in order to manage risk factors are loss control‚ loss financing‚ and internal risk reduction. By using these three methods and knowing how they work a business can take to protect the company‚ the possible risks are easier to be contained and managed. Loss Control Loss Financing Loss financing is one of these techniques and is a “method used to obtain funds to pay for or offset losses that occur” (Risk Management Methods). Loss financing covers four different areas that help to achieve its end
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Risk Financing Risk imposes costs in two broad forms – loss costs and the costs of uncertainty. Risk financing attempts to mitigate the impact of these costs by structuring the availability of funds to pay claims‚ aid recovery and enable the organization to maintain financial stability as it moves forward towards its mission. How risk financing occurs can vary. At one end of the scale‚ fully self-insured entities retain responsibility and‚ if risk-related costs arise‚ the entity directly bears those
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Explain of how the Linked Exchange Rate System works in Hong Kong. A Linked Exchange Rate systems function is to keep a currency stabile to another. In this manner‚ the HK Dollar has been linked to US Dollar at the rate of 7.8 HKD to 1 USD‚ since 1983. In order to maintain this exchange rate‚ any change in the monetary base is fully backed by a corresponding change in the respective currency at this exchange rate. Most banknotes in HK are issued by three note-issuing banks. So for example
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is a fixed exchange rate system that fixes the exchange rate of Hong Kong Dollar and United State Dollar to a ratio of 7.8: 1 Hong Kong Monetary Authority does not need to stable exchange market by controlling the supply and demand of HKD. It can be stabilized by Fixed-linkage System. In the past 15 years‚ Hong Kong interest rates and exchange rates fluctuated in the same trend of the US interest rate and exchange rate. The graphs below show an example of interest rate and exchange rate respectively:
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2012–2013 Global Undergraduate Exchange Program Global UGRAD Program Description: The Office of Academic Exchange Programs in the Bureau of Educational and Cultural Affairs of the U. S. Department of State‚ is pleased to announce a new exchange program for undergraduate students-the 2011 Global Undergraduate Exchange Program (Global UGRAD) The Global UGRAD Program provides scholarships for one semester or one academic year of U.S. Study in a NON-DEGREE Program. The goals of the program are
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Developing a successful business model without strong control mechanisms will only generate temporary profits. The purpose of control mechanisms in business models is to protect the created values and profit streams from being reduced by competitors‚ partners or strong customers. The last decades have shown a rapid growth in customer power at the same time as new technology and services are being replaced faster. Even though control always has been an important part of the business model
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services to the customer. Fund based services of NBFCs include: leasing‚ hire-purchase and other asset based services whereas fee based services of NBFCs include bill discounting‚ portfolio management and other advisory services. LEASE FINANCING Leasing as financial service is a contractual agreement where the owner (lessor) of equipment transfers the right to use the equipment to the user (lessee) for an‚ agreed period of time in return for a rental. At the end of the lease period the
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Debt and equity are essentially the ways in which companies can raise capital. Debt financing is when a company takes out a loan that generally has a defined time period and interest rate attached to the transaction. Debt financing include loans‚ leases‚ bank overdrafts and terms of trade. Next‚ equity financing is when a company issues shares to the other investors which can be the general public or investment companies. These shares represent ownership of the company to the extent of the shares
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high residual value of cars and the second hand car market‚ which enables other forms of financing beyond pure unsecured loans. Car finance arose because the price of cars was out of the reach of individual purchasers without borrowing the money. The funding for personal car finance is provided either by a retail bank or a specialist car financing company. Some car manufacturers own their own car financing arms‚ such as Ford with the Ford Motor Credit Company and General Motors with its GMAC Financial
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True / False Questions 1. Accounting is a system that collects and processes financial information about an organization and reports that information to decision makers. TRUE AACSB Tag: Communications Difficulty: Easy L.O.: 1 2. Assets on the balance sheet are recorded at market value or replacement cost. FALSE AACSB Tag: Reflective Thinking Difficulty: Easy L.O.: 1 3. In accounting and reporting for a business entity‚ the accounting and reporting for the
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