Pre-activity Health Screening Case Study

Pre-activity Health Screening Case StudyWhen an in b danger soulfulness decides to participate in physical activity for the first succession, in that location is a danger of possible major coronary problems. Sharkey and Gaskill (2007) state that inactive people who decide to start an activity ar five times much at risk during vigorous exercise. The risk of engaging in exercise varies by the type of exercise and intensity, which a person participates in. This would mean the individual with cardiovascular problems is more at risk of having coronary problems. Sharkey and Gaskill (2007). As suggested by NHS Choices (n.d.) the risk can be dramatically reduced when completing a pre-activity wellness screening.Pre-activity health screening is a tool used mostly by exercise professionals. It refers to the process of collecting information about an individuals medical history and health experimental condition Heaney and Goodey (2012, p.136). This normally involves completion of a phys ical activity readiness questionnaire (PAR-Q). In addition physiological measures would also be done like height, weight, body bus index (BMI) body-fat percentage and waist-to-hip ratio (WHR). These are necessary to identify any further potential risks factors a person has relating to coronary optic distemper(CHD)Heaney and Goody (2012)The American College of Sports Medicine (ACSM) cited in Heaney and Goodey (2012, p.139) recommended that people are categorized into low, medium and high-risk factors. For example, primary risk factors are those at the highest risk, this embarrasss hypertension, cigarette smoking and those with high-cholesterol levels. Secondary risk factors are those classified as medium risk. For example, diabetes type one and two obesity and physical inactivity. Furthermore, the non-modifiable risk factors are classified as low risk. This would include men over 45 and women over 55, in addition to gender and a family history of midsection disease.Another impor tant factor is customer fearfulness, Sinka, I. (2012) suggested that if a fitness company wants to offer their services to a customer, then the customer needs to believe the service is worth take aimn part in. Not altogether does a pre-activity health screening ensure that the correct exercise programmes are offered, but also table services to understand and meet the customer needs. Furthermore, It is necessary for health and safe reasons. Completion of a pre-activity health screening demonstrates that health, and safety is always organism considered. Similarly, as suggested by Jason Wamala pre active health screening reduces the risk against potential profound liability to the organization and employees. The open University (2008)Do Daisys results from the health screening physiological measurements fall into healthy ranges.The results show a number of risk factors that are believably to lead to the development of cardiovascular disease. Daisy is 55 years-old sources from A CSM, 2006 Woolf-May, (2006) cited in Heaney and Goodey (2012, p.139) implies that Daisy is at risk to coronary heart disease genetic or lifestyle factors cause governing body to be build-up in your arteries as you age. By the time youre middle-aged or older, enough plaque has built up to cause signs or symptoms. National heart and lung Institute (n.d.)Blood pressure tends to rise with age this could guide part of the reason why Daisy has a resting split pressure of 160/100 millimeters of atomic number 80 (mmHg), this indicates that Daisy has high blood pressure referred to as stage two hypertension. The Open University (2008) suggested that high blood pressure greater than 140/90 mmHg can dramatically increase your risk of developing cardiovascular disease such as heart attack or stroke. Marie Toms suggested that it whitethorn be worth retesting Daisy more than erstwhile The Open University (2008). National heart and lung Institute (n.d.) suggested that blood pressure did not s tay the same throughout the day. It is a lot lower while you respite and rise when you wake up. Blood pressure tends to rise when youre excited, nervous or active. If your blood pressure is above average most of the time, youre at risk to CHD.Daisys resting heart rate is ninety six beats per minute (bpm), the average bpm should be between sixty to one hundred bpm, NHS, (n.d.). However, Daisy is within the guidelines yet let off at risk. NHS (n.d.) states that the resting heart rate is the number of beats in one minute when the body are at a complete resting state so the more your heart beats the more strain you vomit up on your heart.Looking at Daisys body mass index (bmi) which is 29.01, this indicates that Daisy has an increased health risk. apply the guidelines from Sharkey and Gaskill (2007, p.242.), indicates that Daisy has a desirable BMI of between nineteen to twenty five. Sharkey and Gaskill (2007) also suggested that having a higher than desired BMI puts Daisy more at r isk of atherosclerotic heart disease and hypertension. Since Daisy is inactive, and the results from the BMI indicate she is overweight NHS, (n.d.) suggested that these are 2 factors that stir an increase risk of hypertensionwaist to hip ratio of 0.9 would indicate that Daisy has she is above average 0.86(study guide) this would indicate Daisy is more at risk In particular, heart disease, high blood pressure and diabetes develop when the inflammatory effectuate of that mass of fat hit your blood vessels Sharkey and Gaskill (2007) This would indicate why this individuals body fat percentage is so high, 25 for women is average so 33 percent is bad. The excess weight can put you at increased risk of heart disease, stroke and type two diabetes.To conclude Daisy needs to make some big life changes to avoid being at risk of CHD. For example, exercise regular to help her lose weight, lower her BMI and WHR. In addition to lowering her risk factors to CHD.Outline how physical activity coul d shed a positive effect on Daisys health.Daisy is overweight and is bordering obesity with a BMI of 29.01, Sharkey and Gaskill (2007) suggested that obesity along with lack of activity has been suspected to have a get in touch between coronary artery disease (CAD), hypertension and type two diabetes. For example, an increase level of blood lipids (fat) in the body increases insulin resistance. This means that the insulin-resistant cells cant take in glucose. Glucose levels then rise, which results in the release of more insulin, this in turn increases blood pressure ca utilise possible hypertension and type two diabetes. Sharkey and Gaskill (2007)For example, a study was published by Morris and raffle (1954) cited in Sharkey and Gaskill (2007, p.17.) Showing a link between inactivity and CAD, the bus drivers were tested along with the conductors. The conductors were more active then the bus drivers and were shown to have a 30 percent lower risk of CAD then the bus drivers. It is also suggested by NHS (n.d.) that inactivity increases the risk of hypertension by thirty-five percent. The result published by (Morris and raffle) would suggest that physical activity would benefit Daisy and lower her risk to hypertension and CAD.In addition, deal with very high blood pressure are three times more apt(predicate) to experience CAD and four times more likely to get congestive heart failure then others. Sharkey and Gaskill (2007). Research has shown that physical activity can reduce blood pressure, in middle-aged and older women and any(prenominal) inactive person engaging in exercise has a 60 percent lower risk of heart attack. Sharkey and Gaskill (2007). It is suggested that regular physical activity help prevent CHD by increasing the efficiency of the cardiovascular system, and example would be increased blood volume and decreased blood pressure.Daisy also runs her own business, which suggested Daisy may be under stress. Sharkey and Gaskill (2007) suggested that stress is associated with heart disease and hypertension. To conclude daisy needs to include some regular moderate activity may minimize the effects of stress and more importantly reduce the risk from cardiovascular disease.What legislation governs health and safety in a sports and fitness facility, and how might these relate to this mishap? (250 words/13 marks)Health and safety requirements are supported by tort law. This is a wide athletic field of law covering areas such as negligence and occupiers liability. For example, Heaney and Goody (2012) negligence in tort law concerns situations where a person suffers injuries out-of-pocket to carelessness, forgetfulness or thoughtlessness due to the results of another person. This would mean that person has breached their legal duty to take care. It would make them liable to that person for negligence.An example would be Susan the 14-year-old daughter of Alistair, the father and daughter are fully aware of the health clubs policy re lating to no under-16s, and every member has to complete a gym induction and health screening. The father owes a duty of care to his daughter, as he should be competent to understand the policies that the gym has in place. In addition, Goodey, J (2008) p152) suggested that an occupier may not be liable for injuries to a child if come with by someone competent enough to look after them.Furthermore, statute law refers to the act of law made by parliament, this includes the health and safety at work act 1974 (HASWA 1974). For example, HASWA 1974) cited in Heaney and Goody (2012) 153 an employer must undertake all necessary measures to ensure visitors to their set forth are not exposed to risks of health and safety. in that respect is the management of health and safety at work regulations 1999 (MHSWR 1999) MHSWR 1999) cited in Heaney and Goody (2012) state that management running a health and safety facility are required to conduct a risk assessment to ensure the welfare of employees and visitors.Consequently, the fact Susan was still able to access the gym after claiming to be using the pool only may indicate that the employer has not taken all the necessary measures that fall under (HASWA 1974) and (MHSWR 1999).Discuss whether or not Alistair and his 14-year-old daughter Susan would have a case for a claim for negligence against the facility.There are many factors to consider that explain why Susan may not have a claim for negligence against the facility. One consideration may be that it falls within the occupiers liability act 1984 cited in Goodey, J (2008p.151) states that a person who controls the premises is responsible for allowing or preventing access to visitors. It can be argued that Susan gained access to an unauthorized part to the facility. Therefore, the duty of care expected of the facilities owner was not met. This would be due to insufficient security measures to prevent unauthorized access to non gym members and people under the age of sixteen . However, Alistair is Susans father so already has a duty of care toward his child. Alistair is already a member of the gym, he has participated in an induction and health screening. Alistair is aware of the facilities policy that under sixteens are not allowed within the gym area therefore, Alistair has been a regular user with the facility. You would therefore expect Alistair to have a higher standard of competence. In addition, Susan is cardinal years old, it is thought that age fourteen they would have some awareness. (Heaney and Goody (2012)Susan went on to use a piece of gym equipment inappropriately, which highlights the cause of her injury. You could argue that the instructor supervising the gym at the time breached the duty of care for inadequate supervision. (Heaney and Goody (2012) However, the gym instructor would assume that all members in the gym at the time would have met the gym requirements and realised the induction and health screening. In addition, the instruc tors response to the accident was immediate and appropriate, as a result would indicate that the facility takes its duty of care seriously.To conclude the absolute majority of Susan and Alistairs own negligence may have contributed to her injuries. Therefore, it would be suggested that Alistair and his 14-year-old daughter Susan would not have a case for negligence against the facility.Word count 1989

The Natural Insulation Materials Construction Essay

The Natural Insulation Materials twist EssayThis is usually the character reference of edifice that argon considered alternate today, save their heredity in structures that humans have been constructing for centuries. The reason why these furbish up techniques atomic number 18 gaining prevalentity in innovational times is devilfold. First, the old winding techniques argon farthest more than eco-friendly than the majority structures we utilise to encountering second, these structures ar simple replete in nature that they can build cheaply and can be create without the aid of a lot of the heavy and expensive equipment which is normally related with most new tress.Currently words much(prenominal) as thou, sustain qualified and utility(a) get make give ofd oft in the construction industry, which make its pretty conf victimisation and difficult to tell if any one particular system or tangible fall under one or umteen of these heading. The report will help id entify, green utility(a) twist method and literals which are less(prenominal) damaging to the environment than a similar practice used in conventional lumber-framed construction. The need to find selection practices will encompass any building technique that can be done repeatedly without changing the environment in any noticeable way.The Importance of Finding alternative MaterialsAs the mankind population continues to grow at an alarming rate, people are realizing that pla terminate cannot sustain such continuous and exponential growth. With land being increasable limited and we are continually diminishing our natural resource such are timber, with majority of it being used to build homes. It is evident that we cannot continue to use our natural material at this rate to build our homes. With the awareness of these natural materials become increasing limited, has made the construction industry rethink their way and start to think more about sustainable construction. Using alte rnative material for 8building homes is much more environmental sustainable than conventional homes building. Depending on the type and amount of sustainable materials used, these types of alternative material can reduce the coulomb footprint which is produce in building homes.According to the orbwatch Institute, an independent organization that analyzes critical global issues, one-fourth of the worlds timberland and one-sixth of its fresh piss are usedin building construction. This situation will only become worse as the worlds population and more people continue to migrate toward cities. The greater demands also will add pressure on increasingly scarce essential resources, especially water.The EnvironmentThe environment has now become issues and with it being heightened news, the brasss and individuals have seem to take notice and now taking to make a change because we cannot continuing abusing the environment, this is not an woof anymore.The chart below shows the proportio n of CO2 emissions in the UK from buildings in use, the construction process (mainly due to the CO2 from the manufacture of building materials) and from all other sectors including industry, transport, floriculture etc. Buildings in use contri thate about half of our CO2 emissions (and consume about half of our ability use).Figure 1 CO2 emissionsThe succeeding(prenominal) chart shows where these emissions come from and with over half of our get-up-and-go use and CO2 emissions from building use come from heating our buildings.Figure two Energy Waste.Government ActionThe UK government have stated that England must take action now, in narrate to make vast make betterment to energy efficiency in both new and alive buildings. The government have set many ambitious terminuss, an example of one they anticipate dramatic energy reductions to achieve its goal that all new homes in England will be carbon-neutral by 2016. World Business Council for Sustainable Development (2007)There are three main approaches to energy neutralityCut buildings energy demand by, for example, using equipment that is more energy efficientProduce energy locally from renewable and otherwise lavishnessd energy resourcesShare energy create buildings that can generate surplus energy and feed it into an intelligent grid infrastructure.Efficiency gains in buildings are likely to go away the greatest energy reductions and in many cases will be the most economic option. A study by McKinsey estimated that demand reduction measures with no net address could roughly halve expected growth in global electricity demand. The Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment trace estimates that by 2020 CO2 emissions from building energy used can be reduced by 29% at no net cost World Business Council for Sustainable Development (2007) and a cost curve for greenhouse gas reduction, McKinsey Quarterly 2007 Number 1.Fox and Murrell (1989) state the fundamental ecology rule of renewable material, such as wood is sustainable source and are renewable however, for materials like metal, plastic, gravel and sand, stone-based materials such as cement, concrete and plaster, have been used cannot be used again, their consumption if the world itself. (Berge, 1992) The extraction of certain raw material can be precise destructive effects especially to the water table and wildlife habitats. Over usage of these materials can affect the availabilities of in the near future, cause environmental degradation, and contribute to global affectionateing.Impact of the ConstructionThe industry has a major impact on the environment, it affect are not only on the resources it consumes but also the elope it produces. The construction industry is accountable for producing a whole variety of different wastes, the amount and type of which depends on factors such as the stage of construction, type of construction work and practices on site. In gigantic Britain, over 90% of non-en ergy minerals is extracted and are used to supply the construction industry with materials. Furthermore, every year more than 70 million tonnes of construction and demolition waste has been produced in England and WalesThe key is alternative radical materials because they have historically driven innovation in every industry, and could spur significant advances in todays housing. In order to gain acceptance, however, basic alternative materials must offer more benefits than the traditional materials or methods they replace. They must reduce costs, increase design flexibility, enhance sustainability, per traffic pattern eightfold functions, have superior performance characteristics, or meet a market niche. Another potential driver for adopting alternative basic materials is a shortage of existing natural materials or concerns about their gigantic-term sustainability. Martn(2005) states that in recent years, there has been a shortages of nerve center natural resources including l umber, steel, and gypsum, and this has driven construction costs higher. This irritability of supply and price motivates the industry to look for more sustainable solutions. Sustainability and resource shortages, in fact, will help to drive innovations in the future.The objective of alternative basic materials is to develop new materials that spur innovation by serving multiple functions, increasing cost- efficaciousness and efficiency, and using more sustainable materials. In many cases, these technologies form building systems that enable other Concept Home principles such as integrated functions, floor plan flexibility, and improved production processes.Alternative basic materials consist of core technologies that manufacturers can use to create products or systems and composite systems that builders can purchase and use to build homes. Martn(2005)Before considering the use of alternative materials, and before implementing into homes, matter-of-fact issues must be considered, (B erge, 1992) say to be realistic to imagine a technology that functions in line holistic ideas, none-mainstream approach but also providing human being with an acceptable material standard of living, basically Berge is trying to say there sound be a balance between the Eco approach and what consumer want.Government Schemes and principleAfter The Stern Review (2006) which advised that the implications of climate change couldnt be avoided any longer and urgent action was required, the government took notice and started implementing changes to building regulations. In 2007, the Government introduced theCode for Sustainable Homesto help improve the energy efficiency and sustainability of houses, by setting target for all new houses to achieve a carbon rate of zero by 2016. This is a take aim 6 in the Code for Sustainable.Currently, the standards of the code are not mandatory for private house builders but there are intentions to incorporate them into theBuilding Regulations over the next couple years, starting with changes to Part L in 2010.CAN I ADD moreConstructing environmental friendly houseTo construct an environmental friendly houses are to focus on reducing the environmental impact of both itsconstructionand its on-goingoperation. This is achievable at the design phase by selecting the correct material and the process.Environmental friendly houses and sustainable construction offer an exciting future for building houses. With the prospect of living in an environmentally efficient house that can generate its own power. Also reducing waste and running costs, safe in the knowledge that your house is not effecting but instead helping the environment. This is a positive step for a sustainable future.It is well documented the impacts that human drill has had on our planet and with the Office for Climate Change 2010, attributing 27% of the UKs total carbon emissions to household heating and electricity, house construction is an area where we can make a huge difference.Ecological impactDuring the development and construction stages of house being built, a ecological assessment should be carried out that reduces its impact. Also the see if it is feasible to create new habitats in the form of green or living roofs.MaterialsHouses are constructed using a vast flow of products and materials from a hunt of sources. For each one the industry must need to considerThe sustainability of the raw materials used.The lifespan of the material.Its performance characteristics as part of the building fabric.The energy use and waste generated fromThe acquisition of raw materials.Processing.Transportation.Manufacture.The possibility for re-use or recyclability at the end of life.the-self-build-guide.co.uk(2009)Luckily, a lot of the legwork has been done for you on this one, with resources such as the BREs Green Guide, which tolerates environmental ratings for building materials and components.Material specific organisations like the Forest Stewardship Council (FSC) only certify timber taken from responsibly managed sources.You can find suppliers who use environmental management systems (EMS) to maximise the environmental efficiency of their businesses. EMS accreditation can be awarded through British Standards (BS) and the International Organisation for Standardisation (ISO).Alternative building systems improve on standard brick construction through their use of high performance materials and accurate construction techniques. Although many alternative systems involve the construction of buildings in-situ, in the same way that brick buildings are built, there are also many that are turning to off-site construction techniques to improve accuracy.Another benefit of off-site constructionAlternative Natural Construction Building SystemsAlternative building systems improve on standard brick construction through their use of high performance materials and accurate construction techniques. Although many alternative systems involve the c onstruction of buildings in-situ, in the same way that brick buildings are built, there are also many that are turning to off-site construction techniques to improve accuracy.Another benefit of off-site construction is that it can drastically reduce waste by up to 90% over traditional building methods. begrime brick flub brick is a building material, which consists of clay-loam soil puddle with water, sometimes breaking straw. The ideal soil requires clay content and the straw can be added to reduce drying and cracking. However, almost any soil can be adapted to make mud bricks making it one of the most flexible and convenient building methods. It is most popular due to its simplicity, which is advantageously grasped by the layperson with limited experience, time or resources. If the design and construction are easily, the building will last indefinitely.http//static.panoramio.com/photos/original/11435929.jpgMud brick has several advantages over conventional fired clay or concre te masonry. The advantages includeLow in embodied energyUtilisation of natural resources and token(prenominal) use of manufactured productsGood sound absorption characteristicsHigh thermal massA claimed ability to breathSuited to a wide range of soilsEasily manufactured and workedFlexibility in design/colour/surface finishesInsulation properties similar to those of concrete or brickworkThe disadvantagesMud brick building is very jade intensiveTexts and magazines suggest it is possible to make 100 bricks per day per person, although that level of productivity comes with experience and fitness Thousands of bricks are required for most dwellings.Only two or three courses of bricks can be laid at one time, because the courses need to dry out before more are added on top, to continue the wall slumping or warping.The technique requires a lot of water, which can be a problem in dry areas.Although it is possible to make bricks in arch weather, a large undercover area is needed.Mud brick building is very labour intensive and quite tiring (the most exhausting part is commingle the soil and water).(BBC h2g2, 2003)TimberWood is a very low carbon and sustainable material, it is important that the wood is ethically sourced and treated. There are types of wooden construction systems, they aretimber framing which is constructed completely on-siteStructural Insulated Panels ( imbibe)- they are manufactured off-site and assemble on-site.Timber framing is a cost effective method of construction which is available , they can be used for buildings up to around seven stories high and can be highly insulated level 4 or 5 of the Code for Sustainable Homes should be achievable.The drawbacks of timber farming are that construction time to build the walls to the specification at the suppliers. With the possibilities of dry chemic decomposition reaction or wood worm if the timber is not treated properly in the first place. Which mean that only certified companies can be used.SIP s, this method usages large sheets of plywood or chipboard (more or less) to sandwich to domiciliate a stern insulting core, with these structurally sound panels then joined unitedly to construct the building. SIPs are more expensive, are slightly less flexible in the buildings they produce, but are generally extremely well insulated and airtight level 6 of the Code for Sustainable Homes is achievable.The drawback of wood-clad panels is that they do not provide any thermal mass as part of their composition. Frechette (2009) http//www.greenhomebuilding.com/sip.htm, stats that when SIP it will burn, it has been demonstrated that they bear on structurally sound for a lengthy period during a fire and do not emit fumes any more hazardous than those of wood products. Another possible concern is with insects or rodents nesting in the insularity since this can be an ideal habitat for them. One last concern is that a well-constructed SIP structure is practically hermetically sealed, whic h means that thewalls are not breathable for this reason they require some sort of mechanical ventilation system for healthful habitation. straw bale Constructionhttp//hurricanecandice.files.wordpress.com/2009/04/straw-bale-home-1.jpgBrian Waite from straw bale house design states that the UK alone produces 4 million tons of surplus straw every year enough for 250,000 homes. stalking must have the lowest embodied energy of any building material and is probably the cheapest and most sustainable. Straw-bales have an insulation U tax much better than required by the building regulations aswell as excellent sound deadening properties which, together, give a living station an ambience that has to be experienced to be appreciated.Contrary to common perception straw-bales in a building, is not a fire risk, is not a varmint risk and are not short-term, but would compost back into the earth if and when required to do so. Straw in bales is so tightly bound that it doesnt contain enough a ir to support combustion, just add a (carbon neutral) breathing lime render/plaster and any fire regulation requirement is easily met. There is no nutritional value in straw and so it does not attract varmint, it is only voids that vermin like, so proper attention to occurrence is the only precaution needed. Lime rendered straw-bales breath so evening out fluctuations of humidity thereby creating a healthier environment.Straw bale construction is the use of compressed blocks (bales) of straw, either as fill for a wall cavity (non-load bearing) or as a structural component of a wall (load bearing.) In each case, the interior and exterior sides of the bale wall are covered (by stucco, plaster, clay, or another treatment.)The drawback of straw is that it requires special measures must be taken to provide nailing surfaces, since straw bales do not hold nails as well as wood and anchored to the knowledgeabilitys. The external weatherproof cladding will need to be good, as bales will r ot badly if they get damp If straw bales are not available within a few hundred miles of your construction site, the cost of shipping them, along with the potential pollution from the transportation, must be taken into account.Views of the industry Straw bales may be plastered inside and out to provide thermal mass and, like standard construction, the walls must be protected from moistureStraw bale can be more resistant to termites and vermin than stick construction, but (as with any type of construction), elimination of cracks and holes is keyRammed Earthhttp//cdn.webecoist.com/wp-content/uploads/2009/01/rammed-earth-home.jpgRammed earth walls (aka pies) are constructed by the compacting (ramming) of moistened subsoil into place between temporary formwork panels. When dried, the result is a dense, hard monolithic wall.Rammed earth is an ancient form of construction, usually associated with arid areas. There remain plentiful examples of the form around the world endorse that ramme d earth is a successful and durable way of building. A few historical rammed earth buildings are to be found in the UK.Rammed earth construction is once again gaining in popularity for home builders looking for eco-friendly options. With rammed earth, youre using the dirt under your feet (or from a local quarry) to build a house. This is certainly a green practice since it usually makes use of local materials (local dirt) and you dont need lumber, quarried stone, brick, etc. to be transported from long distances.Rammed earth construction has its pros and cons of course. Lets take a look at the positives and negatives.A properly sited and intentional rammed earth home is ideal for passive solar strategies, so it can be great for an off-the-grid house. The thick, dense walls absorb the heating system from the sun all day and slowly release the heat into the interior of the house at night. This helps keep heating bills low in the winter, and these homes tend to lenify cool in the su mmer as well.Dirt is an easy-to-acquire material and while there are some requirements (not all dirt is going to have the pay mix of sand and clay), you ought to be able to get it locally, so this tends to be an eco-friendly building material.Soil selection needs to be done carefully, and if you are able to use dirt from the building site, youll end up with some big holes you need to figure out how to work into the landscape. Though it might seem that a house made out of dirt would be cheap, rammed earth construction actually tends to cost 5 to 15% more than conventional construction (due to the effortful process of creating the rammed earth forms).Its difficult to impossible to create rounded or sculpturally shaped walls the way you can with other materials. Homes made with rammed earth construction are going to be boxy in nature.Constructing a rammed earth house in the UK would probably require extra insulation, (its typical to add foam insulation to exterior walls and then cove r it up with stucco) as rammed earth method is not suitable for colder climates cobnuthttp//www.ranchomastatal.com/images/PicsTim100405009.jpgAnother mud-hut style of building, but there are occupied cob houses around the UK that are anything up to 500 years old. non bad for a mud hut. filbert houses are built from a mixture of earth, clay, sand and straw. The ingredients are mixed together with a little water until they form a paste-like substance. The paste is then smoochped onto a stone foundation to form walls that are often around two foot thick, then more and more slapped on to form a monolithic structural building. The slap is usually built up in layers about 18 inches high to avoid slumping.The great thing about cob houses is that they can be built into more or less any shape you care to dream up curves, vaults, domes etc. This can result in some pretty offensive buildings. The drawback is that it is very labour intensive and the walls can take up to a year to fully set.C ob is a Cheap, sustainable and eco-friendly method of construction using local materials. This is as load-bearing method of construction and needs no framework. A cob house uses 60 per cent less timber than a stud frame building. a cob house typically uses 20 per cent less energy.Cob house are naturally energy-efficient to cool and heat, provided the builder takes care to insulate the ceiling, and attend to solar positioning advantages. Straw bales embedded into north walls make this truer. Heat tends to pass out through north cladding walls. Straw bales tend to keep this heat in, better that only earth, which is more porous for air passage.Contractor do not like working with Cob material as it is time consuming and labour-intensive. It makes the need for community obvious, while demonstrating our inherent unified power. Cob has to breathe to dry out naturally after becoming wet. It used to be that the exterior walls were either left bare or lime rendered (which is expensive these days). Excessive moisture can give you a probleme, as the material needs some moisture (3-5% is considered good much higher than that and you might have rising damp). Cob generally exceeds the minimum u-values for a house.Cost benefits compared belowBuilding systemCost (/m2)*BenefitsDrawbacksTraditional brick block800-1500Well known, flexible, popular, robust, durable.Materials not eco-friendly, high waste, often poor performance.Timber framing200-1000Sustainable, cheap, reasonably rapid, well known, good performance. measly image, needs good planning.SIP300-1300Sustainable, excellent performance, rapid, can be fairly cheap.Poorly understood, few contractors, inflexible, needs good planning.Straw bale80-1000Very sustainable, good performance, can be very cheap.Misunderstood and could have low sale value, limited lifespan, needs very good planning.Rammed earth500-1500***Very sustainable, durable, good performance.Misunderstood and could have low sale value, needs insulating, eas ily water damaged, long build time.Cob500-1500***Very sustainable, durable, good performance, very flexible.Misunderstood, needs insulating, easily water damaged, long build time.Traditional MaterialTraditional Building Method and Materials usedThe majority of new homes in England and Wales are built usingtraditional masonry construction. With most people in the construction industry are familiar with this method. This method has many advantages, such as a deep historical and psychological attachment to masonry construction, which has contributes to its persistence use as the main house building method in the UK. A national surveil by MORI found that 61% of respondents would prefer to buy a newly built property of traditional block construction.Most building systems in England and Wales use a timber frame for the skeleton of the house , this is the core of most traditional method of construction, however manufacturing developments have moved many of these methods into the categoriz ation of modern methods of construction discussed below. This is currently second most popular technique for new home construction in the UK and, according to the UK Timber Frame Association, is the fastest suppuration method of construction in the UK. Traditionally used in North America and Scandinavia, as those areas are rich in timber resources, it comes with some good environmental credentials.http//www.ajbuilding.co.uk/userimages/parsonagefarm3.jpgBefore considering what type of alternative method or material to use, we need to understand how current building methods and materials are being used. Below is a basic methodOnce the excavation and installation of the foundations is completed, the bricklayers erect cavity walls that consist of an inner and outer skin.The inner skin is the main structural particle, which supports internecine floors and the roof structure. It is constructed using concrete blocks laid on beds of sand and cement mortar.The outer skin of the house is t he first line of defence against the elements and provides the aesthetic element to the structure. This is constructed usually with brick, stone or block work, this can produces a number of finishes. The two skins are connected by steel wall ties and separated by a cavity that is partially or fully filled with insulation.Internal floors, they are constructed using timber joists, composite timber beams, or one of many precast concrete systems which are available. The roof is usually traditional cut timber or prefabricated truss construction.Traditional MaterialConcreteWith environment and health issues, concrete are non-toxic stains and sealants can be used. They are Manufacturer of Portland cement contributes between 5-8% of carbon dioxide emissions and greenhouse gases, which means concrete is non-green material. It under goes a chemical process of limestone, it creates the same amount of carbon dioxide in weight, but concrete can be grounded and recycled for use in roads and pavem ents (Holistic Interior Designs,2007)Concrete is often used in the construction and constructing home and is there a need to find an alternative material to replace concrete. Traditional concrete contains material such as stone or other material with similar properties. Concrete is made from gravel, sand, cement and water through a chemical process, the concrete is next, poured into slabs for worktops and panels creating a stone like appearance. The traditional use for concrete are use walls, floors, fireplace surrounds, worktops, panels, wall finishes, concrete furniture, sinks and basins. It offers an exceptionally high lifespan up to 3 times that of alternate building materialsThe use of concrete has many advantages, Farrell (2009) summaries the advantages and disadvantages of concrete which are stated belowAdvantagesFire, moisture, insect, rot and rust resistant,Can be poured into form Absorbs and retains heat very well,Concrete is water resistant and will not warp, rust or ro t.Concrete homes are less affected by fill up or by leaks from tanks or water pipes. Concrete walls between adjoining properties offer high levels of security and peace of mind to property owners.DisadvantagesWhich are Poor insulation propertiesConcrete May Not Offer Pleasant AestheticEmbodied Energy of concrete manufacture creates very high levels of carbon emission. product line Extraction of the raw materials in very large quantities has a negative impact on the local surrounding environments.Transportation of raw materials over long distances accounts for further release of carbon dioxide levels into the atmosphereBricksThere are now more environmentally friendly alternatives to traditional concrete on the market, made with haltere or carbon neutral concrete. Traditional concrete should be the last choice. Which will be explain later chapter.Are Bricks Green or Not?(Proefrock, 2007) asks what is brick made of, which is just clay and water and that is it, there are no complex c hemicals, no exotic compounds, no imported components. Brick are effectively just a manufactured clay stone with a special shape. It breaks down into earth since it comes from earth. (Proefrock, 2007) Clay mining is comparatively benign, compared to ore mining for metals, which requires far more material to be extracted and processed to produce the finished product. Clay is not a resource that is in short supply, which makes it a more attractive material to use, as well. The main reason brick is not an even greener building material is that it takes a lot of energy to make a brick. However, the extra energy is relative. (Proefrock, 2007)Finding alternative Insulationsustainablebuild.co.uk (2010) state insulation is a key component of sustainable building design. A well insulated home reduces energy bills by keeping warm in the winter and cools in the summer, and this in turn cuts down carbon emissions linked to global climate change.In regard to energy efficiency, investing in high levels of insulation materials when constructing houses is a cost-effective method of saving energy, rather than investing in expensive heating technologies. It is important to choose the correct type materials in the context of whole building design.Insulation materials are used in roofs, walls and floors. Alternative methods that have solid walls structures from cob and adobe cannot be insulated, Cob and Adobe already offers good thermal mass to compensate. Houses that construction with Timber frame require wall insulation in the form of batts (pre-cut sections that are designed to fit between stud walls), rolls or boards. Other types of construction methods such as brick or concrete insulate with spray foam, loose fill or rolls.Insulation materials work by resisting heat flow, measured by an R-value (the higher the R-value, the greater the insulation). This R-value varies according to material type, density and thickness, and is affected by thermal bridging, unclaimed heat flo

Dividend Payout Decision Making Process

Dividend Pay knocked out(p) Decision Making ProcessCHAPTER ONE cosmosBackgroundDividend form _or_ system of rules of government is an authorized component of the corpo evaluate fiscal management form _or_ system of government. It is a policy utilize by the hard to decide as to how a good deal immediate stipendment it should reinvest in its business through expansion or sh be repurchases and how a lot to settle out to its sh atomic number 18holders in dividends. Dividend is a catch up withment or revert do by the incorruptible to the bundleholders, (owners of the company) out of its pay in the form of specie. For a persistent time, the subject of corporate dividend policy has captivated the interests of umteen academicians and enquiryers, resulting in the emergence of a number of theoretical explanations for dividend policy. For the investors, dividend serve as an principal(prenominal) indicator of the saturation and emerging prosperity of the business, thereb y companies try to keep abreast a stable dividend because if they reduce their dividend allowances, investors may suspect that the company is facing a bullion take to the woods line of work. Investors like steady growth of dividends every category and are reluctant to enthronization to companies with fluctuating dividend policy. Over time, there has been a substantial increase in the number of actors identified in the literature as universe important to be considered in making dividend ratiocinations. Thus, protracted studies lose been done to predominate out various factors affecting dividend payout ratio of a regular. However, there is no single explanation that hind end capture the puzzling reality of corporate dividend behavior. Ocean pro institutely judgment is involved by decision makers to resolve this ex range of dividend behavior. The decision of companies to retain or pay out the recompense in form of dividends is important for the maximization of the o rder of the crocked (Oyejide, 1976). on that pointfore, companies should set a structural target dividend payout ratio, where it pays dividends to its shareholders and at the same time importanttains sufficient retained profits as to deflect having effect funds by borrowing money.A toilsome challenge was faced by financial practitioners and legion(predicate) academics, when Miller and Modigliani (MM) (1961) came with a proposition that, apt(p) perfect capital markets, the dividend decision does non affect the firm value and is, therefore, irrelevant. This proposition was greeted with surp bone up because at that time it was universally acknowledged by both(prenominal) theorists and corporate coachs that the firm gutter enhance its business value by providing for a more than(prenominal) generous dividend policy and that a properly managed dividend policy had an repair on share prices and shareholder wealth. Since the MM excogitate, many another(prenominal) researche rs consume relaxed the assumption of perfect capital markets and state theories closely how managers should formulate dividend policy decisions.Problem storyDividend policy has attracted a substantial sum total of research by many researchers and theorists, who guide provided theoretical as well as verifiable observations, into the dividend puzzle ( down in the mouth, 1976). unconstipated though researchers and theorists have extended their studies in context to dividend decisions, the import as to why corporations distri exclusivelye a portion of their earnings as dividends is not in time resolved. The issue of dividend policy has stimulated much debate among financial analysts since Lintners (1956) seminal work. He measured major alternates in earnings as the cite determining(prenominal) of the companies dividend decisions. There are many factors that affect dividend decisions of a firm as it is very difficult to lay down an optimum dividend policy which would maximi ze the long-term wealth of the shareholders resulting into increase or decrease of the firms value, but the original indicator of the firms capacity to pay dividends has been Profits.Miller and Modigliani (1961), DeAngelo and DeAngelo (2006) gave their proposition on the dividend irrelevancy, but the argument made by them was on assumptions that werent practical and in fact, the dividend payout decision does affect the shareholders value.The plain focuses on identifying various clinchers of dividend payout and whether these factors influence the dividend payout decision.Research ObjectiveThere are many theories in the corporate finance literature addressing the dividend issue. The purpose of poll is to escort the factors influencing the dividend decision of companies. The specific objectives of this reading areTo analyze the financials of the company, to draw a poser of factors much(prenominal) as Retained earnings, Age of the company, Debt to Equity, Cash, Net income, s hekels per share etc. amenable for dividend declaration.To understand the criticality of a companys profit top executive (in terms of lolly per share) component in declaration of dividends.To measure each factor individually on how it affects the dividend decision.Research QuestionsRQ1. What is the apprisal betwixt dividend payout and firms debt?RQ2. What is the relation in the midst of dividend payout and Profitability?RQ3. What is the relation betwixt dividend payout and liquidity?RQ4. What is the relation between dividend payout and Retained sugar?RQ5. What is the relation between dividend payout and Net Income?Contribution of the StudyDividend decision is an important financial decision made by firms, managers, and investors. This write up aims to contribute to the corporate finance literature, by looking at the Dividend puzzle. An attempt is made to make a valuable persona in two major bearingsTheoretical and verifiable approach is interpreted to provide a comprehensi ve view on the subject.The empirical flack taken in this view impart alone definitely leave some promising future ideas.The empirical findings and conclusions contained in this reputation can be used by financial managers to inform dividend decisions.Limitations of StudyThe areas of concern to analyze in this study are extensive. Due to the Time constraint and accessibility of data, the research leave behind be limited to the followingThe result of study is totally three years 2006 to 2008.The research has considered only those firms who pay dividends.The study is focused only on firms trading on the New York dribble Ex kind.Structure of the typographyThe remaining chapters get out be organized as followsChapter Two Literature ReviewThis chapter discusses the contrasting theories laid down in context to dividend policy and explains the alliance between dividend payout and its determinants as cerebrate by the study of various researchers and theorists.Chapter Three Re search methodologyThis chapter explains the research shot and gives a descriptive study of the techniques and the imitate used for data analysis. The application of the statistical tests used are explained thoroughly.Chapter four Data synopsis and FindingsTo address the research questions, results obtained from the retroflection analysis will be evaluated and discussed in this chapter.Chapter five Recommendations and Conclusion.This chapter Concludes the entire study and provides recommendations based on the findings and analysis done in the previous chapter and recommendations for future research.CHAPTER TWOLITERATURE REVIEWDividend clay one of the greatest enigmas of modern finance. Corporate dividend policy is an important decision area in the field of financial management hence there is an extensive literature devoted to the subject. Dividends are defined as the distribution of earnings (present or past) in real assets among the shareholders of the firm in proportion to th eir ownership. Dividend policy refers to managements long-term decision on how to utilize exchange menstruums from business activities-that is, how much to plow tush into the business, and how much to return to shareholders (Khan and Jain, 2005).Lintner (1956) conducted a notable study on dividend distributions, his was the premier(prenominal) empirical study of dividend policy through his interview with managers of 28 selected companies, he tell that just about companies have clear cut target payout ratios and that managers concern themselves with change in the existing dividend payout preferably than the amount of the newly established payout. He also states that, Dividend policy is set first and other(a) policies are then set and the market reacts arbitraryly to dividend increase declarations and shunly to announcements of dividend decreases. He measured major changes in earnings as the key determinant of the companies dividend decisions. Lintners study was expanded by Farrelly et al. (1988), who, mailed a questionnaire to 562 firms listed on the New York Stock Exchange and concluded that managers accept dividend policy to be relevant and important. Lintners view was also supported by the study results of Fama and Babiak (1968) and Fama (1974) who suggested that managers prefer a stable dividend policy, and are hesitant to increase dividends to a aim that cannot be supported. Fama and Babiaks (1968) study also concludes that Net income appears to explain the dividend change decision better than a interchange menstruation measure.The study by Adaoglu (2000), Amidu and Abor (2006) and Belans et al (2007) tell that net income plants validating and significant association with the dividend payout, therefore indicating that, the firms with the positive earnings pay more dividends.Merton Miller and Franco Modigliani (1961) made a proposition that the value of a firm is not bear upon by its dividend policy. Dividend policy is a way of dividing up operating cash in flows among investors or just a financial decision. fiscal theorists Martin, Petty, Keown, and Scott, 1991 supported this hypothesis of irrelevance. Miller and Modiglianis conclusion on the irrelevance of dividend policy presented a tough challenge to the conventional wisdom of time up to that point, it was universally acknowledged by both theorists and corporate managers that the firm can enhance its business value by providing for a more generous dividend policy as investors seem to prefer dividends over capital gains (JM Samuels, FM.Wilkes and R.E Brayshaw).Benartzi et al. (1997) conducted an extensive study and concluded that Lintners model of dividends remains the finest description of the dividend setting process available. Baker et al. (2001) conducted a valuate on 630 NASDAQ-listed firms and analyzed the responses from 188 CFOs about the importance of 22 disparate factors that influence their dividend policy, they raise that the dividend decisions m ade by managers were consistent with Lintners (1956) survey results and model. Their results also suggest that managers pay particular circumspection to the dividend policy of the firm because the dividend decision can affect firm value and, in turn, the wealth of farm animalholders, gum olibanum dividend policy requires serious attention by the management.E.F Fama and K.R french (2001) investigated the characteristics of companies paying dividends and concluded that the top around characteristics that affect the decision to pay dividends are Firm size, Profitability, and Investment opportunities. They studied dividend payment in the United States and found that the proportion of dividend payers declined sharply from 66% in 1978 to 20.8% in 1999, and that only about a fifth of public companies salaried dividends. Growth companies such as Microsoft, Cisco and Sun Microsystems were found to be non-dividend payers. They also explained that the probability that a firm would pay di vidends was positively related to profitability and size and negatively related to growth. Their research concluded that larger firms are more profitable and are more likely to pay dividends, than firms with more enthronement opportunities. The relationship between firm size and dividend policy was studied by Jennifer J. Gaver and Kenneth M. Gaver (1993). They suggested that A firms dividend yield is inversely related to the consummation of its growth opportunities. The inference here is that as cash flow increases, the coefficient of dividend decreases, indicating that smaller firms that have greater investment opportunities thus they tend not to make dividend payment while larger firms tend to have proactive dividends policy.Ho, H. (2003) undertook a comparative study of dividend policies in Japan and Australia. Their study revealed that dividend policies in Australia and Japan are affected by different financial factors. Dividend policies are affected positively by size in Aust ralia and liquidity in Japan. Naceur et al (2006) examined the dividend policy of 48 firms listed on the Tunisian Stock Exchange during the expiration 1996-2002. His research indicated that highly profitable firms with more stable earnings could present larger free cash flows and thus paid larger dividends. Li and Lie (2006) inform that large and profitable firms are more likely to raise their dividends if the past dividend yield, debt ratio, cash ratio are low. A study was conducted by Norhayati Mohamed, Wee Shu Hui, Mormah Hj.Omar, and Rashidah Abdul Rahman on Malaysian companies over a 3 year period from 2003-2005. The sample was taken from the top 200 companies listed on the main board of Bursa Malaysia based on market capitalization as at 31December 2005. Their study concluded that bigger firms pay higher(prenominal) dividends.For the purpose of finding out how companies arrive at their dividend decisions, many researchers and theorists have proposed some(prenominal) divide nd theories. Gordon and Walter (1963) presented the Bird in Hand theory which suggested that to minimize risk the investors always prefer cash in hand rather than future promise of capital gain. This theory asserts that investors value dividends and high payout firms. As said by John D. joggleefeller (an American industrialist) The one thing that gives me contentment is to see my dividend overture in. For companies to communicate financial well-being and shareholder value the easiest way is to say the dividend check is in the mail. The bird-in-hand theory (a pre-Miller-Modigliani theory) asserts that dividends are valued differently to capital gains in a world of selective information asymmetry where due(p) to perplexity of future cash flow, investors will often tend to prefer dividends to retained earnings. As a result the value of the firm would be increased as a higher payout ratio will reduce the unavoidable rate of return (see, for lawsuit Gordon, 1959). This argument ha s not gatherd any strong empirical support. Dividends, paid by companies to shareholders from earnings, serve as an important indicator of the strength and future prosperity of the business. This explanation is known as signal scheme. Signaling is an employment factor for the relevance of dividends to the value of the firm. It is based on the idea of information asymmetry between managers and investors, where managers have private information about the firm that is not available to the distantrs. This theory is supported by models put forward by Miller and Rock (1985), Bhattacharya (1979), John and Williams (1985). They stated that dividends can be used as a signaling device to influence share price. The share price reacts favorably when an announcement of dividend increase is made. Few researchers found limited support for the signaling hypothesis (see Gonedes, 1978, Watts, 1973) and there are other researchers, who supported the hypothesis, for example, in Michaely, Nissim an d Ziv (2001), Pettit (1972) and Bali (2003).The revenue revenue-preference theory assumes that the market military rank of a firms stocks is increased when the dividend payout ratios is low which in turn lowers the required rate of return. Because of the relative revenue liability of dividends compared to capital gains, investors convey a large amount of before-tax risk adjusted return on stocks with higher dividend yields (Brennan, 1970). On one side studies by Lichtenberger and Ramaswamy (1979), Poterba and Summers, (1984), and Barclay (1987) have presented empirical evidence in support of the tax movement argument and on the other side Black and Scholes (1974), Miller and Scholes (1982), and Morgan and Thomas (1998) have either opposed such findings or provided completely different explanations. The study by Masulis and Trueman (1988) model dividend payments in form of cash as products of deferred dividend follows. Their model predicts that investors with differing tax lia bilities will not be uniform in their beau ideal firm dividend policy. As the tax liability on dividends increases (decreases), the dividend payment decreases (increases) while earnings reinvestment increases (decreases). harmonize to Farrar and Selwyn (1967), in a partial equilibrium framework, individual investors acquire the amount of personal and corporate leverage and also whether to receive corporate distributions as dividends or capital gains. Barclay (1987) has presented empirical evidence I support of the tax effect argument. Others, including Black and Scholes (1982), have opposed such findings or provided different explanations.Farrar and Selwyns model (1967) made an assumption that investors tend to increase their after tax income to the maximum. According to this model corporate earnings should be distributed by share repurchase rather than the use of dividends.Brennan (1970) has extended Farrar and Selwyns model into a general equilibrium framework. beneath this, th e expected usefulness of wealth as a system of barter is maximized. Despite being more robust both the models are similar as regards to their predictions. According to Auerbachs (1979) discrete-time, infinite-horizon model, the wealth of shareholders is maximized by the shareholders themselves and not by firm market value. If there does, infact, exist a difference between capital gains and dividends tax firm market value maximization is no longer determine by wealth maximization.He states that the continued undervaluation of corporate capital leads to dividend distributions.The clientele effects hypothesis is another related theory. According to this theory the investors may be attracted to the types of stocks that fall in with their consumption/savings preferences. That is, investors (or clienteles) in high tax brackets may prefer non-dividend or low-dividend paying stocks if dividend income is taxed at a higher rate than capital gains. Also, certain clienteles may be created with the presence of transaction damages. There are several empirical studies on the clientele effects hypothesis but the findings are mixed. Studies by Pettit (1977), Scholz (1992), and Dhaliwal, Erickson and Trezevant (1999) presented evidence consistent with the existence of clientele effects hypothesis whereas studies by Lewellen et al. (1978), Richardson, Sefcik and Thomason (1986), Abrutyn and Turner (1990), found weak or contrary evidence.There is an assumption that the managers do not always take steps which would lead to maximizing an investors wealth. This gives rise to another favorable argument for hefty dividend payouts which shifts the reinvestment decision back on the owners. The main hitch would be the agency conflict (conflict between the principal and the agent) arising as a result of separate ownership and control. and then, a manager is expected to move the surplus funds from the high retained earnings into projects which are not feasible. This would be mainly due to his ill intention or his in competency.Thus, generous dividend payouts increase a firms value as it reduces the managements access to free cash flows and hence, controlling the problem of over investment. There are many more agency theories explaining how dividends can increase the value of a firm. One of them was by Easterbrook (1984) he proposed that dividend payments reduce agency problems in contrast to the transaction cost theory which is of the view that dividend payments reduce the value as it forces to raise costly finances from outside sources. His idea is that if the dividends are not paid, there is a problem of collective action that tends to lead to hap-hazard management of the firm. So, dividend payouts and raising external finance would attract audile and regulatory measures by financial intermediaries like investment banks, various(prenominal) stock exchange regulators and the electric potential investors as well. All this monitoring would lead to considerable diminution of agency costs and appreciate the market value of the firm. Moreover, as defined by Jenson and Meckling (1976), Agency costs=monitoring costs+ bonding, costs+ residual tone ending i.e. sum of agency cost of equity and agency cost of debt. Hence, Easterbrook (1984) noted that dividend payments and raising new debt and its contract negotiations would reduce potential for wealth transfer.The realization for potential agency costs linked with separation of management and shareholders is not new. Adam Smith (1937) proposed that management of earlier companies is wayward. This problem was highly witnessed during at the time of British East Indian Companies and tracking managers was a failure due to inefficiencies and high costs of shareholder monitoring (Kindleberger, 1984). Scott (1912) and Carlos (1922) differ with this view point. They agree that although some drool existed in the corporations, many of the activities of the managers were in line with those of the sharehol ders interests.An opportune and dexterous manager should always invest the surplus cash available into those opportunities which are well researched to be in the best interest of the shareholders. Berle and Means (1932) was the first to listen the insufficient utilization of funds which are surplus after other investment opportunities taken by the management. This thought was further promoted by Jensens (1986) free cash flow hypothesis. This hypothesis combined market information asymmetries with the agency theory. The surplus funds left(p) after all the valuable projects are largely responsible for creation of the conflict of interest between the management and the shareholders. Payment of dividends and interest on other debt instruments reduce the cash flow with the management to invest in marginal net present value projects and for other perquisite consumptions. Therefore, the dividend theory is better explained by the combination of both the agency and the signaling theory ra ther than by any one of these alone. On the other hand, the free cash flow hypothesis rationalizes the corporate takeover frenzy of the 1980s Myers (1987 and 1990) rather than providing a clear and comprehensive dividend policy.The study by Baker et al. (2007) reports, that firms paying dividend in Canada are importantly larger and more profitable, having greater cash flows, ownership twist and some growth opportunities. The cash flow hypothesis proposes that insiders to a firm have more information about future cash flow than the outsiders, and they have incentivized motives to leak this to outsiders. Lang and Litzenberger (1989) check the cash flow signaling and free cash flow explanations of the effect of dividend declarations on the stock prices. This difference between permanent and acting(prenominal) changes is also explored in Brook, Charlton, and Hendershott (1998). However, this study is based on the hypothesis that dividend changes contain cash flow information rather th an information about earnings. This is the cash flow signaling hypothesis proposing that dividend changes signal expected cash flows changes.The dividend decisions are affected by a number of factors many researchers have contributed in determining which determinant of dividend payout is the most significant in contributing to dividend decisions. It is said that the primary indicator of the firms capacity to pay dividends has been Profits. According to Lintner (1956) the dividend payment pattern of a firm is influenced by the current year earnings and previous year dividends. Pruitt and Gitmans (1991) survey of financial managers of 1000 largest U.S companies about the interplay among the investment and dividend decisions in their firms reported that, current and past year profits are essential factors influencing dividend payments. The conclusion derived from Baker and Powells (2000) survey of NYSE-listed firms is that the major determinant is the evaluate level of future earnings and continuity of past dividends. The study of Aivazian, Booth, and Cleary (2003) concludes that profitability and return on equity positively correlate with the size of the dividend payout ratio. The study by Lv Chang-jiang and Wang Ke-min (1999) on 316 listed companies in China that paid cash dividends during 1997 and 1998 by using modified Lintner dividend model, suggested that the dividend payout ratio is due to the firms current earning level. Other researchers like subgenus Chen Guo-Hui and Zhao Chun-guang (2000), Liu Shu-lian and Hu Yan-hong (2003) also concluded their research on the above stated understanding about dividend policy of listed companies in China.A survey done by Baker, Farrelly, and Edelman (1985) and Farrelly, Baker, and Edelman (1986) on 562 New York Stock Exchange (NYSE) firms with normal kinds of dividend polices in 1983 suggested that the major determinants of dividend payments were the anticipated level of future earnings and the pattern of past dividen ds.DeAngelo et al. (2004) findings suggest that earnings do have some impact on dividend payment. He stated that the high/increasing dividend concentration may be the result of high/increasing earnings concentration. Goergen et al. (2005) study on 221 German firms shows that net earnings were the key determinants of dividend changes. Baker and Smith (2006) examined 309 sample firms exhibiting behavior consistent with a residual dividend policy and their matched counterparts to understand how they set their dividend policies. Their study showed that for the matched firms, the pattern of past dividends and desire to maintain a long-term dividend payout ratio elicit the highest level of agreement from respondents. The study by Ferris et al. (2006) found mixed results for the relation between a firms earnings and its ability to pay dividends. Kao and Wu (1994) used a time series regression analysis of 454 firms over the period of 1965 to1986, and showed that there was a positive relatio nship between upset(prenominal) dividends and earnings. Carroll (1995) used quarterly data of 854 firms over the period of 1975 to 1984, and examined whether quarterly dividend changes predicted future earnings. He found a significant positive relationship.Liquidity is also an important determinant of dividend payouts. A pitiful liquidity position would generate fewer dividends due to deficit of cash. Alli et.al (1993), reveal that dividend payments depend more on cash flows, which polish the companys ability to pay dividends, than on current earnings, which are less heavily influenced by bill practices. They claim current earnings do no genuinely reflect the firms ability to pay dividends. A firm without the cash flow back up cannot choose to have a high dividend payout as it will ultimately have to either reduce its investment plans or turn to investors for additional debt. The study by Brook, Charlton and Hendershott (1998) states that, Firms expecting large permanent cash flow increases tend to increase their dividend.Managers do not increase dividends until they are positive that sufficient cash will flow in to pay them (Brealey-Myers-2002). Myers and Bacons (2001) study shows a negative relationship between the liquid ratio and dividend payout.For companies to enable them to enhance their dividend paying capacity, and thus, to generate higher dividend paying capacity, it is necessary to retain their earnings to finance investment in fixed assets. The study by Belans et al (2007) states that the relationship between the firms liquidity and dividend is positive which explains that firms with more market liquidity pay more dividends. Reddy (2006), Amidu and Abor (2006) find opposite evidence.Lintner (1956) posited that the level of retained earnings is a dividend decision by- product. Adaoglu (2000) study shows that the firms listed on Istanbul Stock Exchange follow unstable cash dividend policy and the main factor for determining the amount of divide nd is earning of the firms. The same conclusion was drawn by Omet (2004) in carapace of firms listed on Amman Securities Market and he further states that the tax imposition on dividend does not have the significant impact on the dividend behavior of the listed firms. The study by Mick and Bacon (2003) concludes that future earnings are the most influential variable and that the past dividend patterns as well as current and expected levels are empirically relevant in explaining the dividend decision. Empirical support for Lintners findings, that dividends were and then a function of current and past profit levels and were negatively correlated with the change in gross sales was found by Darling (1957), Fama and Babiak (1968). Benchman and Raaballe (2007) discovered that the impulse to pay out dividends is positively correlated to retained earnings. Also, the study by Denis and Osobov (2006) states that retained earnings are a significant dividend characteristic for non- US firms including UK, German, and French firms.One of the motives for dividend policy decision is maintaining a moderate share price as poor stock price performance mostly conveys negative information about firms reputation. An empirical research took by Zhao Chun-guang and Zhang Xue-li et al (2001) on all A shares listed companies listed in Shenzhen and Shanghai Stock Exchange, states that the more cash dividends is paid when the stock prices are high. Chen Guo-Hui and Zhao Chun-guang (2000) undertook a research on all A shares listed before 1996 and paid dividend into share capital in 1997 as their sampling, and employed single-factor analysis, multifactor regression analysis to analyze the data. Their research showed a positive stock price reaction to the cash dividend, stock dividend policy.Myers and Bacon (2001) discussed that the debt to equity ratio was positively correlated to the dividend yield. Therefore firms with relatively more investment opportunities would tend to be more ge ared and vice versa (Ross, 2000). The study by Hu and Liu, (2005) declares that there is a positive correlation between the cash dividend the companies pay and their current earnings, and a inverse relationship between the debt to total assets and dividends. verdure et al. (1993) questioned the irrelevance argument and investigated the relationship between the dividends and investment and backing decisions. Their study showed that dividend payout levels are decided along with investment and financing decisions. The study results however do not support the views of Miller and Modigliani (1961). Partington (1983) declared that firms motives for paying dividends and extent to which dividends are decided are independent of investment policy. The study by Higgins (1981) declares a influence link between growths and financing needs, rapidly growing firms have external financing needs because working capital needs normally exceed the additive cash flows from new sales. Higgins (1972) su ggests that payout ratios are negatively related to firms need top fund finance growth opportunities. Other researchers like Rozeff (1982), Lloyd et al. (1985) and Collins et al. (1996) all show significantly negative relationship between historical sales growth and dividend payout whereas D, Souza (1999) however shows a positive but insignificant relationship in the gaffe of growth and negative but insignificant relationship in case of market to book value. Jenson and Meckling (1976) find a strong relationship between dividends and investment opportunities. They explain, in some circumstances where firms have relative jumpy disposableDividend Payout Decision Making ProcessDividend Payout Decision Making ProcessCHAPTER ONEINTRODUCTIONBackgroundDividend policy is an important component of the corporate financial management policy. It is a policy used by the firm to decide as to how much cash it should reinvest in its business through expansion or share repurchases and how much to p ay out to its shareholders in dividends. Dividend is a payment or return made by the firm to the shareholders, (owners of the company) out of its earnings in the form of cash. For a long time, the subject of corporate dividend policy has captivated the interests of many academicians and researchers, resulting in the emergence of a number of theoretical explanations for dividend policy. For the investors, dividend serve as an important indicator of the strength and future prosperity of the business, thereby companies try to maintain a stable dividend because if they reduce their dividend payments, investors may suspect that the company is facing a cash flow problem. Investors prefer steady growth of dividends every year and are reluctant to investment to companies with fluctuating dividend policy. Over time, there has been a substantial increase in the number of factors identified in the literature as being important to be considered in making dividend decisions. Thus, extensive stud ies have been done to find out various factors affecting dividend payout ratio of a firm. However, there is no single explanation that can capture the puzzling reality of corporate dividend behavior. Ocean deep judgment is involved by decision makers to resolve this issue of dividend behavior. The decision of companies to retain or pay out the earnings in form of dividends is important for the maximization of the value of the firm (Oyejide, 1976). Therefore, companies should set a constructive target dividend payout ratio, where it pays dividends to its shareholders and at the same time maintains sufficient retained earnings as to avoid having raise funds by borrowing money.A tough challenge was faced by financial practitioners and many academics, when Miller and Modigliani (MM) (1961) came with a proposition that, given perfect capital markets, the dividend decision does not affect the firm value and is, therefore, irrelevant. This proposition was greeted with surprise because at t hat time it was universally acknowledged by both theorists and corporate managers that the firm can enhance its business value by providing for a more generous dividend policy and that a properly managed dividend policy had an impact on share prices and shareholder wealth. Since the MM study, many researchers have relaxed the assumption of perfect capital markets and stated theories about how managers should formulate dividend policy decisions.Problem StatementDividend policy has attracted a substantial amount of research by many researchers and theorists, who have provided theoretical as well as empirical observations, into the dividend puzzle (Black, 1976). Even though researchers and theorists have extended their studies in context to dividend decisions, the issue as to why corporations distribute a portion of their earnings as dividends is not yet resolved. The issue of dividend policy has stimulated much debate among financial analysts since Lintners (1956) seminal work. He mea sured major changes in earnings as the key determinant of the companies dividend decisions. There are many factors that affect dividend decisions of a firm as it is very difficult to lay down an optimum dividend policy which would maximize the long-run wealth of the shareholders resulting into increase or decrease of the firms value, but the primary indicator of the firms capacity to pay dividends has been Profits.Miller and Modigliani (1961), DeAngelo and DeAngelo (2006) gave their proposition on the dividend irrelevance, but the argument made by them was on assumptions that werent practical and in fact, the dividend payout decision does affect the shareholders value.The study focuses on identifying various determinants of dividend payout and whether these factors influence the dividend payout decision.Research ObjectiveThere are many theories in the corporate finance literature addressing the dividend issue. The purpose of study is to understand the factors influencing the dividen d decision of companies. The specific objectives of this study areTo analyze the financials of the company, to draw a framework of factors such as Retained earnings, Age of the company, Debt to Equity, Cash, Net income, Earnings per share etc. responsible for dividend declaration.To understand the criticality of a companys profitability (in terms of Earnings per share) component in declaration of dividends.To measure each factor individually on how it affects the dividend decision.Research QuestionsRQ1. What is the relation between dividend payout and firms debt?RQ2. What is the relation between dividend payout and Profitability?RQ3. What is the relation between dividend payout and liquidity?RQ4. What is the relation between dividend payout and Retained Earnings?RQ5. What is the relation between dividend payout and Net Income?Contribution of the StudyDividend decision is an important financial decision made by firms, managers, and investors. This study aims to contribute to the corp orate finance literature, by looking at the Dividend puzzle. An attempt is made to make a valuable contribution in two major waysTheoretical and Empirical approach is taken to provide a comprehensive view on the subject.The empirical Approach taken in this study will definitely leave some promising future ideas.The empirical findings and conclusions contained in this study can be used by financial managers to inform dividend decisions.Limitations of StudyThe areas of concern to investigate in this study are extensive. Due to the Time constraint and accessibility of data, the research will be limited to the followingThe period of study is only three years 2006 to 2008.The research has considered only those firms who pay dividends.The study is focused only on firms trading on the New York Stock Exchange.Structure of the PaperThe remaining chapters will be organized as followsChapter Two Literature ReviewThis chapter discusses the different theories laid down in context to dividend pol icy and explains the relationship between dividend payout and its determinants as concluded by the study of different researchers and theorists.Chapter Three Research MethodologyThis chapter explains the research hypothesis and gives a descriptive study of the techniques and the model used for data analysis. The application of the statistical tests used are explained thoroughly.Chapter four Data Analysis and FindingsTo address the research questions, results obtained from the regression analysis will be evaluated and discussed in this chapter.Chapter five Recommendations and Conclusion.This chapter Concludes the entire study and provides recommendations based on the findings and analysis done in the previous chapter and recommendations for future research.CHAPTER TWOLITERATURE REVIEWDividend remains one of the greatest enigmas of modern finance. Corporate dividend policy is an important decision area in the field of financial management hence there is an extensive literature devoted to the subject. Dividends are defined as the distribution of earnings (present or past) in real assets among the shareholders of the firm in proportion to their ownership. Dividend policy refers to managements long-term decision on how to utilize cash flows from business activities-that is, how much to plow back into the business, and how much to return to shareholders (Khan and Jain, 2005).Lintner (1956) conducted a notable study on dividend distributions, his was the first empirical study of dividend policy through his interview with managers of 28 selected companies, he stated that most companies have clear cut target payout ratios and that managers concern themselves with change in the existing dividend payout rather than the amount of the newly established payout. He also states that, Dividend policy is set first and other policies are then adjusted and the market reacts positively to dividend increase announcements and negatively to announcements of dividend decreases. He mea sured major changes in earnings as the key determinant of the companies dividend decisions. Lintners study was expanded by Farrelly et al. (1988), who, mailed a questionnaire to 562 firms listed on the New York Stock Exchange and concluded that managers accept dividend policy to be relevant and important. Lintners view was also supported by the study results of Fama and Babiak (1968) and Fama (1974) who suggested that managers prefer a stable dividend policy, and are hesitant to increase dividends to a level that cannot be supported. Fama and Babiaks (1968) study also concludes that Net income appears to explain the dividend change decision better than a cash flow measure.The study by Adaoglu (2000), Amidu and Abor (2006) and Belans et al (2007) stated that net income shows positive and significant association with the dividend payout, therefore indicating that, the firms with the positive earnings pay more dividends.Merton Miller and Franco Modigliani (1961) made a proposition that the value of a firm is not affected by its dividend policy. Dividend policy is a way of dividing up operating cash flows among investors or just a financial decision. Financial theorists Martin, Petty, Keown, and Scott, 1991 supported this theory of irrelevance. Miller and Modiglianis conclusion on the irrelevance of dividend policy presented a tough challenge to the conventional wisdom of time up to that point, it was universally acknowledged by both theorists and corporate managers that the firm can enhance its business value by providing for a more generous dividend policy as investors seem to prefer dividends over capital gains (JM Samuels, FM.Wilkes and R.E Brayshaw).Benartzi et al. (1997) conducted an extensive study and concluded that Lintners model of dividends remains the finest description of the dividend setting process available. Baker et al. (2001) conducted a survey on 630 NASDAQ-listed firms and analyzed the responses from 188 CFOs about the importance of 22 differen t factors that influence their dividend policy, they found that the dividend decisions made by managers were consistent with Lintners (1956) survey results and model. Their results also suggest that managers pay particular attention to the dividend policy of the firm because the dividend decision can affect firm value and, in turn, the wealth of stockholders, thus dividend policy requires serious attention by the management.E.F Fama and K.R French (2001) investigated the characteristics of companies paying dividends and concluded that the top most characteristics that affect the decision to pay dividends are Firm size, Profitability, and Investment opportunities. They studied dividend payment in the United States and found that the proportion of dividend payers declined sharply from 66% in 1978 to 20.8% in 1999, and that only about a fifth of public companies paid dividends. Growth companies such as Microsoft, Cisco and Sun Microsystems were found to be non-dividend payers. They als o explained that the probability that a firm would pay dividends was positively related to profitability and size and negatively related to growth. Their research concluded that larger firms are more profitable and are more likely to pay dividends, than firms with more investment opportunities. The relationship between firm size and dividend policy was studied by Jennifer J. Gaver and Kenneth M. Gaver (1993). They suggested that A firms dividend yield is inversely related to the extent of its growth opportunities. The inference here is that as cash flow increases, the coefficient of dividend decreases, indicating that smaller firms that have greater investment opportunities thus they tend not to make dividend payment while larger firms tend to have proactive dividends policy.Ho, H. (2003) undertook a comparative study of dividend policies in Japan and Australia. Their study revealed that dividend policies in Australia and Japan are affected by different financial factors. Dividend p olicies are affected positively by size in Australia and liquidity in Japan. Naceur et al (2006) examined the dividend policy of 48 firms listed on the Tunisian Stock Exchange during the period 1996-2002. His research indicated that highly profitable firms with more stable earnings could afford larger free cash flows and thus paid larger dividends. Li and Lie (2006) reported that large and profitable firms are more likely to raise their dividends if the past dividend yield, debt ratio, cash ratio are low. A study was conducted by Norhayati Mohamed, Wee Shu Hui, Mormah Hj.Omar, and Rashidah Abdul Rahman on Malaysian companies over a 3 year period from 2003-2005. The sample was taken from the top 200 companies listed on the main board of Bursa Malaysia based on market capitalization as at 31December 2005. Their study concluded that bigger firms pay higher dividends.For the purpose of finding out how companies arrive at their dividend decisions, many researchers and theorists have prop osed several dividend theories. Gordon and Walter (1963) presented the Bird in Hand theory which suggested that to minimize risk the investors always prefer cash in hand rather than future promise of capital gain. This theory asserts that investors value dividends and high payout firms. As said by John D. Rockefeller (an American industrialist) The one thing that gives me contentment is to see my dividend coming in. For companies to communicate financial well-being and shareholder value the easiest way is to say the dividend check is in the mail. The bird-in-hand theory (a pre-Miller-Modigliani theory) asserts that dividends are valued differently to capital gains in a world of information asymmetry where due to uncertainty of future cash flow, investors will often tend to prefer dividends to retained earnings. As a result the value of the firm would be increased as a higher payout ratio will reduce the required rate of return (see, for example Gordon, 1959). This argument has not r eceived any strong empirical support. Dividends, paid by companies to shareholders from earnings, serve as an important indicator of the strength and future prosperity of the business. This explanation is known as signaling hypothesis. Signaling is an example factor for the relevance of dividends to the value of the firm. It is based on the idea of information asymmetry between managers and investors, where managers have private information about the firm that is not available to the outsiders. This theory is supported by models put forward by Miller and Rock (1985), Bhattacharya (1979), John and Williams (1985). They stated that dividends can be used as a signaling device to influence share price. The share price reacts favorably when an announcement of dividend increase is made. Few researchers found limited support for the signaling hypothesis (see Gonedes, 1978, Watts, 1973) and there are other researchers, who supported the hypothesis, for example, in Michaely, Nissim and Ziv ( 2001), Pettit (1972) and Bali (2003).The tax-preference theory assumes that the market valuation of a firms stocks is increased when the dividend payout ratios is low which in turn lowers the required rate of return. Because of the relative tax liability of dividends compared to capital gains, investors need a large amount of before-tax risk adjusted return on stocks with higher dividend yields (Brennan, 1970). On one side studies by Lichtenberger and Ramaswamy (1979), Poterba and Summers, (1984), and Barclay (1987) have presented empirical evidence in support of the tax effect argument and on the other side Black and Scholes (1974), Miller and Scholes (1982), and Morgan and Thomas (1998) have either opposed such findings or provided completely different explanations. The study by Masulis and Trueman (1988) model dividend payments in form of cash as products of deferred dividend costs. Their model predicts that investors with differing tax liabilities will not be uniform in their id eal firm dividend policy. As the tax liability on dividends increases (decreases), the dividend payment decreases (increases) while earnings reinvestment increases (decreases). According to Farrar and Selwyn (1967), in a partial equilibrium framework, individual investors choose the amount of personal and corporate leverage and also whether to receive corporate distributions as dividends or capital gains. Barclay (1987) has presented empirical evidence I support of the tax effect argument. Others, including Black and Scholes (1982), have opposed such findings or provided different explanations.Farrar and Selwyns model (1967) made an assumption that investors tend to increase their after tax income to the maximum. According to this model corporate earnings should be distributed by share repurchase rather than the use of dividends.Brennan (1970) has extended Farrar and Selwyns model into a general equilibrium framework. Under this, the expected usefulness of wealth as a system of bart er is maximized. Despite being more robust both the models are similar as regards to their predictions. According to Auerbachs (1979) discrete-time, infinite-horizon model, the wealth of shareholders is maximized by the shareholders themselves and not by firm market value. If there does, infact, exist a difference between capital gains and dividends tax firm market value maximization is no longer determined by wealth maximization.He states that the continued undervaluation of corporate capital leads to dividend distributions.The clientele effects hypothesis is another related theory. According to this theory the investors may be attracted to the types of stocks that fall in with their consumption/savings preferences. That is, investors (or clienteles) in high tax brackets may prefer non-dividend or low-dividend paying stocks if dividend income is taxed at a higher rate than capital gains. Also, certain clienteles may be created with the presence of transaction costs. There are sever al empirical studies on the clientele effects hypothesis but the findings are mixed. Studies by Pettit (1977), Scholz (1992), and Dhaliwal, Erickson and Trezevant (1999) presented evidence consistent with the existence of clientele effects hypothesis whereas studies by Lewellen et al. (1978), Richardson, Sefcik and Thomason (1986), Abrutyn and Turner (1990), found weak or contrary evidence.There is an assumption that the managers do not always take steps which would lead to maximizing an investors wealth. This gives rise to another favorable argument for hefty dividend payouts which shifts the reinvestment decision back on the owners. The main hitch would be the agency conflict (conflict between the principal and the agent) arising as a result of separate ownership and control. Therefore, a manager is expected to move the surplus funds from the high retained earnings into projects which are not feasible. This would be mainly due to his ill intention or his in competency.Thus, genero us dividend payouts increase a firms value as it reduces the managements access to free cash flows and hence, controlling the problem of over investment. There are many more agency theories explaining how dividends can increase the value of a firm. One of them was by Easterbrook (1984) he proposed that dividend payments reduce agency problems in contrast to the transaction cost theory which is of the view that dividend payments reduce the value as it forces to raise costly finances from outside sources. His idea is that if the dividends are not paid, there is a problem of collective action that tends to lead to hap-hazard management of the firm. So, dividend payouts and raising external finance would attract auditory and regulatory measures by financial intermediaries like investment banks, respective stock exchange regulators and the potential investors as well. All this monitoring would lead to considerable reduction of agency costs and appreciate the market value of the firm. Mor eover, as defined by Jenson and Meckling (1976), Agency costs=monitoring costs+ bonding, costs+ residual loss i.e. sum of agency cost of equity and agency cost of debt. Hence, Easterbrook (1984) noted that dividend payments and raising new debt and its contract negotiations would reduce potential for wealth transfer.The realization for potential agency costs linked with separation of management and shareholders is not new. Adam Smith (1937) proposed that management of earlier companies is wayward. This problem was highly witnessed during at the time of British East Indian Companies and tracking managers was a failure due to inefficiencies and high costs of shareholder monitoring (Kindleberger, 1984). Scott (1912) and Carlos (1922) differ with this view point. They agree that although some fraud existed in the corporations, many of the activities of the managers were in line with those of the shareholders interests.An opportune and intelligent manager should always invest the surplus cash available into those opportunities which are well researched to be in the best interest of the shareholders. Berle and Means (1932) was the first to discover the insufficient utilization of funds which are surplus after other investment opportunities taken by the management. This thought was further promoted by Jensens (1986) free cash flow hypothesis. This hypothesis combined market information asymmetries with the agency theory. The surplus funds left after all the valuable projects are largely responsible for creation of the conflict of interest between the management and the shareholders. Payment of dividends and interest on other debt instruments reduce the cash flow with the management to invest in marginal net present value projects and for other perquisite consumptions. Therefore, the dividend theory is better explained by the combination of both the agency and the signaling theory rather than by any one of these alone. On the other hand, the free cash flow hypothesis rationalizes the corporate takeover frenzy of the 1980s Myers (1987 and 1990) rather than providing a clear and comprehensive dividend policy.The study by Baker et al. (2007) reports, that firms paying dividend in Canada are significantly larger and more profitable, having greater cash flows, ownership structure and some growth opportunities. The cash flow hypothesis proposes that insiders to a firm have more information about future cash flow than the outsiders, and they have incentivized motives to leak this to outsiders. Lang and Litzenberger (1989) check the cash flow signaling and free cash flow explanations of the effect of dividend declarations on the stock prices. This difference between permanent and temporary changes is also explored in Brook, Charlton, and Hendershott (1998). However, this study is based on the hypothesis that dividend changes contain cash flow information rather than information about earnings. This is the cash flow signaling hypothesis proposing that di vidend changes signal expected cash flows changes.The dividend decisions are affected by a number of factors many researchers have contributed in determining which determinant of dividend payout is the most significant in contributing to dividend decisions. It is said that the primary indicator of the firms capacity to pay dividends has been Profits. According to Lintner (1956) the dividend payment pattern of a firm is influenced by the current year earnings and previous year dividends. Pruitt and Gitmans (1991) survey of financial managers of 1000 largest U.S companies about the interplay among the investment and dividend decisions in their firms reported that, current and past year profits are essential factors influencing dividend payments. The conclusion derived from Baker and Powells (2000) survey of NYSE-listed firms is that the major determinant is the anticipated level of future earnings and continuity of past dividends. The study of Aivazian, Booth, and Cleary (2003) conclu des that profitability and return on equity positively correlate with the size of the dividend payout ratio. The study by Lv Chang-jiang and Wang Ke-min (1999) on 316 listed companies in China that paid cash dividends during 1997 and 1998 by using modified Lintner dividend model, suggested that the dividend payout ratio is due to the firms current earning level. Other researchers like Chen Guo-Hui and Zhao Chun-guang (2000), Liu Shu-lian and Hu Yan-hong (2003) also concluded their research on the above stated understanding about dividend policy of listed companies in China.A survey done by Baker, Farrelly, and Edelman (1985) and Farrelly, Baker, and Edelman (1986) on 562 New York Stock Exchange (NYSE) firms with normal kinds of dividend polices in 1983 suggested that the major determinants of dividend payments were the anticipated level of future earnings and the pattern of past dividends.DeAngelo et al. (2004) findings suggest that earnings do have some impact on dividend payment. He stated that the high/increasing dividend concentration may be the result of high/increasing earnings concentration. Goergen et al. (2005) study on 221 German firms shows that net earnings were the key determinants of dividend changes. Baker and Smith (2006) examined 309 sample firms exhibiting behavior consistent with a residual dividend policy and their matched counterparts to understand how they set their dividend policies. Their study showed that for the matched firms, the pattern of past dividends and desire to maintain a long-term dividend payout ratio elicit the highest level of agreement from respondents. The study by Ferris et al. (2006) found mixed results for the relation between a firms earnings and its ability to pay dividends. Kao and Wu (1994) used a time series regression analysis of 454 firms over the period of 1965 to1986, and showed that there was a positive relationship between unexpected dividends and earnings. Carroll (1995) used quarterly data of 854 firms o ver the period of 1975 to 1984, and examined whether quarterly dividend changes predicted future earnings. He found a significant positive relationship.Liquidity is also an important determinant of dividend payouts. A poor liquidity position would generate fewer dividends due to shortage of cash. Alli et.al (1993), reveal that dividend payments depend more on cash flows, which reflect the companys ability to pay dividends, than on current earnings, which are less heavily influenced by accounting practices. They claim current earnings do no really reflect the firms ability to pay dividends. A firm without the cash flow back up cannot choose to have a high dividend payout as it will ultimately have to either reduce its investment plans or turn to investors for additional debt. The study by Brook, Charlton and Hendershott (1998) states that, Firms expecting large permanent cash flow increases tend to increase their dividend.Managers do not increase dividends until they are positive tha t sufficient cash will flow in to pay them (Brealey-Myers-2002). Myers and Bacons (2001) study shows a negative relationship between the liquid ratio and dividend payout.For companies to enable them to enhance their dividend paying capacity, and thus, to generate higher dividend paying capacity, it is necessary to retain their earnings to finance investment in fixed assets. The study by Belans et al (2007) states that the relationship between the firms liquidity and dividend is positive which explains that firms with more market liquidity pay more dividends. Reddy (2006), Amidu and Abor (2006) find opposite evidence.Lintner (1956) posited that the level of retained earnings is a dividend decision by- product. Adaoglu (2000) study shows that the firms listed on Istanbul Stock Exchange follow unstable cash dividend policy and the main factor for determining the amount of dividend is earning of the firms. The same conclusion was drawn by Omet (2004) in case of firms listed on Amman Sec urities Market and he further states that the tax imposition on dividend does not have the significant impact on the dividend behavior of the listed firms. The study by Mick and Bacon (2003) concludes that future earnings are the most influential variable and that the past dividend patterns as well as current and expected levels are empirically relevant in explaining the dividend decision. Empirical support for Lintners findings, that dividends were indeed a function of current and past profit levels and were negatively correlated with the change in sales was found by Darling (1957), Fama and Babiak (1968). Benchman and Raaballe (2007) discovered that the propensity to pay out dividends is positively correlated to retained earnings. Also, the study by Denis and Osobov (2006) states that retained earnings are a significant dividend characteristic for non- US firms including UK, German, and French firms.One of the motives for dividend policy decision is maintaining a moderate share pr ice as poor stock price performance mostly conveys negative information about firms reputation. An empirical research took by Zhao Chun-guang and Zhang Xue-li et al (2001) on all A shares listed companies listed in Shenzhen and Shanghai Stock Exchange, states that the more cash dividends is paid when the stock prices are high. Chen Guo-Hui and Zhao Chun-guang (2000) undertook a research on all A shares listed before 1996 and paid dividend into share capital in 1997 as their sampling, and employed single-factor analysis, multifactor regression analysis to analyze the data. Their research showed a positive stock price reaction to the cash dividend, stock dividend policy.Myers and Bacon (2001) discussed that the debt to equity ratio was positively correlated to the dividend yield. Therefore firms with relatively more investment opportunities would tend to be more geared and vice versa (Ross, 2000). The study by Hu and Liu, (2005) declares that there is a positive correlation between th e cash dividend the companies pay and their current earnings, and a inverse relationship between the debt to total assets and dividends.Green et al. (1993) questioned the irrelevance argument and investigated the relationship between the dividends and investment and financing decisions. Their study showed that dividend payout levels are decided along with investment and financing decisions. The study results however do not support the views of Miller and Modigliani (1961). Partington (1983) declared that firms motives for paying dividends and extent to which dividends are decided are independent of investment policy. The study by Higgins (1981) declares a direct link between growths and financing needs, rapidly growing firms have external financing needs because working capital needs normally exceed the incremental cash flows from new sales. Higgins (1972) suggests that payout ratios are negatively related to firms need top fund finance growth opportunities. Other researchers like R ozeff (1982), Lloyd et al. (1985) and Collins et al. (1996) all show significantly negative relationship between historical sales growth and dividend payout whereas D, Souza (1999) however shows a positive but insignificant relationship in the case of growth and negative but insignificant relationship in case of market to book value. Jenson and Meckling (1976) find a strong relationship between dividends and investment opportunities. They explain, in some circumstances where firms have relative uptight disposable

The Relationship between Psychology and Movies Essays -- Good Will Hunt

Movies are most of the time related to a human macrocosms tone. Movies apply psychological science to their plots. For example, movies like the StepMom directed by Chris Columbus, and Good Will Hunting directed by Gus Van Sant show us that psychology is part of our lives in a day to day base. It could go from a divorce to a person who is scared to take a step in life. The textbook, Psychology Core Concept, by Philip G. Zimbarbo, Ann L. Weber, and Robert L. Johnson, utilizes examples from these movies. We are going to see how these movies relate to the core principles of psychology.In Chapter four, we see how psychology starts all the way from the beginning of our lives. It shows how we as organisms change over time. We go from being a zygote to an embryo and then to a fetus. Then we go into behavior performance since we are innate(p) until we die. We start with little things like responding to sounds, recognizing our moms, moving from side to side, walking, talking, playing, and so forth. One big aspect of our life is learning to talk. We start out babbling, and then go into our one- word twain-word item, until we are able to learn grammar. Another aspect of our life is cognitive development. This is where our thinking changes. This theory comes from the Swiss psychologist Jean Piaget. We start out by assimilating information. We assimilate through out our lives. Then there are stages we go through from have got to adulthood. The first stage is the Sensorimotor Stage which is from birth to the age of two. In this stage, the child relies heavily on innate motor response to stimuli. (pg.133.) Then there is the stage call Preoperational Stage which is from the age of two to about seven years. In this stage we learn to use our language in a well developed mental representation. (pg134.) Then there is the stage from seven to eleven years this is call the Concrete Operational Stage. In this stage, is capable of understanding conversation but still is incapable of abstract opinion (pg.134.) The last stage is the Formal Operational Stage. This stage is from about 12 years and on. This stage is when our abstract thought appears. Then it continues to social and emotional development. This is where they child develops a theory of mind which is an awareness that other peoples behavior may be influenced by beliefs, desires, and emotions that differ from ones proclaim (pg. 137.) This makes up... ...his chapter. Matt Damon plays Will Hunting, a boy genius who was severely abused as a child and has been in trouble with the law ever since. He works as a janitor in a school. While working he sack ups an impossible mathematical problem on the blackboard. When the math professor, Lambeau, finds out that it was the janitor that solve the math problems he was amazed. This led him to go to Wills court hearing and get him to be release under his supervision. Will is in court for The court had him meet a therapist. He first sees a psychiatrist who did not help him. Then he had hypnosis that did not work either. Then he meets the therapist who was played by Robin Williams. Sean helps Will Hunting change his life. Both Will and Sean are haunted by the past. These led to Will believe in Sean and the therapy starts to work. Also their similarity of the meaning of the world. will live life with a wonderful philosophy that he could go through the rest of his life without having to really know anyone. Psychology is involved in all aspect of our lives. It answers many questions. Through movies like the ones mentioned above we are able to how psychology works.