Difference Between Commercial Bank and Islamic Bank Essay Example

Difference Between Commercial Bank and Islamic Bank Paper Product Differentiation between Islamic Banking and Conventional Banking Submitted to: Quazi Sagota Samina Senior Lecturer, Department of Business Administration. East West University, Dhaka. Submitted by: NameID Arafat Rauf2009-2-10-345 FIN 380 Section: 2 Group: 10 Fall: 2011 Date of Submission: 23rd October 2011 Table of Content Executive Summary3 Objective of the Study3 Limitation of the Study3 Analysis4 Bibliography12 Executive Summary Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia’h) principles and guided by Islamic economics. In particular, Islamic law prohibits usury, the collection and payment of interest, also commonly called riba. Generally, Islamic law also prohibits trading in financial risk (which is seen as a form of gambling). In addition, Islamic law prohibits investing in businesses that are considered unlawful, or haraam. Islamic finance has been gaining momentum on a global scale for the last 30 years. Conventional banking is based on collateral. In conventional banks charging interest does not stop unless specific exception is made to a particular defaulted loan. Interest charged on a loan can be multiple of the principal, depending on the length of the loan period. More than half the population of the world is deprived of the financial services of the conventional banks. Objective of the Study Our objective of the study was to know the product differentiation of Islamic Bank and Conventional bank. In which way they differ from each other. In our case, we have use Shajalal Islamic Bank as an Islamic bank and Uttara Bank as a Conventional bank. We mainly focus on to know the difference of Islamic bank and conventional bank. Limitation of the Study We will write a custom essay sample on Difference Between Commercial Bank and Islamic Bank specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Difference Between Commercial Bank and Islamic Bank specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Difference Between Commercial Bank and Islamic Bank specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Although we have tried our best to make this term paper perfect but there were some limitations that obstructed us from doing so. We have faced some problems while preparing this report. Some of the limitations encountered while making this report are as follows: The topic has so much to cover, so initially we faced some problem to choose the appropriate field to talk about. We tried to collect information about Uttara Bank, but as not much information is available we faced some problem to make comparison with Shajalal Islamic Bank. Analysis of the study ISLAMIC BANKING Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia’h) principles and guided by Islamic economics. In particular, Islamic law prohibits usury, the collection and payment of interest, also commonly called riba. Generally, Islamic law also prohibits trading in financial risk (which is seen as a form of gambling). In addition, Islamic law prohibits investing in businesses that are considered unlawful, or haraam. Amongst the governing principles of an Islamic bank are: * The absence of interest-based (riba) transactions; The avoidance of economic activities involving oppression (zulm) * The avoidance of economic activities involving speculation (gharar); * The introduction of an Islamic tax, zakat; * The discouragement of the production of goods and services which contradict the Islamic value (haram) Islamic law considers a loan to be given or taken, free of charge, to meet any contingency. Thus in Islamic Banking, the cred itor should not take advantage of the borrower. When money is lent out on the basis of interest, more often it leads to some kind of injustice. (Website of sooperarticles. om) Conventional Banking Conventional banking is based on the principle that the more you have, the more you can get. In other words, if you have little or nothing, you get nothing. As a result, more than half the population of the world is deprived of the financial services of the conventional banks. Conventional banking is based on collateral. Conventional banks look at what has already been acquired by a person Conventional banks go into ‘punishment’ mode when a borrower is taking more time in repaying the loan than it was agreed upon. They call these borrowers â€Å"defaulters†. When a client gets into difficulty, conventional banks get worried about their money, and make all efforts to recover the money, including taking over the collateral. In conventional banks charging interest does not stop unless specific exception is made to a particular defaulted loan. Interest charged on a loan can be multiple of the principal, depending on the length of the loan period. (Website of scribd. com) Uttara bank (UBL) UBL is one of the largest private banks in Bangladesh. It operates through 211 fully computerized branches ensuring best possible and fastest services to its valued clients. The bank has more than 600 foreign correspondents worldwide. Total numbers of employees are nearly 3,562. The Board of Directors consists of 13 members. The bank is headed by the Managing Director who is the Chief Executive Officer. The Head Office is located at Bank’s own 18-storied building at Motijheel, the commercial center of the capital, Dhaka. Special loan scheme Consumer credit Uttaran Consumer-Credit Scheme : ________________________________________ UBL started Uttaran Consumers Credit Scheme from 1996. UBL offers opportunity of Financial assistance for †¢Motor cycle/car- New or re-conditioned. Refrigerator/ Deep Freeze. †¢Television/ VCR /VCP/VCD †¢Radio/ Two-in-one/ Three – in – one †¢Air-Conditioner/ Water Cooler/ Water Pump †¢Washing Machine. †¢Personal Computer/ UPS/ Printer/ Type writer †¢Sewing Machine. †¢House hold furniture- Wooden Steel. †¢Cellular Telephone. †¢Fax †¢Photocopier. †¢E lectric Fan- Ceiling/ Pedestal/ Table. †¢Bi-Cycle †¢Dish Antenna. †¢Baby Taxi, Tempo/Microbus (For self employed persons) †¢Kitchen articles such as Oven, Micro-oven, Toaster, Blender, Pressure Cooker etc. Special Features : †¢No collateral security is required. †¢Simple rate of interest. †¢Quick sanction. †¢Maximum Loan amount Tk. ,00,000/- †¢5% incentive on total interest charged Personal Loan : ________________________________________ Personal Loan Scheme for Salaried Officers- †¢Emergency expenses for own marriage of a service- holder or his dependents. †¢Emergency expenses of urgent surgical operation/ medical treatment. †¢Emergency educational expenses of the children for admission/purchase of books, examination fees etc. Special Features : †¢Any permanent salaried employee aged between 20 to 55 years is eligible to get loan. †¢No collateral security is required. †¢Maximum Amount of loan Tk. 1,00,000. à ¢â‚¬ ¢Maximum period of loan upto 3 years. Deposit scheme: ?Saving account Features : †¢Minimum amount : Taka 1,000. 00 †¢Rate of Interest : 4. 50% †¢Free Cheque-Book facility †¢Opportunity to apply for safe deposit locker facility †¢Collect foreign remittance in both T. C. Taka draft. †¢Transfer of fund from one branch to another by oDemand Draft oMail Transfer oTelegraphic Transfer †¢Transfer of fund on Standing Instruction Arrangement †¢Collection of cheques through Clearing House. †¢Issuance of Payment Order / Call Deposit 1. Special Notice Deposit: †¢Govt. , Semi-Govt. , Autonomous organization and an individual may open SND Account with UBL. 7 days notice required to withdraw. Deposit Amount Below 1 crore Equal and above 1 crore and below 25 crore Equal and above 25 crore and below 50 crore Equal and above 50 crore and below 100 crore Equal and above 100 crore 2. Fixed Deposit Receipt †¢Any Bangladeshi national residing home or abroad may open FDR with UBL. †¢FDR may be opened single/joint name for a period of 3, 6, 12, 24 and 36 months. †¢UBL offers attractive/competitive rate of interest in FDR. Fixed Deposit (FDR) Rate of Interest 13 months above but less than 6 months ) deposit below Tk. 1. 00 crore11. 50% b) deposit Tk. 1. 00 crore and above but less than Tk. 5. 00 crore11. 75% c) deposit Tk. 5. 00 crore and above12. 00% 26 months above but less than 1 year11. 00% 31 year above but less than 2 years11. 00% 42 years above but not more than 3 years11. 00% 3. Double Benefit Deposit Scheme a) Any adult Bangladeshi National will be eligible to open this account. b) Minimum Tk. 1,00,000/- (Taka One Lac only) and multiples thereof will be accepted as deposit under this scheme. c) The period shall be of 8. (Eight years Six months) years term. d) Deposit may be encashed before its maturity and no interest will be paid if encashed before 1(one) year of deposit. e) Interest will be paid at Savings rate if encashed after 1(one) year. f) Advance will be allowed up to 80% of the deposit after completion of one year g) Full amount including interest will be paid on maturity. h) Govt. tax, Surcharge, Source Tax, Levy, Govt. Excise duty will be recoveredfrom the depositor’s A/C. i) Account holder can appoint a nominee against the account. ) Bank reserves the right to close the account at any time and make amendment / alteration of the terms conditions of the scheme Without assigning any reason. 4. Monthly Deposit Scheme a) Any adult Bangladeshi National will be eligible to open this account. b) The period of the scheme will be 5 (five) years and 10 (ten) years term. c) Monthly installment will be Tk. 500/-, 1000/-, 2000/-, 3000/-, 5000/- 10000/- d) Monthly installment to be deposited within 10th day of the month. After due date a penalty of Tk. 50/- will be realized from the A/C holder. If the A/C holder fails to deposit 3(three) consecutive monthly Installments, the account will be automatically closed. e) No cheque book will be issued against the account. f ) Deposit may be encashed before maturity. But no interest will be paid if encashed before 1(one) year of deposit. f) Advance will be allowed up to 80% of the deposit after completion of one year g) Interest will be paid at Savings rate if encashed after 1(one) year of deposit. h) Advance will be allowed up to 80% of the deposit after completion of one year. ) Full amount including interest will be paid on maturity. j) Govt. tax, Surcharge, Source Tax, Levy, Govt. Excise duty will be recovered from the depositor’s A/C. k) Account holder can appoint a nominee against the account. l) Bank reserves the right to close the account at any time and make amendment / alteration of the terms conditions of the scheme Without assigning any reason. (Website of Uttara bank) Shahjalal Islami Bank Limited (SJIBL) Comme nced its commercial operation in accordance with principle of Islamic Shariah on the 10th May 2001 under the Bank Companies Act, 1991. During last ten years SJIBL has diversified its service coverage by opening new branches at different strategically important locations across the country offering various service products both investment deposit. Islamic Banking, in essence, is not only INTEREST-FREE banking business, it carries deal wise business product thereby generating real income and thus boosting GDP of the economy. Management Team is strong and supportive equipped with excellent professional knowledge under leadership of a veteran Banker Mr. Md. Abdur Rahman Sarker. Their Vision is to be the unique modern Islamic Bank in Bangladesh and to make significant contribution to the national economy and enhance customers trust wealth, quality investment, employees value and rapid growth in shareholders equity. Islamic Mode of Investment Bai Mechanism: Bai means purchase and sale of goods in cash or on credit or in advance at an agreed upon profit, which may or may not be disclosed to the client. Majority of investments of Islamic banks are extended through this mechanism. A good number of investment products have been designed to facilitate mainly working capital financing which goes as follows: Bai-Murabaha Murabaha LC(Sight/Deferred): Through this mode of indirect facility, the bank facilitates import of goods of the client at fixed rate of service charge (LC commission) on invoice value. LC may be opened at 100% cash or at a different ratio. Murabaha Post Import TR : This is a post import finance under the principle of â€Å"Bai†, extended to retire Shipping Documents under LC opened. We buy the imported goods and sell the same to the importer at a cost plus an agreed upon profit repayable today or on some date in the future in lumpsum or by installments. Usually payment is made by lumpsum from the sale proceeds of the consignment. Possession of goods remains with the client. Collateral security is usually obtained to secure the finance. Murabaha Post Import Pledge : As like as Murabaha Post Import TR with an exception to security. Goods remain under the control of the Bank. Collateral security may or may not be obtained. Bai-Muajjal Bai-Muajjal Commercial TR: It is an agreement between bank and client whereby bank delivers goods to the client upon deferred payment, i. e. the client shall pay the price at some future date at a time, by lumpsum or by installment. Under this mode of nvestment, bank is not supposed to disclose cost price and profit separately. Goods are delivered on trust and Trust Receipt is obtained for legal implication. Bai-Muajjal (Real Estate): Mode of operation and principle of this product are alike Bai-Mujjal Commercial TR. Difference is with the purpose, i. e. the facility is only extended against construction or purchase of building, apartment etc. Bai-Muajjal (WES Bill): Investment facility under this Mode is extended to liquidate ABP liability at maturity, when the client cannot liquidate the liability as a result of non-repatriation of the related export proceeds. Bai-Muajjal (Term): Under this mode of investment, term facility is given to meet client’s requirement, which is repaid by a specific repayment schedule. Purpose is a bit different, such as to meet BG claim, etc. Bai-Salam Bai-Salam (PC): This is export finance. Bai-Salam is a term used to define a sale in which the buyer makes advance payment, but the delivery is delayed until sometime in the future. Usually the seller is an individual or business and the buyer is the bank. The Bai-Salam sales serve the interest of both parties: a. The seller- receives advance payment in exchange for the obligation to deliver the commodity at some later date. He benefits from the salam sale buy locking in a price for his commodity, thereby allowing him to cover his financial needs whether they are personal expenses, family expenses or business expenses. b. The purchaser benefits because he receives delivery of the commodity when it is needed to fulfill some other agreement, without incurring storage costs. Second, a Bai-Salam sale is usually less expensive than a cash sale. Finally a Bai-Salam agreement allows the purchase to lock in a price, thus protecting him price fluctuation. (Website of SJIBL) Islamic Banking Vs Conventional Banking: An Islamic bank is distinguishable from its conventional counterpart by some basic principles, each of which is derived from the Quran, sunna, or both. The main difference between Islamic and conventional banking is that Islamic teaching says that money itself has no intrinsic value, and forbids people from profiting by lending it, without accepting a level of risk – in other words, interest (known as riba) cannot be charged. There are two major differences between Islamic Banking and Conventional Banking: 1. Conventional banking practices are concerned with elimination of risk where as Islamic banks bear the risk when involve in any transaction. 2. When Conventional banks involve in transaction with consumer they do not take the liability only get the benefit from consumer in form of interest whereas Islamic banks bear all the liability when involve in transaction with consumer. Getting out any benefit without bearing its liability is declared Haram in Islam. To make money from money is prohibited – wealth can only be generated through legitimate trade and investment. Any gains relating to this trading are shared between the person providing the capital and the person providing the expertise. (Website of wiki. answers. com) The unique features of the conventional banking and Islamic banking are shown in terms of a box diagram as shown below:- Conventional BanksIslamic Banks 1. The functions and operating modes of conventional banks are based on fully manmade principles. 1. The functions and operating modes of Islamic banks are based on the principles of IslamicShariah. . The investor is assured of a predetermined rate of interest. 2. In contrast, it promotes risk sharing between provider of capital (investor) and the user of funds (entrepreneur). 3. It aims at maximizing profit without any restriction. 3. It also aims at maximizing profit but subject to Shariah restrictions. 4. It does not deal with Zakat. 4. In the modern Islamic banking system, it has become one of the service-oriented functions of the Islamic banks to be a Zakat Collection Centre and they also pay out their Zakat. 5. Lending money and getting it back with compounding interest is the fundamental function of the conventional banks. 5. Participation in partnership business is the fundamental function of the Islamic banks. So we have to understand our customers business very well. 6. It can charge additional money (penalty and compounded interest) in case of defaulters. 6. The Islamic banks have no provision to charge any extra money from the defaulters. Only small amount of compensation and these proceeds is given to charity. Rebates are give for early settlement at the Banks discretion. . Very often it results in the banks own interest becoming prominent. It makes no effort to ensure growth with equity. 7. It gives due importance to the public interest. Its ultimate aim is to ensure growth with equity. 8. For interest-based commercial banks, borrowing from the money market is relatively easier. 8. For the Islamic banks, it must be based on a Shariah approved underlying transaction. 9. Since income from the advances is fixed, it gives little importance to developing expertise in project appraisal and evaluations. 9. Since it shares profit and loss, the Islamic banks pay greater attention to developing project appraisal and evaluations. 10. The conventional banks give greater emphasis on credit-worthiness of the clients. 10. The Islamic banks, on the other hand, give greater emphasis on the viability of the projects. 11. The status of a conventional bank, in relation to its clients, is that of creditor and debtors. 11. The status of Islamic bank in relation to its clients is that of partners, investors and trader, buyer and seller. 12. A conventional bank has to guarantee all its deposits. 12. Islamic bank an only guarantee deposits for deposit account, which is based on the principle of al-wadiah, thus the depositors are guaranteed repayment of their funds, however if the account is based on the mudarabah concept, client have to share in a loss position.. (Website of zaharuddin. net) Bibliography Here are some web addresses we use in our study: I. Official website of SJIBL, see http://www. shahj alalbank. com. bd/default. asp II. Official website of UBL, see http://www. uttarabank-bd. com/ III. â€Å"Similarities and differences between Islamic banking and conventional banking†, see http://wiki. nswers. com/Q/List_similarities_and_differences_between_Islamic_banking_an d_conventional_banking IV. ‘Islamic Banking†, see http://www. sooperarticles. com/finance-articles/demystification-islamic-banking-166518. html V. â€Å"Islamic-Banking-vs-Conventional-Banking†, see http://www. scribd. com/doc/17116904/Islamic-Banking-vs-Conventional-Banking VI. Rahman Zaharuddin, â€Å"Differences between Islamic Bank and Conventional Bank† see http://zaharuddin. net/index. php? option=com_contenttask=viewid=297Itemid=72 (all are accessed in 21st October 2011)

Three Day Food Intake Paper Essay Example

Three Day Food Intake Paper Essay Example Three Day Food Intake Paper Essay Three Day Food Intake Paper Essay The proper nutrition plays a major role in having good health. Without the proper nutrients the body cannot function proper and can open the body up to any number of disease like heart disease, some cancers, diabetes, obesity, anemia, and high blood pressure. During this three day intake this writer has learn about her eating habits and ways to improve them. Proteins The Daily Recommended Intake Report states this writer should be getting 102 o 356 grams of protein a day in her diet, but she is only getting 82 grams a day which is below the recommended range. This can be a problem if she does not get the recommended amounts her body needs. According, to the Office of Womens Health (2008). Women need protein to help break down food for energy and breaking down toxins in the body. She can increase the amount of protein she gets by eating more red meats, eggs, nuts, peanut butter, beans, lentils, milk, and soy products. Carbohydrates The Daily Recommended Intake Report states this person should be getting 58 to 661 grams of carbohydrates a day in her diet. She is only getting 308 grams which is well below the The recommended amount for her body. Carbohydrates provides energy the cells in her brain, nervous system, and blood. It also, supplies her muscles while she exercise. Without carbohydrates her body will not have the energy it needs to proform properly. She can increase the carbohydrates she needs by eating more complex carbs like- salads and pastas. Also, staying away from the simple carbs like sugar. Lipids and Fiber The Daily Recommended Intake Report states this person should be getting less than 30 grams of fat in her diet a day. She is now getting 41. 3 grams of fat in a day. The American Heart Association (2013) recommends that a person should not eat more that 25 to 35 % of fat in their diet a day and of this amount no more than 7 percent of it should be saturated fats. This writer can reduce she total daily intake ot tats by consuming more t that are low in saturated tats. Also, she can cook her foods with oils like corn oil, canola oil, and olive oil. We needed some fats in our diet to help provide a source of energy. It is also, used by the body to absorb certain vitamins from food we eat. This writer should be getting 25 grams of fiber a day in her diet (K. Zelman, 2011). Right now she is only getting 12 grams which is only 48. 2 % of the daily recommended amount. By not having the right amount of fiber in her diet can lead to constipation, higher LDL levels, and high blood sugar levels. In turn this can lead to colon cancer and diabetes. She can reduce her hances of these diseases by eating more dark green leafy vegetables, corn, nuts, whole wheat products, beans, and fruits. Dietary Modifications This writer has identify many patterns in her diet that need to be change in order to lose the extra weight that has put her at risk. She needs to eat more regularly and the right types of foods for her nutritional needs. She needs to get moving more and not Just sit around the house doing nothing. She needs to add more fruits, vegetables, carbohydrates, vitamins, minerals and water to her diet. She needs to stay away from the simple carbs and go for the more complex carbs that will help to give her the fuel that her body needs. According to Mary Fetzer (2012), Fiber helps to keep you feeling full and satisfied and more in control of your appetite and weight. This writer can help herself to achieve her goal of a healthy weight and body by making some modifications to her diet and life style. By eating more of the foods that help her to get all the vitamins, minerals, and water that her body need she can help herself to prevent heart disease, some cancers, diabetes , high lood pressure, kidney disease, high cholesterol (especially the levels of LDL the bad cholesterol). If she follow her plan to change her eating habits she can change her health for the better. References American Heart Association. (May 1, 2013). Know Your Fats. Retrieved from http:// American Heart Association. org Fetzer, M. (April 14, 2012). What is fiber and how does it work? Retrieved from http://She Knows. com Office of Womens health, U. S. Department of Health and Human Services. (2008, June 17). Womenshealth. gov. Retrieved from http://Womenshealth. gov

E-commerce and Information Systems Essay Example | Topics and Well Written Essays - 250 words

E-commerce and Information Systems - Essay Example The sampled secondary data retrieved from the E-commerce and information systems scholarly journals were then analyzed using a number of the formulated research hypothesis, which is used to weigh the qualitative agreement or disagreement of the retrieved scholarly journals on E-commerce and information system matters. The results from the research analyzes are used to draw inferences drawn from the hypothetical juxtaposition of the scholarly argument and concurrence on the interaction between E-commerce and information systems together with the impact of the postulated interaction of a business as a whole. These inferences are then used to reaffirms or refutes the thesis about the functional correlation between E-commerce and information systems. The inferences are also intended to reaffirm or refute the research position of an information systems dependent E-commerce (Wymer & Regan 2011, p 27). Finally, the inferences are used to establish the level of advancement of information sys tems employed in e-commerce, which in turn determines their safety or vulnerability to exploitation for malicious damage of a business. The research addresses the question of the functional correlation between e-commerce and information system as a novelty subject in business management and marketing (Grand, Mykytyn & Nascob, 2011, p 18). It also provides a hypothetical framework for research in e-commerce and information system in the context of organizational management and marketing. Wymer, S. and Regan, E. A., 2011.  

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Art unit 7 discussion - Research Paper Example (The Public Wants Help Achieving the American Dream by Ruy Teixeira. 2007) Different cultures and countries perceive happiness in different ways. In western countries, such as Latin America, people believe that they are happy if they have achieved all their goals in their life. In socialist countries such as Japan and China, people have more of a philosophical view towards happiness. They believe that happiness is a blessing from God, and one’s capability or personal accomplishments, do not play a part in this. For example, in Japan people consider that they have acquired happiness by performing their social duties, satisfying the hopes of their families, and by co-operating with others. To them, happiness is achieved more by assisting the society, unlike America where people consider themselves to be happy after gaining pride and success in their lives. (The pursuit of happiness, New Scientist.

Microeconomics Coursework Essay Essay Example for Free

Microeconomics Coursework Essay Essay Critically evaluate and discuss the advantages and disadvantages of Customer Boycotts. Compare and contrast either Coca Cola or Bacardi with another consumer boycott of your choice and discuss appropriate microeconomic theoretical models. Firstly to understand this question we need to understand what a customer or consumer boycott actually is. Well it is normally called by an organisation or a group of individuals, asking consumers not to buy a specific product, or the products of a specific company, in order to exert commercial pressure. This is usually done to get the company to change behaviour, to cease an activity or to adopt a more ethical practice. For this essay I am going to discuss many advantages and disadvantages of consumer boycotts and also I have decided to compare and contrast coca cola with the Nestle boycott. There are various ways to make a boycott efficient. To be efficient a reduction of 1-2% of turnaround of a company (or product) is seen as the critical mass needed. (27 Mar 2003, Demanding consumer [online]. Available at:). Boycotts can be successful, for example, in 1986 Rainforest Action Network launched a boycott of Burger King. This was because of Burger King importing beef from tropical rainforest countries because it was cheap. But the rainforests were getting destroyed in order to provide pasture for cattle. As a result of the boycott, Burger Kings sales dropped by 12%. In response, Burger King cancelled thirty-five million dollars worth of beef contracts in Central America and announced that the company would stop importing rainforest beef. Boycott calls are at times controversial because they may be called by groups from the political side or for activities that people dont specifically disagree. Boycott efforts can include protests against everything from  investing in a politically undesirable country to discouragement of the eating or drinking of products from certain companies or countries. Boycotts are not always effective and only a limited percentage of countries consumers will participate in one. While many people are sympathetic to the reason behind a boycott, not enough people join in. One of the main reasons is that people do not see their actions as having any results. This may be partly due to only concentrating on what happens to the primary target of a boycott. But there are also secondary effects which I will talk about later. There are many advantages to consumer boycotts that I will discuss now. Obviously the main advantage is when the boycotts work, as said above with the boycott of burger king, and the company consequently changes its ways. But more often than not boycotts rarely change the companies ways or at least so that the consumer knows about it. One advantage is that boycotts are a way that consumers can use their power for positive social change. Boycotts can be effective because when successful they will result in increased public scrutiny of the company. This in turn will cause concerns inside the company about lost profits from the loss in consumer interest and companies are always concerned about their financial position. Another advantage is that a boycott can hold a company accountable for any policies that negatively affect the environment or people. This is an advantage because a company could be ignoring the problem but with a consumer boycott more and more people will find out about the problem and may also decide to join in. The negative coverage that will arise from media coverage of the boycott may become a big problem for the company in the long run, since competitors may gain a relative advantage. An example of this is that after the boycott of French wines in Denmark had calmed down, the French wines had lost 20 percent market share. Also there was a bigger problem, because the general impression was that consumers could be persuaded to switch back to French  wines. But many supermarket shelves had been reorganised in order to give more space to Italian and Spanish wines, and this was considered a more serious problem. (Can Consumer boycotts work, 2002 [online]. Available at: I mentioned briefly earlier something called a primary effect, well this would be where the target organisation changes its practice. Many targets are however reluctant to change as the result of hostile pressure, and even if changes are made they may try to hide the fact that the consumer action had any effect. There is also the fact that most boycotts are small by comparison to the overall sales, so a target can ride out a boycott. Thus the primary effects may be small and many boycotts may be judged not to have succeeded. So this could be seen as a disadvantage. But the secondary effects are an advantage and are the effects that are not connected to the target. They are effects on other organisations that are not in conflict and can therefore change without the public knowing. Secondary effects can be changes to regulations, lasting change in industry practices, allowing substantial growth entrance of ethical players into the market or effects on decisions of similar organisations to the target. (Why Secondary Effects, [online]. Available at: An example of secondary effects is if someone refuses to buy Nescafe (the coffee brand from Nestle) then he may choose to buy a brand from a much smaller company. The positive effect to this smaller company is much larger than the negative effect to Nestle. The new company may find out that many people are switching to it on ethical grounds and position itself in the market to take advantage of this by, for example, publishing a code of conduct. Having switched brand once this person will have less brand loyalty and a newly formed company will know this by market research and will know they have a better chance of success in the coffee sector. (Why Secondary Effects, [online]. Available at: The boycott campaigns can also be important in developing political consciousness and can be one of the few non violent means to create political pressure. Another advantage is the exposure of the company and with less people buying their products the consumers will be looking at  buying substitute goods and therefore the demand for these will increase and therefore the supply will also increase. Consumer boycotts will increase competition in the market and firms will reduce their prices as a result to compete and also to gain the extra consumers that have less brand loyalty. The firms profits will also reduce and the smaller firms will gain more of the market share. There are also disadvantages to boycotts though. One of these could be a large reduction in jobs, Boycotting Nestle products wont help the poor farmers who sell to the company, the head of Oxfam said. (Charlotte Denny, 2002. Retreat by Nestle on Ethiopias $6 debt [online]. The Guardian. Available at: ) They can have an adverse impact on individuals and communities which become innocent victims of the economic damage that boycotts can cause. Obviously there are disadvantages for the company as the reputation of the company will be harmed as a result of the impact of consumer boycotts, this isnt good for it as it would need to lower its prices because the demand will become less. This is shown below As the demand falls so does the equilibrium price (Pe1 to Pe2). Another disadvantage to the company is that the company budgets will get ruined and will need to be analysed and changed. Also the gross domestic product of the host country could fall which is a disadvantage. In extreme cases there could be a loss of multinational specialisation and technology in a third world country as the company may not do their business their. There could be a loss of consumer choice if the product ceases after a boycott. Boycotts like that of advertising of cigarettes can cost businesses their survival, as in motor racing as half the advertising used to come from cigarette companies. Now a lot struggle to get the advertising money needed. There can also occasionally be some violence resulting from the boycotts and also resentment. Another disadvantage for consumers would be that some people would argue that all publicity is good publicity. Now I will compare and contrast the consumer boycott of coca cola with the consumer boycott of Nestle. Coca cola is the worlds fastest selling non-alcoholic beverage and the consumer boycott of it started on the 22nd July 2003. The reason behind the boycott is because they are accused of complicity in the assassination of 8 Sinaltrainal trade union leaders in Colombia since 1990. Sinaltrainal is a trade union and it organisers workers in the food and drink sector. Many other of the leaders have been imprisoned, tortured, forcibly displaced and exiled. Coca Cola deny any responsibility for these murders. They say that 100s of union leaders are killed every year in Columbia. However many of the murders were made inside Coca Cola plants while negotiating agreements. Coca cola management were reported in the national press as meeting and contracting members of the AUC death squads to sort out their labour problems. (Boycott Coca Cola, [online]. Available at: Since 1977, Nestle has been the subject of an international boycott for its deceptive promotion of artificial baby milk as a superior alternative to mothers milk. Artificial baby milk can harm babies because it does not contain the natural anti bodies which a mothers milk provides, and because it is extremely expensive, causing many mothers to mix it with too much water resulting in mal-nutrition. Also, in many places the water used to dilute it is not portable. Once a mother starts giving her baby the formula, her own supply of milk dries up. Nestle provides free packages of formula in hospitals with the result that many babies never ever even get a chance to start nursing. In 1988 the boycott was re-launched when it was discovered that the company did not abide by its promise to follow the World Health Organisations International Code of Marketing of Breast-Milk Substitutes. (A Consistent Corporate Criminal, [online]. Available at: ). There have been massive impacts on Nestle because of the boycott. In 1984 the boycott forced Nestle to agree to abide by the World Health Organisations International Code of Marketing of breast Milk Substitutes. But now it was discovered that the company has not abided by its promise so the boycott was re-launched. Also in one afternoon 8,500 people emailed Oxfam to complain about Nestle, this was the fastest response Oxfam says it has had to a campaign. (Charlotte Denny, 2002. Retreat by Nestle on Ethiopias $6 debt [online]. The Guardian. Available at: ). Coca cola is in the non-alcoholic beverage market whereas Nestle is one of the worlds largest food manufacturers; it is also though same as coca cola in the beverage market. With a consumer boycott against both of these two companies, this means that the demand for both of their products will decrease as a result, causing an increase in the demand for substitute goods, like Pepsi instead of Coca Cola. Also because there is a shift in the demand curve this leads to a movement along the supply curve so the price of the goods, coca cola or a nestle brand will go up from P1 to P2 and the quantity in equilibrium falls from Q1 to Q2. This is a supply and demand graph for what has happened with coca cola and Nestle because of the consumer boycott against them. This is a supply and demand graph for what happens to the demand for a substitute good like Pepsi for coca cola because of the boycott. If a company has a strong consumer loyalty then a boycott would be unlikely to have much of an effect on the number of people who choose to join in and not purchase their products, however if a company has failed to build up a strong consumer loyalty then consumers will find it easy to decide to no longer purchase their product and will purchase the competitors products. Why have both Coca Cola and Nestle continued to upset consumer groups when  they could easily change there policies and consequently have the boycotts against them lifted. The answer to this is that the company must be getting more financial gain from what ever is upsetting the consumer groups than the loss of revenue that the boycotts have brought about. Both Nestle and Coca Cola are oligopoly markets because there are just a few firms that share a large proportion of the industry. Both of the markets of Nestle and Coca Cola are differentiated, because they both produce many types of the product. Coca Cola and Nestle are the same as much of the competition between such oligopolists is in terms of the marketing of their particular brand. There are barriers to entry into both markets, these could be product differentiation and brand loyalty, where there are differentiated products where the consumer associates the product with the brand, and it will be very difficult for a new firm to break into that market. The problem would be being able to produce a product sufficiently attractive to consumers who are loyal to the familiar brand. (John Sloman, 2003. Economics. Fifth edition. (s.l.): Pearson Education). Another barrier could be lower costs for an established firm. The companies are likely to have specialised production and marketing skills. They are more likely to be aware of the most efficient techniques and the most reliable and/or cheapest suppliers. They are also likely to have access to cheaper finance, therefore operating on a lower cost curve. New firms would find it hard to compete and be likely to lose any price wars. Aggressive tactics or intimidation could also be used. (John Sloman, 2003. Economics. Fifth edition. (s.l.): Pearson Education). Because Nestle and coca cola are in the oligopoly markets they both are affected by their rivals actions and vice versa. Because of this the firms could wish to collude and act as though they are a monopoly so they could jointly maximise their profits, or the firms could try and compete with their rivals to gain a bigger share of industry profits. Because Coca Cola and Nestle are both the leading firms in their industries, tacit collusion could form where they set the prices for their markets. Oligopolists will not engage in price cutting, excessive advertising or  other forms of competition. By doing this profits will be maintained in the long run. If oligopoly firms compete, profits are low and consumers benefit. If there were a rise in price of Coca Cola or a Nestle product e.g. Nescafe, then this would lead to a large fall in the quantity demanded. This is because consumers would buy alternative substitute goods like Pepsi or another coffee brand. The reason is because both coca cola and Nestle products are elastic products. After looking at both the advantages and disadvantages of consumer boycotts, I have found out that even though the firms lose consumer loyalty, lose revenue and get public scrutiny the firms must be coming out on top and are gaining financially, otherwise they would change their ways. This is probably why Nestle maybe did start to abide by the World Health Organisations International Code of Marketing of Breast-Milk Substitutes, then realized how much revenue they were losing so changed back even knowing they were likely to have the boycott brought back aswell because they must be gaining financially, but this is only my opinion. Also the other businesses in the market that whilst their competitors are having their products boycotted can take advantage and increase their own financial position and customer base.

The Effects of Global Warming on Wetlands :: Geology

The Effects of Global Warming on Wetlands Introduction Wetlands are highly productive ecosystems. Wetlands include marshes, estuaries, bogs, fens, swamps, deltas, shallow seas, and floodplains. Wetland habitats support a vast range of plant and animal life, and serve a variety of important functions, which include water regime regulation, flood control, erosion control, nursery areas for fishes, fish production, recreation, plant production, aesthetic enjoyment, and wildlife habitat. Wetlands account for about 6% of the global land area and are among the most valuable environmental resources. The Problem The potential impacts of climate change on wetlands are of great concern. Increasing atmospheric concentrations of carbon dioxide and other greenhouse gases released by human activities are generally expected to warm the Earth a few degrees (C) in the next century by a mechanism known as the "greenhouse effect." Such warming could raise sea level by expanding ocean water, melting mountain glaciers, and eventually causing polar ice sheets to side into the oceans. Among the coastal areas of greatest risk in the United States are those low-lying coastal habitats that are easily eroded and which occur along the northern Gulf of Mexico and southern Atlantic coasts of the U.S. These coastal wetlands are especially vulnerable to direct, large-scale impacts of climate change, primarily because of their sensitivity to sea-level rise. Observational records indicate that sea level has already risen between 10 and 25 cm globally over the past 100 years. In addition, the Intergovernmental Panel on Climate Change (IPCC) has projected a sea-level rise of 15-95 cm as a consequence of global warming. Sea-level rise will also increase the depth of coastal waters and increase inland and upstream salinity intrusion, both of which affect fresh and brackish water wetlands. Sea-level rise has the potential for increasing the severity of storm surges, particularly in areas where coastal habitats and barrier shorelines are rapidly deteriorating. These direct consequences of global- and regional-scale changes will increase the vulnerability of coastal wetlands which are already heavily impacted by human activities. Analysis of sites in five coastal states indicate that many marshes and mangrove ecosystems receive adequate mineral sediments to produce enough organic sediment and root material to remain above sea level at the present rate of sea-level rise (1-2 mm per year globally). However, three of the twelve wetlands studied were not keeping pace with the current rate of sea-level rise. If sea-level rise accelerates, some additional sites would also begin to slowly deteriorate and submerge. The Effects of Global Warming on Wetlands :: Geology The Effects of Global Warming on Wetlands Introduction Wetlands are highly productive ecosystems. Wetlands include marshes, estuaries, bogs, fens, swamps, deltas, shallow seas, and floodplains. Wetland habitats support a vast range of plant and animal life, and serve a variety of important functions, which include water regime regulation, flood control, erosion control, nursery areas for fishes, fish production, recreation, plant production, aesthetic enjoyment, and wildlife habitat. Wetlands account for about 6% of the global land area and are among the most valuable environmental resources. The Problem The potential impacts of climate change on wetlands are of great concern. Increasing atmospheric concentrations of carbon dioxide and other greenhouse gases released by human activities are generally expected to warm the Earth a few degrees (C) in the next century by a mechanism known as the "greenhouse effect." Such warming could raise sea level by expanding ocean water, melting mountain glaciers, and eventually causing polar ice sheets to side into the oceans. Among the coastal areas of greatest risk in the United States are those low-lying coastal habitats that are easily eroded and which occur along the northern Gulf of Mexico and southern Atlantic coasts of the U.S. These coastal wetlands are especially vulnerable to direct, large-scale impacts of climate change, primarily because of their sensitivity to sea-level rise. Observational records indicate that sea level has already risen between 10 and 25 cm globally over the past 100 years. In addition, the Intergovernmental Panel on Climate Change (IPCC) has projected a sea-level rise of 15-95 cm as a consequence of global warming. Sea-level rise will also increase the depth of coastal waters and increase inland and upstream salinity intrusion, both of which affect fresh and brackish water wetlands. Sea-level rise has the potential for increasing the severity of storm surges, particularly in areas where coastal habitats and barrier shorelines are rapidly deteriorating. These direct consequences of global- and regional-scale changes will increase the vulnerability of coastal wetlands which are already heavily impacted by human activities. Analysis of sites in five coastal states indicate that many marshes and mangrove ecosystems receive adequate mineral sediments to produce enough organic sediment and root material to remain above sea level at the present rate of sea-level rise (1-2 mm per year globally). However, three of the twelve wetlands studied were not keeping pace with the current rate of sea-level rise. If sea-level rise accelerates, some additional sites would also begin to slowly deteriorate and submerge.

How Marriage Works

â€Å"Marriage is the process by which two people make their relationship public, officials and permanent† according to PsychologyToday. Marriage allows your relationship to be recognized by the government. People can marry for multiple reasons, including religion, economic benefits, or for love and companionship. The social clock has changed in America, with more people marrying later in their life. There are many reasons why people are deciding to push marriage off. Marriage can be both beneficial and negative.Marriage can provide better economic stability for both partners. When you marry, you can receive a marital tax deduction. This allows you to transfer assets to your spouse without being taxed for it. You are also able to obtain your spouse's benefits including social security and health insurance. Prenuptials are a secure way to keep your assets in marriage. By having a prenuptial, people can keep their original assets no matter if there is a split or divorce. Married couples are generally more financially stable, with â€Å"the median household income of married families is twice gag of divorced households and four times that of esperares households† according to the website Marripedia.Married people also have mental health and biological benefits. For example, married people typically live longer: â€Å"Research consistently shows that couples in a committed marriage live longer that those that are single† said Ivy Jacobson, author of the article â€Å"13 Legal Benefits of Marriage.† Because both people feel constant support from their partners, mental stability is improved, allowing the couple to live longer and decrease the chance of depression. Mental health is extremely important in the health of the relationship. By bottling up emotions and thoughts, it can negatively impact your self-esteem and increase stress. By having a partner, you are allowed to open up and feel heard, decreasing that stress and improving the way you look at yourself. Marriage increases serotonin levels. Serotonin is a chemical and neurotransmitter in the human body and is â€Å"sometimes called the happy chemical because it contributes to wellbeing and happiness† stated James McIntosh in his article â€Å"What is Serotonin and What Does It Do?† Having a significant other to provide physical affection and emotional support triggers the release of serotonin, helping create a positive mindset. Marriage can also result in divorce and financial stability. According to the website DivorceStatistics, â€Å"current divorce statistics in America is estimated to be fifty percent.† It is projected that the divorce rate will continue at this same rate in the future, making your chance of a lasting marriage unlikely. As well as a chance that your marriage will fail, a divorce is very expensive. A divorce with child custody and support issues cost about 26 thousand dollars. A divorce without child custody and support is about 17 thousand dollars. These extremely high costs can leave both sides of the party in major economic distress. There is also a possibility that you could be marrying into a financial burden. If one person obtains debt, the spouse will carry that debt as well. â€Å"Researchers analyzed the relationship of 4500 couples and found arguments about money were the the top predictor of divorce† says Nancy Durham, author of â€Å"Should You Tie the Knot? Financial Reasons Why Marriage Might Be A Misstep.† As a married couple, you will need to plan your future financial situations and be able to save money efficiently. Negative mental health characteristics can also arise from marriage. One spouse may become too emotionally dependent on their partners, causing stress and tension between the two. That spouse may start to feel as though they need their partner to be happy, and can become too emotionally reliant on them. As well as one partner being too emotionally invested, mental health disorders do not help. Negative emotional reactions caused by disorders can become intensified. Partners that cannot get the support and assistance they need from their partners often resort to substance abuse and isolation. According to Pierre Imlay, a mental health therapist, in his article â€Å"Mental Illness in Couple Relationships,† â€Å"when the marital stress is at its peak, there's a greater likelihood of substance misuse, movement toward divorce, and male aggression.† Marriage can be viewed in both a positive and negative way. Marriage can be very beneficial to couples that have communicated to each other about their expectations for the relationship and marriage, their future, economic situation, and their mental health. If there is a major disagreement, you may want to rethink about getting married and weigh out the pros or cons, or else you may just end up being another statistic for divorce. Although marriage has many components that should be discussed beforehand, it ultimately is a beautiful thing that should be shared and taken seriously.