between various product differences including the top loading or the front loadi ng and the different capacities for the washers and dryers. The high involvement and the complex buying behavior are associated with products that are infrequently purchased such as the Whirlpool washers and dryers. The consumer seeks all the relevant information before determining the specific Whirlpool washer or dryer they hope to purchase. Consumer decision-making process Whirlpool marketing strategies have to influence the eight steps associated with the consumer decision-making process when deciding to purchase a washer and dryer.
Friday, October 4, 2019
Flannery O'Connor Essay Example | Topics and Well Written Essays - 1500 words
Flannery O'Connor - Essay Example Often, Oââ¬â¢Connorââ¬â¢s stories came to reflect a non-secular nation at war with itself, although many of her works focused on the fictional tale of one family, who happens to be directly affected by this conflict (with the occasional murder). Even today, as the intertwining aspects of violence and religion continue to appear across Americaââ¬â¢s newspapers and our awareness of the world, Oââ¬â¢Connorââ¬â¢s works tap the underlying issues plaguing many peoples since they were first written. Flannery Oââ¬â¢Connor spent the earliest and latest years of her life residing in Georgia. Although she was a devout Roman Catholic, her 1955 short story ââ¬Å"Good Country Peopleâ⬠followed the lives of a protestant family and one ââ¬Å"naà ¯veâ⬠Bible salesman. This particular story follows Hulga Hopewell, a PhD in Philosophy, who swore off many of the non-intellectual aspects of the world, including the affection of men. But, when a Bible salesman saunters into town to preach for his own prophet, she decides that despite her limited experience with the opposite sex (since she had never been kissed), she would seduce the boy, believing he was simple and inexperienced when it came to love. When she proceeds to exert her dominance, she begins to succumb to the notion of love and affection (even allowing him to remove her wooden leg, which was dismembered when she was an adolescent). But then she refuses to take the next step in their fiery short relationship, so he s natches her leg and stuffs it into his suitcase, and leaves Hulga behind. However, despite the differences between Oââ¬â¢Connorââ¬â¢s personal beliefs and those of her characters, numerous similarities exist between the author and her work. The main character Hulga and Oââ¬â¢Connor remain comparable on several levels. They were both intellectuals who also suffered from debilitation, as Helga has a prosthetic leg and Oââ¬â¢Connor was stricken with lupus, which
Thursday, October 3, 2019
The Human Body - Data Made Flesh Essay Example for Free
The Human Body Data Made Flesh Essay The title of this essay derives from the words uttered by the protagonist, Henry Case, in William Gibsonââ¬â¢s novel ââ¬ËNeuromancerââ¬â¢ (1984). This metaphor, which equates the human body as mere data turned into flesh encompasses the theory that in an age of increasing focus on information technologies and the ways in which people interface with them, the boundary distinguishing an individual from their surroundings becomes blurred, if not shattered entirely. As University of Chicagoââ¬â¢s William Fulton attests, we exist simply as information systems that happen to inhabit the material instantiation of our bodies, (Theories of Media, 2007). However, one cannot enter discussion about the above topic without first alluding to the particular school of thought which harbours critical theory of this ilk. Exponents of this style of dictum would usually come under the banner of ââ¬ËPosthumanistsââ¬â¢. The term itself, ââ¬ËPosthumanismââ¬â¢, is steeped in hyperbole in that it carries with it an ominous sense of foreboding in contemporary culture, where there is a strong case for the premise that society is becoming less ââ¬Ëhumanââ¬â¢, as we retreat behind the veil of technology. To draw upon the direct translation of ââ¬Ëpostââ¬â¢ as ââ¬Ëafterââ¬â¢ would infer the meaning, ââ¬Ëafter-humanââ¬â¢ which in some respects gives us a clearer understanding of the concept, as it tends to deal with the modern development of the integration of technology and biology and the human body. It is basically a notion that we, as humans are becoming increasingly embedded in technology and the technological environment that, in a sense, the paradigm of the ââ¬Ënaturalââ¬â¢ human being has shifted in meaning. Juxtaposed with this is the idea that as humans are more and more subsumed in technology, technology is becoming more and more human with advances in science and Artificial Intelligence (AI). Fukuyama advanced the concept of Posthumanism as a negative case: that of ââ¬Ëanti-humanismââ¬â¢ or absence of humanism. He bemoans the transgression of ââ¬Å"crucial moral boundariesâ⬠that have eroded the ethical distinctions between therapy and technological enhancement (Our Posthuman Future 2002). Gordijn Chadwick describe a posthuman as a being that has at least one posthuman capacity i.à e. a general central capacity greatly exceeding the maximum attainable by any current human being without recourse to new technological means (Why I Want to be a Posthuman when I Grow Up, 2006). Mc Luhan did not use the exact word but he predicted a future that dovetails succinctly with posthuman theories surrounding ââ¬Ëcyberneticsââ¬â¢ when he foretells a society whereby to paraphrase Haylesââ¬â¢ theory of ââ¬Ëreflexivityââ¬â¢ (1999) that which has been used to generate a system is made to become part of the system it generates. McLuhan alluded to the ââ¬Ëcyberneticââ¬â¢ possibility of human beings interfacing and entangling with machines on a neurological and functional level. Just as binoculars are an extension of the eye and clothes are an extension of the skin, then information technologies become McLuhans extension of the mind. In this respect, the term ââ¬Ëpost-humanismââ¬â¢ has only really worked itself into contemporary critical discourse in the humanities and social sciences since the mid 1990s, over a decade after Mc Luhanââ¬â¢s death. However, it may be traced back to the Macy conferences on cybernetics from 1946 to 1953 and the invention of systems theory (What is Posthumanism? , Wolfe, 2010). At these conferences they converged on a new theoretical model for biological, mechanical and communicational processes that removed the human and Homo sapiens from any particular privileged position in relation to matters of meaning, information and cognition. The term ââ¬Ëcyberneticsââ¬â¢ had been coined by Wiener in the 1940s to denote ââ¬Å"the entire field of control and communication theory, whether in the machine or in the animal.â⬠Even at this early stage of technology there was a definitive study underway into the correlation of information between machines and living creatures. In the 1960s this theory was modified into the concept of ââ¬Ëreflexivityââ¬â¢ alluded to above. Systems re-entangle with themselves, and become referential to themselves blurring the traditionally accepted borders imposed on the world between subject and object, object and environment, or in other words between the organic and the natural and the technological and the cultural, a principal tenet of modern posthumanist thought. In current popular use, Fulton describes cybernetics as most often associated specifically with the development of artificial intelligence, virtual technology and cyberspace. He attests, ââ¬Å"cybernetics in the context of technology is only a limited part of a greater whole, which deals with the study of information systems and the media in which they exist, both inorganic and organic. â⬠Further and further extension of the idea leads to a model of the world in which media serve as a series of ââ¬Å"irrelevant substratesâ⬠through which pure information freely flows. This situation ties in with many of Mc Luhanââ¬â¢s ideas about media in society but most especially with his ideas about the extension of the mind, extending human beingsââ¬â¢ central nervous systems into electromagnetic technology, a topic, I will consider later in the essay. There is much critical opinion to support Gibsonââ¬â¢s notion of humans as information systems just like a machine or computer. Clark (Natural-born Cyborgs, 2001) believes that it is by virtue of our intrinsic ability to merge with external resources to perform even the most rudimentary of calculations that we are designed to walk hand in hand with technology in a posthuman future. He offers the example of how we utilise pen and paper to work out moderately complex mathematics, storing the immediate results outside the brain and then repeating the pattern until the larger problem is solved. ââ¬Å"It is because our brains, more than any other animal on the planet, are primed to seek and consummate such intimate relations with non-biological resources that we end upâ⬠¦ capable of abstract thought. â⬠¦we are natural-born cyborgs forever ready to merge our mental activities with operations of pen and paper and electronicsâ⬠¦. â⬠(Clark, Natural-born Cyborgs, 2001) Wiener asserted that we have to become technophiles to operate in a technological world (1954). He noted that because we have modified our environments so radically it is now necessary to modify ourselves in order to exist in this new environment. Furthermore, he equated the now routine breakdown and repair of the human body with that of replacing a faulty part in a machine. With contemporary advances in technology allowing us to alter or perfect many undesirable parts or areas of our bodies with a specifically manufactured replacement it begs the questions, what does it mean to be human and what does it mean to be a machine in the 21st century? ââ¬Å"If corneal implants are part of us, why not contact lenses? If contacts, why not eyeglasses? If eyeglasses, why not automated telescope? If a telescope, why not the computer interfaced with it? (Hayles, Designs on the Body: Norbert Wiener, Cybernetics and the Play of Metaphor, History of Human Sciences, Vol, 3 No 2) Mc Luhanââ¬â¢s adjunct to this concept is: if a telescope can be the extension of the eye, then information technologies can become extensions of the mind. He stated that after extending or translating ââ¬Å"our central nervous system into the electromagnetic technology, it is but a further stage to transfer our consciousness to the computer world as well.â⬠The Internet clearly serves as the next step in this process of extension. By connecting all computers as part of a pervasive, global network of information, man is not only able to extend his nervous system to interface with technology, but is able to use that mediation to directly connect with the nervous systems of other human beings, also tapped into the network. Present day studies are also showing humanââ¬â¢s capacities to monitor their bodies in the same way that one might monitor a car for potential faults. With one report (The Quantified Self: Counting Every Moment, 2012 ) attesting that more people are using smartphone and tablet applications to monitor their health in an effort to sustain a healthy life-style but also, in many instances, as a substitute for the much more expensive trip to the doctor. As populations age and health-care costs increase, there is likely to be a greater emphasis on monitoring, prevention and maintaining ââ¬Å"wellnessâ⬠in future, with patients taking a more active role an approach sometimes called ââ¬Å"Health 2.0â⬠(The Quantified Self: Counting Every Moment, 2012 ). Allied to this is the plethora of people who are undergoing voluntary surgical procedures in order to modify particular parts of their body for a number of different reasons, in the same way someone might change the wheels on their car or update the driver in their personal computer. Converse to the problem of humans becoming more like machines is the question also raised of machines becoming more like humans. If human identity has been reduced to an information system that happens to inhabit the body as medium, whats to say that another information system inhabiting a computer, or the Internet, couldnt be perceived as being equally as ââ¬Å"human? â⬠In a recent article (Mind vs. Machine, The Atlantic, 2011) Brian Christian describes an annual contest between the worldââ¬â¢s most advanced artificial-intelligence programs and ordinary people. The contest, known as the Turing Test(, endeavours to find out whether a computer can act ââ¬Å"more humanâ⬠than a person and Christian discovers that the march of technology is not just changing how we live, it is raising new questions about what it means to be human. He realises that convincing the judges that you are human ââ¬Å"is about more than simply showing up [and being yourself]â⬠. It is something that has to be ââ¬Å"worked at. â⬠This notion has certain resonance for society as a whole. With this in mind, I recall a report (Makwana Irwin-Brown, Weââ¬â¢re the Kids in Austerity, 2012) I came across some months ago which stated that 57% of 7-15 year olds in the UK find it easier to talk with friends online than in person, 56% find it easier to talk by SMS than in person. These figures represented for me a sea change in the emphasis on ââ¬Ënaturalââ¬â¢ human interaction, and in what it means to be a ââ¬Ënaturalââ¬â¢ human in todayââ¬â¢s society. Perhaps, we are envisaging a new beginning for society one where children feel more comfortable interacting with technology than they do with their fellow human beings. To understand why our human sense of self is inextricably linked with computers, itââ¬â¢s important to realise that computers used to be human. From the mid-18th century onward, computers, many of them women, were on the payrolls of corporations, engineering firms, and universities, performing calculations and numerical analysis. In the mid-20th century, as the ââ¬Ëdigital computerââ¬â¢ developed, it was said to be ââ¬Å"like a computer. â⬠In the 21st century, it is the human mathematical whiz who is ââ¬Å"like a computerâ⬠(Christian, Mind vs. Machine, The Atlantic, 2011 ). In a strange but significant turn of events, humans are said to be ââ¬Å"likeâ⬠something that used to be ââ¬Å"likeâ⬠us. By this reasoning, one could assume that the modern-day computer is so-called because it is intended to carry out any operations which could be done by a human computer. During the same period that gave rise to the human computer, there too, was much debate amongst philosophers surrounding the idea of what it was to be human. French philosopher Julian Offray de la Mettire (1747) suggested that human beings are only complex animal-machines. This suggestion was, in no doubt, inspired by Descartes uttering in the 16th century that the body was essentially like a machine, pointing out that the only thing not reducible to mechanism is the human mind. Furthermore, the notion of man as a machine or machine-like was something that resonated during the Industrial revolution of the 18th and 19th centuries. Ferguson describes the perception of the plight of the factory worker in these times: ââ¬Å"Many mechanical acts require no intellectual capacity. They succeed best under a total suppression of sentiment and reasonâ⬠¦..à Manufacturers, accordingly, prosper most where the mind is least consulted, and where the workshop may, without any great effort of the imagination, be considered an engine, the parts of which are men. â⬠(Ferguson, An Essay on History of Civil Society, 1767) The question of human identity being reduced to an information system that happens to inhabit the body as medium has been a driving force for the study of artificial intelligence, and has manifested repeatedly. As Christian puts it some people imagine the future of artificial intelligence as a kind of heaven: ââ¬Å"Rallying behind an idea called ââ¬Å"The Singularity,â⬠people like Ray Kurzweil (in The Singularity Is Near) and his cohort of believers envision a moment when we make smarter-than-us machines, which make machines smarter than themselves, and so on, and the whole thing accelerates exponentially toward a massive ultra-intelligence that we can barely fathom. â⬠Such a time will arrive in which humans can upload their consciousness onto the Internet and get assumedââ¬âif not bodily, than at least mentallyââ¬âinto an eternal, imperishable afterlife in the world of electricity (Christian, Mind vs. Machine, The Atlantic, 2011 ). Others imagine the future of computing as a kind of hell, an almost Terminator style apocalypse. Machines black out the sun, level our cities and enable an atmosphere that destroys all living things. There is no doubt that technology has become an integral part of human lives and will only become increasingly so. We have already made the first step into the realm of the posthuman or the cyborg, common examples include the athlete Oscar Pistorious who has prosthetic blades for legs, anyone who has undergone a sex change, or anyone who has modified their bodies with artificial implants for cosmetic reasons. I do not believe there is any going back but I feel technology and humans certainly have the capacity to complement each other and work side by side as we look to the future. It remains to be seen if this synergy will come to pass but there certainly is the capacity for it. And as the human race faces up to some of the toughest questions that have been put to us heretofore I would cautiously back us to prevail To paraphrase Wiener, humans can continue to modify themselves to keep up with the modifications of the environment they find themselves in.
Compromise Of 1877 Frederick Douglass History Essay
Compromise Of 1877 Frederick Douglass History Essay Frederick Douglass was one of the most well-known fiery orators and his famous speeches, including The Meaning of July Fourth for the Negro, were published in many different abolitionist newspapers. On July 5, 1852, Douglass was invited to present a speech about the importance of the Fourth of July for Americas black people. In his speech, Douglass condemned the attitude of the American population toward slavery. In fact, Douglass was very radicalized by the passage of the Fugitive Slave Law in 1850. This law allowed the search and arrest of escaped slaves in areas where slavery had been abolished. In addition, the law obliges the population of all states to actively participate in the capture of fugitive slaves, and the severe punishment for the slaves, those who harbor them, and those who have not contributed to the capture of a slave. That is why, Douglass became radicalized by the passage of the Fugitive Slave Law in 1850 and stated that these events were very cruel in American history. Reconstruction was a period in the U.S. history after the Civil War, from 1865 to 1877 years. In the U.S. history, reconstruction involve, firstly, a historical period following the Civil War between the North and the South, and, secondly, the transformation of the South in the period from about 1865-1866 to 1877 during the restructuring of the government and society in the former Confederacy. Three adopted amendments to the Constitution have affected the whole country. In various southern states, reconstruction began and ended at different times, in the end, the completion of this process is generally considered to be a compromise of 1877. Reconstruction policy was implemented after the fact when the slaveholding South found itself completely at the mercy of the Federal Army. President Abraham Lincoln during the war created the Reconstruction government in several Southern states Tennessee, Arkansas and Louisiana, and gave the land to former slaves in South Carolina. After Lincolns assassination, President Andrew Johnson tried to follow the policies of his predecessor and appointed new governors in the summer of 1865. Soon, he said that the objectives of the war the national unity and the elimination of slavery have been achieved and, therefore, the reconstruction was complete. All in all, it is possible to conclude that despite a lot of abuse and the fact that Reconstruction did not go swimmingly, all the goals were achieved in a proper way and it completed the separation between the North and South. Thus, Reconstruction can be considered to be a success. The movie Glory is based a true story that tells about the 54th Massachusetts Volunteer, which took place during the Civil War. The 54th Regiment was the first unit of the U.S. Army composed entirely of blacks (except for officers). The regiment was formed in 1862 and headed by young Colonel Robert Gould Shaw, who believed that former slaves could also be good soldiers. Colonel Shaw will have to deal with racial prejudice of his enemies and friends, the officers, who began to despise him for his choice. The major differences existed among the black soldiers of the 54th Massachusetts Volunteer Infantry were the fact that the regiment included not only the free blacks, but also the escaped ones who together struggled for their freedom rights. Additionally, they both were from different regions of origin and had different educational backgrounds. However, despite discrimination during the Civil War, blacks could prove that they were good soldiers willing to struggle to the death for their rights. The Emancipation of Proclamation was a document that consisted of two orders of Abraham Lincoln issued during the Civil War. The first decree issued on September 22, 1862, declared free all slaves in any state of the CSA. The second decree issued on January 1, 1863, named the 10 individual states to be covered by the abolition of slavery. At the beginning, the Emancipation of Proclamation was criticized because it emancipated slaves only in the areas where the United States of America had no power. However, the Proclamation brought freedom to thousands of slaves in the day when it entered into force, and in nine of the ten states in which it was applied (Texas was the only exception). In such a case, it is possible to say that the Emancipation of Proclamation was an act of justice, which brought freedom to black slaves and strived to abolish slavery. From the beginning of the Civil War, blacks in the North have made persistent attempts to win the right to serve in the federal army and to defend their freedom. F. Douglas during the Civil War tirelessly explained that the key political issue is the destruction of slavery and insisted on the admission of blacks in the Union Army. However, until the middle of 1862 the government refused them in this. Only under the influence of military setbacks and the growing pressure from the masses, it was decided to call blacks in the Union Army. Before the Civil War, blacks were recruited into the navy, but only in non-combatant positions without the right to bear arms. Thus, nearly two years of war blacks were not allowed to join the army, and only the number of serious injuries has forced Republicans to accept blacks into the Army. Compulsory recruitment of blacks into the army was resolved only by the law of 24 February 1864, that is, in the final year of the war. Blacks fought with unparalleled courage and played a huge role in the victory of the North. Hence, it is possible to draw a conclusion that blacks during the civil war showed many examples of heroism and resourcefulness and had a great impact on the outcome of the Civil War.
Wednesday, October 2, 2019
Howard Dean for President :: Politics Political Essays
Howard Dean for President As more and more polls and data seem to indicate the Howard Dean will be the Democratic nominee for president next year (barring a last minute entry by Hillary Clinton) more and more pundits are pulling out their history books to find comparisons to the front-runner. Most point to Dean as an old-school liberal, in the vain of men such as George McGovern, Lyndon Johnson, and Jimmy Carter. An advocate of increased taxes and bigger government, one can find his photo in the dictionary under ââ¬Å"tax and spend liberalâ⬠. But while Dean is a member of the Old Left, his entrance in the 2004 presidential election bears stronger to the rise of Barry Goldwater than Michael Dukakis. Dean has been catapulted onto the scene through the efforts of the hard left, anti-war, Bush-hating liberal Democrats which turned out for him in an early summer Internet primary, and won it for him. In 1964, conservative Arizona Senator Barry Goldwater was given the Republican nod for president through the intensive efforts of right-wing grassroots groups like the Young Republicans and Young Americans for Freedom. Like Dean, his critics charged that he was ââ¬Å"unelectableâ⬠for his extreme views, and they were proven right when Lyndon Johnson trounced him in the greatest landslide ever. The lesson to be learned from all this is not that the Bush/Rove team can let down their guard in 2004, but that Republicans need to realize, when Dean loses, that it is not the end of the fight. After the 1964 election most pundits declared that extremism was dead, and that all presidential elections would be fought between two moderates. Yet in 1980, Ronald Reagan swept into office on an equally conservative platform. Howââ¬â¢d he do it? By using the grassroots forces left in place by Goldwater while presenting himself as a less acidic candidate who would invigorate a stagnant American dream. In 2008 Hillary Clinton will attempt to repeat the success of Ronald Reagan by using the grassroots left behind by Howard Dean while de-emphasizing her own Bush-hating.
St. Michael :: Essays Papers
St. Michael Michael is first introduced to mankind through the scriptures written in the Bible. In the book of Daniel, Michael is introduced as one of the "chief princes" of Heaven as well as the guardian of the people of Israel (Daniel 10:13). His name is translated to mean "Who is like unto God," and he is one of the seven archangels of Heaven who is mentioned in the Bible, in both the Old and New Testaments. According to Rudolf Steiner, the founder of Anthroposophy and author of the book, The Archangel Michael: His Mission and Ours, Michael was the cosmic being in charge of Intelligence, whereas Michael is associated with light in other circles. This association works itself into a theory that Steiner explains in his book in a chapter titled, Michael, Arthur, and the Grail. In this theory, he proposes that Michael and his hosts of angels that accompany him are all inhabitants of the sun, and that from there, Michael was the ruler of "cosmic intelligence" (Steiner 271), and therefore the provider of all of the thoughts that humans experienced. This intelligence came down upon them from the sun, which he supports with the acceptance that we think with our heads since that is where the intelligence reaches first. And in the time of Alexander and Aristotle when human beings were aware of thoughts - - that is to say, of the content of Intelligence within them -- they did not regard these thoughts as their own, self-made thought: they felt that the thoughts were revealed to them through the power of Michael, although in that pagan era this Michael Being was known by a different name (272). By approximately the 9th century A.D., however, it seemed that human beings were beginning to see their own personal intelligence so that Michael was no longer the bearer of this gift. Now intelligence came from the earth and its inhabitants rather than the sun. But Michael and his hosts have been working to regain his administration of this intelligence by moving "in and through the hearts of human beings (274)." Steiner says that in earlier times than these we live in, people strove for intelligence not by developing their minds, but by seeking out inspirations given to them by cosmic forces, and his example of this is King Arthur.
Tuesday, October 1, 2019
HBS Case: Hedging Currency Risks at AIFS Essay
Instructions: This case should be done individually. You should prepare a written analysis, and hand in two copies of your analysis on April 12 in class. Only hard copies of the case analysis are accepted. I will submit one of the copies to the Deanââ¬â¢s office for assessment purpose. Each student should also bring his/her own copy of the write-up to class, as well as the case itself, so that we can refer to the specifics in our discussion. The text analysis of your case should be about 3-5 pages (double-spaced). You should download the excel spreadsheet for the case at the Blackboard, complete the quantitative analysis using the spreadsheet, and attach the spreadsheet to your case write-up to support your arguments. Your write-up should begin with an opening paragraph that defines the main problem in the case and your recommended solution. The remainder of your paper should support your conclusion and recommendations. This support should be based on your definition of the problem and inferences that you draw from the facts of the case. Structure is important for your argument to be lucid and transparent. The grading will be based on the quality of your analysis and writing. Points will be deducted for grammar mistakes and typos. Your case should address the following questions: 1. What gives rise to the currency exposure at AIFS? 2. What would happen if Archer-Lock and Tabaczynski did not hedge at all? 3. What would happen with a 100% hedge with forwards? A 100% hedge withà options? Use the forecast final sales volume of 25,000 and analyze the possible outcomes relative to the ââ¬Å"zero impactâ⬠scenario described in the case. 4. What happens if sales volumes are lower or higher than expected as outlined at the end of the case? 5. What hedging decision would you advocate? Key Problem The American Institute for Foreign Studies (AIFS) organizes study abroad programs and cultural exchanges for American students. The firmââ¬â¢s revenues are mainly in U.S. dollars, but most of its costs are in euros. AIFS sets guaranteed prices for its exchanges and tours a year in advance, before its final sales figures are known. If the dollar depreciates against the Euro during this period, AIFSââ¬â¢s cost would be higher when measuring in dollars, and negatively impact the firmââ¬â¢s profit. In order to hedge its foreign exchange exposure, AIFS can use an appropriate balance between forward contracts and currency options to achieve the goal. The Case with No Hedging If the exchange rate remains constant at $1.22/euros then AIFS will not incur a foreign exchange loss or a gain. It would cost $1220 per participant at this exchange rate. If the dollar depreciates against euro, the actual dollar costs would be above $1220, and then there would be a negative impact. If actual dollar costs were lower than expected, the impact would be positive. Thus, with a sales volume of 25,000 participants and the exchange rate rises to $1.48/euros then AIFS will be subject to a loss of $4,391,892. If the exchange rate drops to $1.01/euros then AIFS will save $5,198,020.
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