Why Soft Drink Industry Is Profitable Essay Example for Free

Why Soft Drink Industry Is Profitable Essay 1. Why was the soft drink industry so profitable? Soft drink industry observed growth rate from its inception 1886 to 1990, the consumption of soft drinks saw remarkable growth, below data shows the growth in United State’s consumption. Year| 1899| 1970| 1980| 1990| Consumption| 0. 6| 22. 7| 34. 5| 47. 4| #Consumption: Gallons per person per year Financial figures also back the growth story of the Soft Drink market. ROE %| 1972| 1975| 1980| 1981| 1982| 1983| 1984| 1985| 1986| 1987| 1988| 1989| 1990| Coke| 22| 21| 20| 21| 18| 19| 23| 24| 27| 29| 31| 49| 36| Pepsi| 16| 18| 20| 20| 14| 17| 12| 30| 22| 24| 24| 23| 22|. ROE is even higher across years and it increased to 36% for Coke and 22% for Pepsi in 1990 from 22% and 16% in 1972 respectively. The main reason for being profitable is that the United States market took the soft drinks overwhelmingly and gradually it became a part of their life style also the manufacturing process for concentrate was simple and required small investment, significant cost were to advertise, promotion, market research etc, while bottling process was extremely capital-intensive and involved specialized, high speed lines, but there was no considerable investments required on Advertisements, promotions and market research etc. This way Concentrate Manufacturers and Bottlers complemented each other for higher profit margins by sharing cost on in procurement, production, marketing and distribution. Many of their functions overlap; for instance, Concentrate Manufacturers do some bottling, and bottlers conduct many promotional activities. Balance Sheet data for year 1986 shows that pretax profit as % of assets was $. 40 per case for Concentrate Producers and $. 37 for Bottlers. The Cola war between Coke and Pepsi played significant role to increase the consumer base as both came up with new strategies and ideas to grab the market share from others that resulted to new markets and new consumers.

Personal Narrative - One of My Most Coveted Achievements :: Personal Narrative, Autobiographical Essay

One of My Most Coveted Achievements    Dr. Ross’ Comments: This essay is a very good example of a personal experience shared by the writer. She clearly describes an important episode in her life and vividly reveals a part of her true â€Å"self† to her audience.    What began in my life as yet another effort in weight loss became one of my most coveted achievements. After the birth of our third child, and too many pounds that were not disappearing, we purchased a small above ground pool. While the kids splashed, I began my aquatic exercise program. Within a short time, I yearned to swim laps in a larger pool, and soon we were swimming at Southeastern Louisiana University’s near Olympic size facility. Setting my sights on becoming a long distance swimmer, I had indeed begun to lose weight as my fitness improved. I discovered a real satisfaction from swimming. As I learned to improve my stroke and lung capacity, I savored the quiet world that I was immersed in during my workouts. It became my special time to allow my thoughts to glide as effortlessly as my body did while my distance increased to an uninterrupted mile. I truly loved the permanent smell of chlorine on my skin. I was a swimmer. The coach of the adult swim team invited me to join, and I was delighted to be considered an athlete of any kind. Morning workouts with the team were now interspersed with my evenings at the pool with my children, as I prepared to enter the world of competition. Shortly before one meet, our coach had recruited several twenty year old, physically fit men to join our team. Having now competed a few times, I was no longer a novice, but still not a veteran. I fully expected this to be like most of my team practices, faster than the slowest, but not able to keep up with the more skillful swimmers. The pool was unusually empty for the day before a competition as some chose that time to rest and restore in order to be in peak condition for the event. I only recall the coach, these new swimmers and myself in the water. As the coach called out the directions for each lap, his voice bounced off the walls that shimmered with the under water lights that seemed to move as the water ripples above.

Addictions and Phobias Through Classical and Opperant Conditioning Essay

Phobias and Addictions through Classical and Operant Conditioning This paper will explore how phobias and addictions are formed through both classical and operant conditioning and show just as addictions and phobias can be formed, they can also become extinct. Classical conditioning is the use of a conditional stimulus such as a person, place or object that forms an unconditional response. An unconditional response is one that does not require thought, but instead, is a natural reaction of the body (Kowalski & Weston, 2010). Irrational fear of an object or a situation is called a phobia. Phobia’s can make a person become paralyzed with fear for no apparent reason. Phobia’s can be created by putting together an object or a situation with an irrational thought or feeling. Singularly, the object or situation does not provoke a fearful reaction, put once a fearful, irrational thought is associated with the stimulus, the object or the situation creates a fearful response. Phobia’s can be created by classical conditioning. This happe ns when a stimulus is repeatedly paired with a negative reaction. Over time, the brain begins to associate the stimulus with the negative reaction and creates a fight or flight response. Take for example agoraphobia, the fear of being in certain places such as crowds, public transportation or being outside their home without another person. At some point, while doing one of these activities, the individual probably had a panic attack. In his or hers mind, the association between the place and the panic attack has started to take hold. The next time the individual returns to the place or activity, he or she may become worried that he or she will again have a panic attack. The stress from the worry may then elicit another panic attack, which then conditions the brain to have the same fearful reaction to the stimulus. The individual then becomes extremely stressed when faced with the stimulus, or he or she avoids the place or activity completely. This is how agoraphobia is created through classical conditioning. Operant conditioning is a reinforcement of behavior that is controlled by the environment rather than then being a natural  reaction of the body (Kowalski & W eston, 2010). When an individual avoids a situation or an activity because of even the slightest fear, this reinforces the effects and the intensity of the fear. It can become a phobia through operant conditioning. A phobia created by operant conditioning takes place when the negative reaction to the stimulus is reinforced by the avoidance of that stimulus. Over time, the negativity escalates and the individual will have a much harder time dealing with and overcoming his or her fear. While classical and operant conditioning can create phobias, they can also cause addictions. According to the book â€Å"Addictions: A Comprehensive Guidebook† (McCrady & Epstein, 1999) classically conditioned addictions are created when the mind begins to associate a person place or object to the stimulus of the addiction such as shopping, drugs or food. These associations then begin to have a trigger effect and that causes the cravings or urges for the stimulus. With operant conditioning, a person is conditioned to use his or her stimulus of choice because of the feelings or emotions that are aroused due to the use of the individual’s stimulus. These feelings are a positive reinforcement of his or hers behavior directly related to the use of that person’s â€Å"drug† of choice. In the case of an individual who is addicted to food, if he or she is feeling upset or anxious, they may choose to binge on food and in the moment, start to feel less anxious or less irritable. These feelings are a positive reinforcement of their choice to binge. Thus they are conditioning themselves to feel better through the use of food bingeing. This is operant conditioning. Just as classical and operant behaviors are able to take hold, they can also become extinct. In the case of phobia’s or addiction’s, the classical conditioning extinction process starts to take place when the body’s natural reaction, i.e. panic attacks or cravings, start to take place without the person, place or object being posed. Eventually the mind starts to disassociate the original stimulus and the response, leading to the extinction of the classically conditioned behavior. Much in the same way as classical conditioning becomes extinct; operant conditioning begins the extinction process when the reinforcement of the behavior no longer takes place. For the binge eater, if they no longer are comforted by the food, the food starts to become less effectual as a means to control feelings  bringing about the extinction of the addiction (Kowalski & Weston, 2010). Simply put, phobia’s and addictions can be learned and reinforced by way of conditioning and also can be extinguished by lack of the same conditioning. Bibliography Kowalski, R., & Weston, D. (2010). Learning. In R. Kowalski, & D. Weston, Psychology 6th Edition (pp. 162-194). Hoboken: R.R. Donnelley & Sons, Inc. McCrady, B. S., & Epstein, E. E. (1999). Etiology of Alchohol and Other Drugs. In B. S. McCrady, & E. E. Epstein, Addictions: A Comprehensive Guidebook (p. 61). Oxford: Oxford University Press.

The Beloved Catherine of Aragon - 1358 Words

History remembers King Henry VIII and his many wives. Very few remember his first wife, Catherine of Aragon. She was known as being quite beautiful and a great queen. Despite how poorly treated she was Catherine remained strong. The beloved Catherine of Aragon was the most remarkable queen due to the way she led her kingdom. Catherine, First Queen of King Henry VIII, daughter of King Ferdinand and Queen Isabella of Spain, was born at Alcala de Henares on the 15 or 16 of December 1485. She is the youngest in her family of five, which includes one son and four daughters. She was also the youngest of the surviving children of King Ferdinand and Queen Isabella. When her mother was pregnant with Catherine she would travel in hot spring and scorching summers to be with the army, and unfortunately Queen Isabella lost many children because of the conditions that she traveled in. Catherine was seven when her parents defeated the Moors. Catherine grew up during the Spanish inquisition, which explained why her mother went wherever the army went. Catherine was also the youngest daughter of one of Europe’s most famous power couple. Since her parents were a power couple it made the children to be desired and married too. Queen Isabella and King Ferdinand marriage had united Spain under one rule. Catherine did have an older brother who was going to be the heir to the throne, and due to a tragic accident Juan died at the young age of 19. In response to his son’s death, Ferdinand becameShow MoreRelatedKing Henry The Viii By William Shakespeare853 Words   |  4 PagesArthur and his bride Catherine of Argon’s wedding. Four months after the marriage began, it ended, with Arthur s death. There was a signed treaty that stated Catherine would be allow to marry the next heir to the throne – Prince Henry. It was considered necessary for a papal exemption to be issued permitting Henry to wed Catherine because she was his dead brother’s wife, and this marriage was restricted in Leviticus. At the time, and for the duration of her life, Catherine denied that her marriageRead MoreHenry VIII: King of England1349 Words   |  6 Pageswife, Catherine of Aragon. However, Henry VII refused to allow Henry to marry Catherine until her parents, Ferdinand of Aragon and Isabella of Castile, paid the dowry they owed him. Fortunately for Henry, his father died unexpectedly and he was therefore free to make his own choices. Catherine was only able to produce one child in which it was a girl named Mary. Henry had fallen in love with another woman named Anne Boleyn, and he then tried convincing the Pope to annul his marriage to Catherine. UnfortunatelyRead MoreKing Henry Viii2987 Words   |  12 Pageswas Catherine of Aragon who was later to be Henry VIII first wife. Shortly after the marriage, Arthur died on April 2, 1502 from night-sweats. This left Henry the rightful heir to the English throne right before his 11th birthday. Fourteen months after Arthur’s death, Catherine of Aragon was betrothal to Henry VIII, and then he was too young to marry. As Henry VIII grew up his father became less willing to have an alliance with the Spanish and he repudiated the betrothal of Henry and Catherine. AfterRead MoreKing Henry Viii s Reign1986 Words   |  8 Pagess exual desires because he was bored of the 18 year relationship with his wife, Catherine of Aragon, who was six years older than he was. Catherine, 41 years old, was quickly exiting the child bearing years of her life, and this was unattractive and unacceptable to Henry. Catherine had not yet given Henry the male heir he craved so much. All Catherine had given, and would give, Henry was a daughter named Mary. Catherine suffered miscarriage after miscarriage and of the babies that were born after MaryRead MoreComparing Catherine II and Elizabeth I1900 Words   |  8 PagesThe above quote applies very well to both Catherine II and Elizabeth I. Neither lady sought the power of their lands; they were given it in a unusual circumstance. They then display great leadership and do great things for each country. Catherine II, Empress of Russia, was born in Germany in 1729, but with the name of Sophia. She was the daughter of Prince Christian August and Princess Johanna Elizabeth. Since she w as a princess, she was home schooled. She became very smart and free spirited. NancyRead MoreThe Break With Rome By William Shakespeare4767 Words   |  20 Pagesenough motives behind it to lead on to such a bigger event. The main causes that have been debated over for century’s are: the inability of Catherine of Aragon to provide a male Heir for King Henry that he so desperately desired to have, the love obsession with Anne Boleyn that historians believe subsequently led on to Henry wanting to annul his marriage with Catherine with means such as a Leviticus testament from the bible, Pope Clement VII’s refusal to grant the annulment for Henry and the fact thatRead MoreQueen Elizabeth Of England s Greatest Rulers1739 Words   |  7 Pagespeace from religious persecution, Elizabeth managed world affairs with intelligence and quick wit. Spain was the most powerful army and navy in the world. Anglo-Spanish relations were not good, because Elizabeth’s father divorc ed the Spanish Catherine of Aragon. And because England was not a Catholic country. Philip II, who wanted more power, hoped to marry Elizabeth to add to his relham of power. The Dutch rebelled from Spanish rule in 1566, and in 1572 Elizabeth helped finance their fight. She alsoRead MoreKing Henry VIII and The Reformation2328 Words   |  9 Pageshis lifetime. The tale of his divorces produces quite the influence on England’s society today. King Henry married his first wife, Catherine of Aragon, the previous wife of Prince Arthur. While betrothed to King Henry, Catherine birthed six or more children. One daughter was stillborn, and two sons were born healthy but sadly died a few months later. Finally, one beloved child lived—a daughter named Mary. While most parents are overjoyed with the living birth of their child, King Henry wasn’t satisfiedRead MoreMonarchy Vs. Constitutional Monarchy3315 Words   |  14 Pagesoverestimate. Books about the Tsar Reformer con tinue to be written to this day, and we will hardly be able to describe here all of his many accomplishments and achievements. Peter the Great (whom the Russians generally call Peter I - Pyotr Pervy) is beloved in Russia, and all the more so in St. Petersburg, where he is rightfully lauded as the Founder of the City, and honored with numerous memorials. Peter the Great was the youngest son of Alexey I and his second wife, Natalya Naryshkina. Alexey was succeededRead MoreBrief Biography of Mary, Queen of Scotts2671 Words   |  11 Pagesinvolved in the chaos of civil war because of her management over it. In the midst of the war between her and the Catholics against the Protestants, she succumbed to the cruelty of the war and died in 1560. With her death Mary lost three of her most beloved people within a short period of six months. (Mary Queen of Scots) In 1561, the year following the death of her husband and mother, Mary decided to return to Scotland, though her friends warned her against it. In the time that she had been away

Different Theories Concepts Of International Trade Theories

In this paper, the author will examine, and categorizes the differences between different theory concepts of international trade theories. The author will analysis and seriously assess their believe concepts and believe. The author of this assignment agrees with the economist that international trade is the interdependence of nations in terms of trade. International trade theories are basically different theories, with their concept of trade how they explain international trade. The concept of majority of economist believes that, trade is about exchanging goods and services between two people or countries within the world. People do trade because they believe that, from the exchange of goods and service, both can benefit from each other as resources. They need the goods and services which they are exchanged. Though at the surface, this may sound very simple, there is a great deal of theory, policy, and business strategy that constitutes international trade. The author will talk about the different trade theories that have developed over the past century and which are mine. Most applicable in today s business world. In addition, the author will explore the issues which impact international trade and how businesses and governments use these issues to their respective benefits to promote their. According to Blecker (1997) Absolute Advantage Adam Smith a Scottish an economist, known as the father of free trade and he was recognized as the founder of modern economics and asShow MoreRelatedInternational Trade Theories, Trade, Cultural Diffusion, And Economic Trade Theory1374 Words   |  6 Pagesand base concept of international trade theories. The author will examine and critically assess the concept of international trade. This paper agrees with the economist that international trade is the interdependence of nations in terms of trade, cultural diffusion, and economic interdependency. International business trade theories are basically different theories with their concept of trade how they explain international trade. The concept of majority of economist believe that, trade is about exchangingRead MoreMajor Trade Theories888 Words   |  4 PagesTrade theories Introduction The concept of absolute advantage is one of the most fundamental areas of concern in the study of economics. In its basic meaning, absolute advantage refers to the ability of one individual or party to produce more of a particular good or service than other competitors given the same amount of resources. In this regard, absolute advantage becomes a very important aspect in the concept of international trade as it clearly defines the different areas where countries shouldRead MoreDavid Ricardos The Principle Of Political Economy And Taxation1519 Words   |  7 Pagesmodern economics was David Ricardo who developed the concept of the comparative advantage of trade. This concept is a part of the classical theory of trade and was published in 1817 in David Ricardo’s book entitled the Principles of Political Economy and Taxation (Appleyard Field, 2014, p. 30). This paper will address the effectiveness of this concept as it has been applied to real-world international trade afte r the General Agreement in Trade and Tariffs (GATT) was signed in 1947. How the levelRead MoreRealism, Liberalism, And Marxism1024 Words   |  5 PagesRealism, liberalism, and Marxism are all different perspectives that can be used to analyze situations and aid government officials to understandings and agreements in relation to trade. Lawrence Herman s article focusses on the potential destruction of the North American Free Trade Agreement (NAFTA) caused by the disturbing and unacceptable proposals by the United States president, Donald Trump. There are many different views on Free trade but three main perspectives are the realist views, whichRead MoreEssay on International Trade Simulation987 Words   |  4 Pagessummarize the International Trade Simulation, explain the basic concept of International Trade, emphasize the four key points from the reading assignments in the simulation, and apply these concepts to my workplace. Simulation Summary In the International Trade simulation, you are the Trade Representative of a small country called Rodamia. You are introduced to international trade--the theory of comparative advantage and the impact of tariffs, quotas, and dumping on international trade (Applying InternationalRead MoreTrade Is The Exchange Of Good And Services Between Two Countries1458 Words   |  6 PagesTrade is the exchange of good and services between two countries. When circumstances of the countries are right, trade can bring out the benefits to all of the countries involved. It is also a powerful driver for sustainable growth and rising living standards. International trade has the potential of benefiting participating countries through specialisation, lower prices and greater competition of local producers. Many countries have seen a growing share of their GDP directly linked to overseas tradeRead MoreRelationship Between International Trade And Marketing914 Words   |  4 Pagesgeneral overview of the r elationship between international trade and marketing. It will first present a historical background about import and exports, the trade agreements and their impact. Perhaps before, marketing wasn’t considered an important branch of trade but how important is marketing for the new companies that want to go global and enter on international trade? The paper will study the different elements of marketing that comes to life in the trade process and how important it really is forRead MoreThe Theory Of International Relations1535 Words   |  7 PagesWhen studying International Relations, there are various theories involved, three of these theories being: realism, liberalism, and constructivism. A theory is fundamentally ideas and complex concepts that have their own way of understanding something. These theories are used in evaluating world politics, by coming up with a unique way of identifying and explaining the events that occur around the world (Mingst 5). The theories help explain different perspectives on how the world system functions;Read MoreIssues in Global Business1296 Words   |  6 PagesModule Title Issues in Global Business and Strategic Concepts       Module Code 6IM 501      Module Level 6 Credit value 40      Total Number 400 of Learning Hours Key Words Implementation of Global strategy, strategy and the organisation, strategic development, globalisation, international business and the environment, internationalisation.      Module Description There has been a fundamental shiftRead MoreWorld Trade Essay example1308 Words   |  6 PagesTraditional and most developed form of international relationships is world trade. World trade is around 80 percent of all international economical relationships. International trade is a form of communications between manufactures of different countries that comes out as a result of world labor division, and express mutual economic dependence. Wild, in his book gives us a definition of world trade as: The purchase, sale, or exchange of goods and services across national borders induced by sellers

Do We Really Use 10% of the Brain - 601 Words

The fact that humans only use ten percent of the brain isn’t a fact at all, but a myth. A myth created through misinformation and misinterpretation. There are pros to the myth however, and theories have been created because of its influence. Either way, humans use 100 percent of their brain throughout their daily life. What is the ten percent myth exactly? The myth has no discernable source but has been referenced throughout history to explain gaps in scientific research or as a way to make a quick buck. The myth may have originated from the writings of William James, a psychologist and philosopher who wrote, â€Å"We are making use of only a small part of our possible mental and physical resources.† in his psychology book, The Energies of Man. That quote was possibly converted into the ten percent myth of today. It is also said that Albert Einstein referenced the myth in relation to his own intelligence though there are no records to support this claim. It doesn’t help that the media is keeping the myth alive through articles and TV. There’s even a movie about how a girl unlocked the supposed hidden 90 percent of her brain and gained superpowers! Uri Gellar, a so-called psychic, used the myth to explain his hypothetical abilities. The myth also lives on through its many variations. One version is that a scientist years in the past claimed that we do only use ten percent of our brain. Another version is that back in the day only ten percent of the brain had been mappedShow MoreRelatedIs Text Mining Different Than Data Mining?1541 Words   |  7 Pages 2. (10 pts) How is text mining different than data mining? Text mining is a process which collects information and knowledge from large amounts of unstructured data sources. When I say unstructured data sources, I am talking about Pdf files, Word documents, XML files, text excerpts etc†¦ Text mining collects information from text. Text mining is different than data mining because data mining is a process which collects information and knowledge from large amounts of structured data sources. StructuredRead MoreSpeech1062 Words   |  5 Pagesthis dream about half of its content is forgotten and in 10 minutes 90% of it is gone. According to the New York time study done on October 20, 2013 by Gary Matter you spend about 6 years of your life dreaming. That’s more then 2100 days spent in a different realm. So today, lets look at how dreams really do occur, the part of your sleep cycle that dreams occur in and lastly different types of dreams. Transition: So where do dreams really start? Body I. REM Sleep A. Rapid eye movementRead MoreHow You Can Learn The Secrets Of Mind Power923 Words   |  4 Pagespowerful mind, but most us just do not believe it. It has been proven through research that humans use only 10% of the mind power of their brain. That is crazy. That means that we only focus on the simple things. That is why we all feel that we are having so much trouble in life. We think negatively because we do not believe that what we want can happen. So we basically continue to attract nothing more than negativity. The truth of it is that the things that we think are really happening right before ourRead MoreEssay about Cognitive Learning and Right Brain vs. Left Brain 950 Words   |  4 Pageslearn within their environment. In my opinion, children are the prime example of the unbound potential that humans to learn. I will be discussing what cognitive learning is and how it contributes to learning and if right versus left-brain dominance impacts how we use our cognitive skills. What is cognitive learning and why is it vital to humans? Cognitive is defined by unabridged dictionary as the â€Å"mental processes of perception, memory, judgment, and reasoning, as contrasted with emotional andRead MoreThe Effects of Social Media on Human Brain and Behavior1386 Words   |  6 PagesThe Effects of Social Media on Human Brain and Behavior The influence of rapidly growing social media, television, and the internet has taken the world by storm in recent years. Its fascinating development over the years is nothing short of remarkable when you take into account that 20 years ago, only 16 million people in the world were online, compared to the 2 billion that roam on the internet now. Modern communications technology has now become so familiar and utterly banal, yet there isRead MoreDualism By Rene Descartes1205 Words   |  5 PagesKamakana Ching 10-15-17 Phy 263 3:00pm Dualism Renà © Descartes. Who is he? The man, the myth, the legend, the one and only. The man behind dualism that got everything rolling. He was born March 31, 1596, Indre-et-Loire, France and died February 11, 1650, Stockholm, Sweden. Though his time of life he was famous and we’ll know for being a great mathematician, scientist and the father of modern western philosophy. So what really is dualismRead MoreThe Autism Spectrum Disorder ( Adhd )816 Words   |  4 Pagesâ€Å"Dear teacher, I know it may not seem like it, but I really do want to listen and learn. It’s just my brain is kind of different.† Quoted from students in the video, â€Å"Dear Teacher: Heartfelt Advice for Teachers from Students† (Highways, 2015). A link is in the reference page below. This video is filled with many children who differ on the Autism Spectrum Disorder (ASD), who have Attention Deficit Hyperactivity Disorder (ADHD), learning disabilities, Sensory Processing Disorder, or Central AuditoryRead MoreSimple Steps to Keeping Your Mind Sharp600 Words   |  3 Pagesfamiliar name during a conversation or can’t remember what you should be getting in the closet. Getting old is not really a significant factor in memory loss; for some it may be due to organic disorders, neurological problems, or brain injury. The brain is surprisingly adept when it com es to improving memory and making it intact even as we grow older. It’s up to us to do everything we can in keeping ourselves mentally sharp and preserve it in the long run. Studies have shown that there are many waysRead MoreAre Cell Phones Truly Safe? Essay1154 Words   |  5 Pages From the 1940’s to 2011, cell phones have come a long way, from its capability to help individuals to keep in touch with friends and loved ones from near and far. Now and days we use them to text, im (instant message) a person, browse the internet, take pictures, email, and even transfer data. It’s amazing how far we have gotten with a device as such, fulfilling majority of our everyday needs. But can it also be putting user’s lives in a high risk of danger? There have been many issues linkingRead MoreIs Bad Parenting Cause Mental Illness?973 Words   |  4 Pages I really struggled with this question, I had to approach it from many different angels. First to answer the question can bad parenting cause mental illness like schizophrenia I would say yes. Hers why; first off substance abuse can cause brain abnormalities which is linked to schizophrenia. When women become pregnant were told numerous of times the affects alcohol, drugs, and cigarettes can have on the fetus. So I feel any affects that a child has from a mother being careless while being pregnant

Duport Analysis the Number Game free essay sample

From these equations, the higher the ratios meant the better of the company’s financial condition, or more liquidity. The acceptable ratios vary from different industries. In general, company’s quick ratio should be 1 or higher, and its current ratio should be above 1. 5 to be considered liquid. In the comparison between two companies’ ratios, DCM Molding has shown a better financial condition on average in the past four years, and Plastichem has barely met the acceptable average or is below the average in the past four years. Quick Ratio = (Cash and marketable securities + A/R + Other Current Asset)/ Current Liabilities | Year| 2004| 2003| 2002| 2001| Plastichem| 0. 86| 1. 141| 1. 039| 0. 826| DCM Molding| 0. 99| 0. 93| 1. 114| 1. 568| | Year| | 2004| 2003| 2002| 2001| Plastichem| 1. 301| 1. 523| 1. 462| 1. 309| DCM Molding| 1. 632| 1. 518| 1. 826| 2. 095| | Year| | 2004| 2003| 2002| 2001| Plastichem| 0. 763| 1. 9113| 1. 962| 2. 442| DCM Molding| 4. 667| 1. 217| 4. 217| 8. 6| To measure the leverage, we calculated the debt-equity ratio. Plastichem had a relatively high Debt-Equity Ratio, which indicated that Plastichem was using many debts to finance its growth. High Debt-Equity Ratio also indicated that Plastichem bore more risk because the cost of debt (interest). We will write a custom essay sample on Duport Analysis: the Number Game or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The company would make more profit if the incremental profit exceeds the incremental cost of debt; however, the company may lose more money/ make less money if the incremental profit is less than the incremental cost of debt. | Year| | 2004| 2003| 2002| 2001| Plastichem| -19. 331| 5. 076| 4. 862| 1. 355| DCM Molding| 1. 192| 1. 477| 1. 274| 0. 714| To determine the profitability, we calculate the Profit Margin, ROE, and ROA. By looking at the ratios, Plastichem’s profit has dropped in the past four years. For DCM, on the other hand, we see that it has been fairly constant as well as ROE components. Some of the limitations regarding the various financial analyses above are: Many companies near the year or quarter end improve the appearance of their figures presenting them in the most attractive way possible. The miss misrepresentation of numbers makes the analysis more difficult. The analysis may also be unclear by inflation as general price levels for goods and services go up and subsequently purchasing power goes down, which makes comparison difficult over time. Many firms also use different accounting methods which make comparing of different companies difficult for instance there are two primary accounting methods used in USA, cash and accrual accounting. Cash accounting reports income and expenses are reported in the year they are received and paid; accrual accounting reports income and expenses in the year they are earned and incurred. Again making it very difficult to analyze different companies. Some additional data Jay and Jack need in order to improve their finding would be to look into the companies accounting practices and see if any off balance sheet items are present. From there they need to make sure the off balance sheet items are converted to in the balance sheet items to have an appropriate comparison. A statement of cash flows would also useful in analysis, as it would allow in determining the short-term viability of a company, particularly its ability to pay bills. A statement of cash of cash flows also allows us to view cash and cash equivalents coming in and out of company, giving better understanding as to where money is going and coming from. Also although looking at numbers may allow analysis to quickly spot differences in financials, I believe you must research companies in how they are run and if they are consistently making good business decisions. After collecting, compiling, and analyzing data we have come to conclusion that DCM Molding has shown a better financial condition on average in the past four years, and Plastichem has barely met the acceptable average or is below the average in the past four years. The Plastichem had a relatively high Debt-Equity Ratio, which indicated that was using many debts to finance its growth. The high Debt-Equity Ratio also indicated that Plastichem bore more risk because the cost of debt (interest) making things difficult. The cost of the sales for both the companies have increased. But, the cost of goods sold for DCM is less that than Plastichem. This indicates that DCM has been better at controlling their cost so they have a higher gross margin as compare to Plastichem. This reduction in the gross profit has lead to the reduction on the expenses occur due to selling the goods, but since DCM has a higher gross profit than Plastichem they can also spend more in selling their goods. So in comparison we see that DCM Molding is doing far better with its figures showing much better results than Plastichem. Recommendation that Jack would be justified in making in his report to Andrew would be Plastichem needs to increase profit margin after looking at the figures we find that the decrease in return on equity for Plastichem is mostly due to the drop in net profit margin. Plastichem increased their use of debt that resulted in a higher equity multiplier, but poor profit margin ensured the fall of return on equity. Plastichem had a relatively high Debt-Equity Ratio, which indicated that Plastichem was using many debts to finance its growth. It should be treated as a serious problem being that Plastichem’s main rival is rated as a strong buy while their stock is rated as a hold. The strong drop in price will create fear for potential and current shareholders. If that fear continues, Plastichem’s shareholders might sell their stock at a decreasing rate, causing more issues for the company. The CFO should do a comparison between Plastichem and DCM’s numbers, and find the strengths and weaknesses amongst his company, in particular within its management teams. He should also begin finding ways to pay off Plastichem’s debt as well as not accumulating anymore, being that Plastichem is already seen as risky. The CFO should also find a tighter way to control the company’s costs. The analysts are very accurate in their recommendations to the two firms. DCM Molding figures showed far better results and stock should rise; While Plastichem might consider selling stocks, if financial performance continues to worsen.