Analysis of Nigerian Business Environment Essays

Analysis of Nigerian Business Environment Essays Analysis of Nigerian Business Environment Paper Analysis of Nigerian Business Environment Paper Essay Topic: Renewable energy The project concerns the investigation of the current renewable energy market entry and opportunities for Finnish mall and medium-sized enterprises (Seems) in the Nigerian economy. The goals is to support growth and accelerate the internationalization of small and medium-sized Finnish renewable energy companies within developing countries and to determine how they can achieve market entry in the renewable energy resource business in Nigeria. There is great demand for electricity in the country due to its high consumption, and this thesis will study the demand for renewable energy resources in Nigeria, identify the main competitors and discover the best periods for market entry in Nigeria. A qualitative method of analysis was used in this thesis project, and a questionnaire survey was sent to three energy organizations in Nigeria. These included the International Centre for Energy, Environment Development; the Energy Commission of Nigeria (ACNE); and the Council for Renewable Energy in Nigeria. The investigation of this thesis project provides information needed to establish renewable energy in rural and urban areas in Nigeria. The Nigerian government is encouraging energy companies to invest in the country and special energy policies for foreign investors have been organized, such as a ax reduction plan for energy investors, and the relaxing of energy policy. Nigeria is a nation with great potential for renewable energy solutions, such as sunlight which might be productive for solar power solution, and plentiful bio-waste for biomass energy production. The key research questions are as follows: Is it advisable for the Finnish renewable energy companies invest in Nigeria? What renewable energy sources have a better potential to be a growing and developing investment in Nigeria? 8 1. 2 Methodology The method used in thesis projects is qualitative research method, which can be refers as scientific researches that consist of investigation that collect evidence, produce findings that are undetermined in advance, need answers to a question, producing informations that are application beyond the immediate areas of study and use a predefined set of procedures to answer the question. It is also important for information collections to maintain clear boundaries between information they received by the participant and what they ask the participant. Furthermore, questionnaire was carefully prepared and directed to renewable energy Nos (International Centre for Energy, Environment Development and Council for Renewable Energy in Nigeria) and the Nigerian government organization called the Ministry of Energy. The questionnaire was vital for the aims and objectives of the thesis as part of the CONNECT project requirement. Majority of the questions asked were related to the PESTLES actors. The questionnaire format is related to questions based on suggestions, energy situation and government incentives and support in establishing a company in the Nigerian market. The questionnaires are based on their understanding of the energy situation, the availability of renewable energy resources, the level of energy competition companies in the country, the economic and environmental competitive, which were sent to them, via their email address and there was also a follow up by telephone in other to hastening them for responses. The investigation of this thesis project revives information needed to establish renewable energy in the rural and urban areas that are in need of energy in the country. Literature reviews is still part of the methodology used in the PESTLE analysis of the project where information are being gathered from different sources, documented, evaluated and presented. 1. 3 Key definition Renewable energy can be refers to as a natural energy at which its energy supply is limited. Renewable energy can never run and can be used again and again. Renewable energy has been in use for so many years in different ways. An example is how the primordial human used the application of wind for sailing; rather the same wind is now used for electricity generation in the modern era. 9 Some of the renewable energy resources are as follows. Wood, Biomass, Wind, Hydro, Wave, geothermal, tidal and solar. (Clean Energy Ideas, 201 2) 1. 4 Structure of the thesis Figure 1 Thesis structure The Introduction and Objectives of the thesis was described in chapter one. In chapter TV, PESTLE analysis of Nigeria has been examined. In chapter three, the energy market situation in general and rates Of demand and supply was analyzed. In chapter four, the renewable energy market demand, its vital resources have been concluded. In the chapter five, research method analysis was conducted via interview questions to different organizations related to renewable energy business. 2 The Business Operating environment in Nigeria (PESTLE Analysis) The PESTLE factors consist of the Political, Economic, Social, Technological, Environmental and Legal. It is a strategic technique that gives useful information for analyzing the environmental tension in a particular environment. For example, in this project, it means to analyze the Nigerian equines operating macro environment for renewable energy opportunities. 10 Figure 2: PESTLE analysis political Factors refers to changes in government impact, its priorities for the Nigerian relationships with other countries which closes or open the market bond between them which includes the forms of government, bureaucracy, international relationship, corruption, public ownership right and many more. Economy factors refers on how the economics of a particular place can affect business such as changes in wage rate, inflation, Economic stability, employment rate, labor force, division of income. Social Factors refers to changes in trends which include lifestyles, behavior, attitude, business culture, cultural changes, family change, demographics and expectations. Technological factors refers to as the level of technology in Nigeria which will helps with the introduction of renewable energy solution in the country which Includes, electricity, infrastructures and modern communications. Environmental factors includes geographical sites and locations, climatic changes, natural resources related to renewable energy solutions, level of infrastructures, Public opinion, cost implications and frequency of environmental catastrophe. 11 Legal factors includes the Nigerian rules and regulations related to energy, Cocoas and African union legislations and Nigeria directives 2. 1 Political factors 2. 1. Politics and Administration Nigeria is a republic nation which operates a Federal system of government, with three different authorities- The Federal, State and the Local government. The division of power is among the three arms of government. The Federal Government consist of the Judiciary which interprets the laws, for examples supreme court, court of appeal and the district court; the executive enforces ND carry out the laws, for example federal and the legislature makes the laws for example senate and house of representative. The state government consist of (36 States including the Federal Capital Territory Baja) some of the states in the northern Region consist of Kane, Sudan, Sotto, Born, Dammar, Catkins, Gumbo, Samara and others can be shown on the map. The western region consists of Lagos, Gun, Indo, Sun, Kite, Oho, Awkward etc. The states in the South and East consist of ABA, Belays, Delta, Umbra, Rivers Imo; Ensue (Teach anywhere 2009). Figure 3: Map of Nigeria 12 The Nigeria government consists of 774 local government areas (CIA 2012). The political terrain is becoming attractive to business in Nigeria since the country became a democratic system in the year 1999. For the past 13 years, Nigeria has been experiencing an uninterrupted democracy and the latest election was held from the month of April to June 2011 which was a democratic form of choosing a representative to the Nigerian government and its various States. Those elected on the federal level are the head of states (The President and Vice President) and legislature system which is (National Assembly). The Nigerian President is elected by the People via election voting system. The national assembly is a form of two chambers, House of Representatives with 360 seats and the Senate which has 109 seats and all are elected for a four years term each. The political terrain is becoming positive except for the northern region of Nigeria that is experiencing instability due to religions unrest, security operatives are deployed to the region in other to neutralized the situation and the government have begun in negotiating with the religious crisis cabals (BOOK HARM) in the northern region in other to address the annoyance of he group which will improve the business day to day in the region. The southern region of Nigeria is very suitable for businesses day to day which control the economy power of the country. 2. 1. 2 Government Policy The government policy in Nigeria varies in different situations, for example changes in government regime every four years. According to the Industry analysis in Nigeria, government policies usually have a great impact.

Free Essays on Aids In Africa

AIDS in Zimbabwe Africa is dying. Once the cradle of civilization, the African continent is now ravaged by AIDS, and an entire generation is threatened with extinction. In Zimbabwe, an estimated 20 to 25 percent of adults are infected with AIDS and an increasing number of children, many already orphaned by the disease, are infected too. Those who have escaped AIDS so far face an uncertain future in a country where knowledge and culture are dying along with the people. Zimbabwe struggles against Aids onslaught The disaster in Zimbabwe is far worse than anyone expected By Evan Davis, BBC television's Newsnight economics correspondent, in Zimbabwe I thought I already knew all I needed to about the impact of HIV and AIDS in Africa. Watch the Newsnight report by Evan Davis Certainly I knew it was a human catastrophe, that the virus was running through populations on a scale unknown in the West, in an area of the world ill-equipped to cope. But it was only when a British businessman with extensive experience in Zimbabwe described to me some of the practical effects the illness is having on society there, that I decided I should find out more. Living in the shadow of Aids Zimbabwe now has the dubious honour of being the world's most infected country - about a quarter of the adult population is HIV positive. In many urban areas, infection runs to 40%. In the army, it is more like 80%. Life expectancy at birth, on one estimate, is poised to fall to 38 years. The country suffers from having an economy advanced enough for the virus to spread, in particular, on relatively good roads - epidemiologists have tracked high HIV prevalence along the main freight routes. Alas, the economy may be strong enough to help HIV, but it is not strong enough to fight it. Zimbabweans cannot get modern anti-retroviral drug combinations because in Zimbabwe, the annual health budget is about  £5.50 per person, enough t... Free Essays on Aids In Africa Free Essays on Aids In Africa AIDS in Zimbabwe Africa is dying. Once the cradle of civilization, the African continent is now ravaged by AIDS, and an entire generation is threatened with extinction. In Zimbabwe, an estimated 20 to 25 percent of adults are infected with AIDS and an increasing number of children, many already orphaned by the disease, are infected too. Those who have escaped AIDS so far face an uncertain future in a country where knowledge and culture are dying along with the people. Zimbabwe struggles against Aids onslaught The disaster in Zimbabwe is far worse than anyone expected By Evan Davis, BBC television's Newsnight economics correspondent, in Zimbabwe I thought I already knew all I needed to about the impact of HIV and AIDS in Africa. Watch the Newsnight report by Evan Davis Certainly I knew it was a human catastrophe, that the virus was running through populations on a scale unknown in the West, in an area of the world ill-equipped to cope. But it was only when a British businessman with extensive experience in Zimbabwe described to me some of the practical effects the illness is having on society there, that I decided I should find out more. Living in the shadow of Aids Zimbabwe now has the dubious honour of being the world's most infected country - about a quarter of the adult population is HIV positive. In many urban areas, infection runs to 40%. In the army, it is more like 80%. Life expectancy at birth, on one estimate, is poised to fall to 38 years. The country suffers from having an economy advanced enough for the virus to spread, in particular, on relatively good roads - epidemiologists have tracked high HIV prevalence along the main freight routes. Alas, the economy may be strong enough to help HIV, but it is not strong enough to fight it. Zimbabweans cannot get modern anti-retroviral drug combinations because in Zimbabwe, the annual health budget is about  £5.50 per person, enough t... Free Essays on Aids In Africa As recently as 1990, there were some regions of the world that had remained relatively unscathed by AIDS. Today, however, there is not a single country around the world which has wholly escaped the AIDS epidemic. As the epidemic has matured, some of the developed nations which were hard hit by the epidemic in the 1980s such as the United States have reported a slowing in the rate of new infections and a stabilization among existing cases with lower mortality rates and an extension of post-diagnosis lifespan. However, despite the changing face of the global AIDS pandemic, one factor remains unchanged: no region of the world bears a higher AIDS-related burden than sub-Saharan Africa. This paper examines the demographic effects of AIDS in Africa, focusing on the hardest-hit countries of sub-Saharan Africa and considers the present and future impact of the AIDS epidemic on major demographic measures such as fertility, mortality, life expectancy, gender, age, and family structure. Althoug h the sub-Saharan region accounts for just 10% of the world’s population, 67% (22.5 million) of the 33.4 million people living with HIV/AIDS in 1998 were residents of one of the 34 countries of sub-Saharan Africa, and of all AIDS deaths since the epidemic started, 83% have occurred in sub-Saharan Africa (Gilks, 1999, p. 180). Among children under age 15 living with HIV/AIDS, 90% live in sub-Saharan Africa as do 95% of all AIDS orphans. In several of the 34 sub-Saharan nations, 1 out of every 4 adults is HIV-positive (UNAIDS, 1998, p. 1). Taxing low-income countries with health care systems inadequate to handle the burden of non-AIDS related illnesses, AIDS has devastated many of the sub-Saharan African economies. The impact of AIDS on the region is such that it is now affecting demographics - changing mortality and fertility rates, reducing lifespan, and ultimately affecting population growth. Although Africa is the region of the world hardest hit by AIDS,...

Are non-executive directors capable of fulfilling the role given to Essay

Are non-executive directors capable of fulfilling the role given to them in the UK Corporate Governance Code - Essay Example On executive directors do not give the same continuous attention to the business of the day of a company but should however show similar commitment as the executive directors (Council, 2010). The functions of the executive directors are well spelt out as they are aimed at providing an independent view about the company which differs from the day to day insights and activities. As part of the board of a specific company non executive directors should manage to bring: independence in their view of how the operations are run in the company, impartiality, wide experience in the activities a company undertakes and personal qualities that will add positive value in the company. The key responsibilities of non executive directors generally depend on the direction of the company and therefore the board seeks their opinion on issues such as: strategic direction-as an outsider they are considered to have a better objective view of the issues affecting the company than executives .In strategy formation they are constructive critics who provide a creative and informed contribution in managerial decisions. Monitoring of the performance of key executives is also an essential role they undertake and therefore address concerns as they arise. They are take part in auditor ensure the accounts are properly put in place. As non executives they should be able to ask any questions of any financial structures that have been put forward by the management (Council, 2010). The governance code of the UK which is related to corporate is a set of standards of good practice in relation to board of director’s leadership and effectiveness, remuneration, degree of accountability and its relations to the shareholders. The UK corporate governance code is divided into main principles and supporting principles that help in advancing its provisions. Leadership is

Marketing Case Study Example | Topics and Well Written Essays - 500 words - 4

Marketing - Case Study Example Several brands have registered success in the social media usage. Currently, social media usage must be employed to meet the younger generation. Marketing of products using online tools has increased sales volume because the clients employ online purchase of items. Apart from employing the online tools, social media have a massive impact on the success of the country both in business and politics. The Arab revolution is a product of social media usage in the airing of the grievances of the citizens. Facebook is the leading social media platform with massive subscribers and increased success in terms of usage. Facebook as a social media tool enjoys massive support from the youths who have employed it in communication and information transfer. Companies use social media marketing strategy to improve brand image and resonance (Beverly and Thomson 123). Marketing involves the employment of all the necessary platforms of promotion and advertising with the SNSs offering a better platform for communication. Social media platforms offer the opportunity for collection of feedback. Traditionally, feedback collection of products released in the market was hard to obtain owing to the nature of information sharing systems. However, with the introduction of social media platform companies are able to prepare the market for the introduction of new product, while also collecting the customer preferences about the product. The success of products in the current society has been pegged on the marketing plan and action employed by the company (Beverly and Thomson 145). Public relations use social media to improve product perception and facilitate the development of positivity towards the company. Social media can be employed both in communication and persuasive advertising with enormous success. Facebook, MySpace and Twitter, are some of the widely used social media platforms

Medical Law & Ethics Essay Example | Topics and Well Written Essays - 750 words

Medical Law & Ethics - Essay Example There are proponents of a universal healthcare insurance plan for all Americans. In this policy, everyone will be entitled to government-controlled health insurance regardless of their financial background (WHO, 2010). I believe that everyone in the US is entitled to equal rights and this includes equal access to medical services. This means that no one should be turned away from a hospital just because they are not properly insured, or because their insurance is not enough to cover medical expenses. Yet there are over 50 million American citizens who cannot afford basic health insurance (Bardes, Shelley and Schmidt, 2008). It is true that not all Americans are well endowed in terms of material wealth. Therefore there are many out there who cannot afford health insurance. I think the introduction of a universal system of health insurance would help lessen the burden of medical costs for many people in America who deserve the same medical care as those who have the means of paying hefty health insurance cover money. I do not think that there is anyone out there who is wiling to part with his or her hard earned cash paying for someone else’s health insurance. However, if this universal health insurance is adopted, someone has to bear the cost. It is a known fact, however, that the money needed for an ambitious project such as a universal healthcare plan will come from the Americans themselves (Bardes, Shelley and Schmidt, 2008). I do not think that this is as bad as people think it is. In any case, this is a classic case of Americans helping their fellow Americans. In my opinion the government is doing a great job in pushing for a universal health insurance system. I believe that the federal government is very capable of running a well organized health insurance system for all Americans. It is about time we started thinking about out fellow Americans who cannot

Significance of Capital Market for Economic Development

Significance of Capital Market for Economic Development An Explotary Study On The Significance of Capital Market for Economic Development and Its Further Growth Potential In Context of Bangladesh Abstract This research paper investigates whether the role of capital market is significant for the economic development of Bangladesh. Literature suggests that well developed stock market can provide an extra impetus to economic activity. Similar conclusions were also drawn from the in-depth interviews. This paper also reveals a well-scanned scenario of the capital market highlighting its setbacks, current weakness, recent improvements and its prospective signs of development through which we can foresee whether the capital market has further growth potential or not. Thus the present study can also contribute in providing essential information that can also be used for further research. Abbreviations ADB- Asian Development Bank CDBL- Central Depository of Bangladesh Limited CDS- Central Depository System CSE- Chittagong Stock Exchange DGEN- DSE general index DSE- Dhaka Stock Exchange GDP- gross domestic product IPO- initial public offering SEC- Security and Exchange Commission 1.0 Introduction The financial market contributes to the economic growth and development by providing the needed finance for provision of goods and services. The financial market consists of two division- money market and capital market. The money market is basically entitled to supply finance on short-term basis to individuals, businesses, enterprises, government and their agencies. The capital market, on the other hand, provides finance on medium to long-term basis to corporate bodies, government and their agencies (Al-Faki, 2006). Capital Market plays a crucial role in any modern economy as they allow investors’ fund to flow to the most promising opportunities, i.e., the funds are mobilized and channeled efficiently from savers to the users of funds (Al-Faki, 2006; DSE, 2006; Hubbard and Thornton, 2006; Ahmed, 1997). In Bangladesh financial intermediation relies mostly on the banking sector which further resulted in lack of equity financing (Salahuddin Ahmed, 2007; Islam and Hassan 2002). Furthermore out of 5 million urban-based middle class people only four hundred thousand are participating in the securities market and among them roughly hundred thousand are active investors. A large portion is still ignorant of the nature and benefits of the capital market (Abu Ahmed, 2006; DSE Review, 2006; Islam and Hassan, 2002). Developing more complete and deeper capital market would enhance a countries growth potential and innovation (Andritzky, 2007). The forces of globalization, technology, new forms of competition have noticeably transformed capital market worldwide (Hassan, 2004). The chief advisor Dr. Fakhruddin Ahmed stated that â€Å"Only a vibrant and well-regulated capital market can bring sustainable economic development in the country through making the real sector capable of meeting the challenges of the competitive global economic realities† ( DSE Monthly Review, June 2007). Regardless of recent improvements, Bangladesh’s capital market remains underdeveloped as its size is still very small in terms of market cap (ADB, 2006; Salahuddin Ahmed, 2007; Islam and Hassan 2002). The market cap represents just above 9% of the GDP (Dr. Fakhruddin Ahmed retrieved from DSE Review). As Bangladesh capital market is still quite small compared to other regional market and to the size of its economy (CSE, 2006) despite its existence for a long time, this paper applies a framework for analyzing the significance of capital market for economic growth and development of Bangladesh, identifying its growth potentials through exploration. 2.0 Problem Statement Bangladesh’s capital market is still underdeveloped, in spite of recent improvements. The size of the country’s capital market is quite small mainly due to the excessive dependence of leading corporate entities on the banks for financing. Moreover the overall transparency of market transaction is also low compared to international standards and generally there has been slow development of the underlying market infrastructure. The government is making effort to develop the reliability and efficiency of stock exchanges as investment market. Compared to the other neighboring countries the numbers of participants are much smaller in Bangladesh as investor lack confidence. There is a supply side constrains in the capital market as quality shares are lacking. For all this reason this research is done to explore the importance of capital market in the economy and what are the prospective sign of development of the stock market. 3.0 Purpose of the Study The purpose of the study is to explore a well scanned scenario of Bangladesh capital market, its significance and its prospects. Although some research has been conducted relating to this topic but there is little empirical evidence about how essential stock market is to economic development of a country. A sound capital market prompts better economic base and influence its future growth and so it can help realize Bangladesh’s growth potential. The capital market of Bangladesh is on the brink to play its due role as a medium for financing investment and thereby making a notable contribution to economic growth, employment creation and poverty alleviation. The capital market plays an important role in quickening the pace of economic development but the existing state of the capital market is under-developed and not in a position to ensure economic progress of the country. Hence this research will try to highlight the significance of capital market for the nation and explore what are the probable signs of progress. 4.0 Research Timeline 2007 SeptemberWriting Research Proposal 2007 SeptemberDeveloping Literature Review 2007 OctoberCollecting Data 2007 October- NovemberData Analysis and Interpretation of the Findings 2007 NovemberPreparing Draft and Finalizing the Research Paper 2007 DecemberSubmission of Research Paper 5.0 Limitations of the study During conducting the research I came across certain limitations and among them the foremost one is time constrain. Although I got the opportunity to work in an organization that is capital market based but it was difficult to find spare time that could be used for the report. Moreover the interviewed person could not provide all necessary information due to lack of time. The research timeline also reveals that time constrain was actually a barrier as there was plenty to find about this research topic. As the research is conducted for the first time, I did not get much support from previous research paper and further research is suggested. A huge portion of the report is based on secondary data collected through websites and so the depth of reliability varies as by the nature of website. 6.0 Review of the Literature 6.1 Financial Intermediation According to Joseph Yam (2004) financial intermediation is channeling savings into investments. Aziz and Duenwald (2002) referred that financial intermediation affects growth through the following channels – (i) it can increase the marginal productivity of capital by collecting information to evaluate alternative investment projects and by risk sharing (ii) it can raise the proportion of savings channeled to investment through financial development. According to Conning and Kevane (2002) â€Å"intermediation implies an intermediary†. Gorton and Winton (2002) added that â€Å"it is the root institution in the saving investment process†. They referred that financial intermediaries are firms that borrow from those who have excess money, that is, the savers and lend the money to companies that need resources for investment. 6.2 Performance Indicators According to R. N. Agarwal (2000) the most commonly used standard to measure the size of a country’s stock market is market capitalization ratio, that is, the ratio of market value of stocks which are currently listed on a bourse to Gross Domestic Product (GDP). A small ratio of capitalization to GDP reveals the small size of a stock market. Alternatively, the size can be measured by the number of listed companies on a stock market. The height of maturity of an economy’s financial system is essential for economic development. Bekeart et al., (2007), Hubard and Thornton (2006), Rosul (2002) all investigated the significance and relation of stock market development with the economic growth and their conclusion suggests that capital market development is positively correlated with long term economic growth and the capital market plays an important role in the economic development of any country. The size of the equity capital market has an optimistic effect on economic growth of the country, that is, much higher market cap and turnover has a major positive influence on the economy (Institute for Advanced Studies, IHS, 2006). It is seen that the ratio of market cap to GDP in neighboring countries like India, Pakistan and Sri Lanka is relatively much higher, that is, more than 60% of their GDP (DSE, Kh. Asadul Islam, 2007; Dr. Fakhruddin Ahmed,2007). In Bangladesh the market cap is very small proportion of the countries GDP (Islam Hassan, 2002) and this is due to significant dependence on the banking sector (DSE Review, Fakhruddin Ahmed, June 2007). Market capitalization as a share of GDP was around 2.5%-3.3% during 2001-2003 compared with 1.4-10.1% during 1993-1996 and 2- 4% during 1997-2000. However in the year 2004 market cap reached 6.8% reflecting the rise in the DSE index from 968 to 1,971 at the end of 2003 and 2004 respectively (ADB, May 2005). The trend of market cap as percentage of GDP and other capital market indicators of DSE and CSE are shown through the help of statistical data represented in the discussion section in Table 1. Despite the existence of the bourse from 1954, the capital market still exhibits features of an emerging equity market (Islam Hassan, 2002). The finance sector is immensely bank-based (Salahuddin Ahmed, 2007) as resource mobilization for industrialization and economic development is made primarily through the regular banking system (Islam Hassan, 2002). Borrowing requires fixed payments and over-reliance on banks can cause credit default risk. According to (Mochammad Rosul, 2002) excessive reliance on bank borrowing results in a mismatch with long-term investments being financed with short-term bank loans. He added that such a risky situation can further contribute to the economic crisis and so the job of the principal fund supplier for business should be transferred from banking sector to the capital sector. 6.3 Regulatory Bodies 6.3.1. The Security and Exchange Commission (SEC) The Security and Exchange Commission (SEC) exercises power under the Security and Exchange Commission Act 1993 and established on June 8, 1993. SEC, the sole Capital Market Watchdog and Regulator, has been pursuing a vigorous capital market development process including amendments of its existing regulations, conduction of investor awareness programs, rigid monitoring and surveillance to bring in transparency in the trading mechanism (SEC, Annual Report 2003 -04). The responsibility of SEC includes the following: Regulating the functions of Stock Exchanges Registering and regulating the business of stock brokers, sub broker, share transfer agents, underwriters, registrar, portfolio managers, investment advisors, and other middlemen related to security dealings. Registering, controlling, and monitoring of all types of mutual funds Controlling and monitoring of all authorized self regulatory organizations Prohibiting fraudulent and unfair practices related to securities Promoting investor’s education program and providing training of intermediaries Regulating substantial acquisition of shares and takeover of companies SEC are detects market manipulation and also keeps constant vigil on the activities of stock exchanges to ensure effectiveness of the surveillance system. Conducts research and publishes information for above purposes (Source: Security Exchange Commission Website: www.secbd.com) 6.3.2 Stock Exchanges 6.3.2.1 Dhaka Stock Exchange (DSE) On April 28, 1954 DSE was first incorporated as the East Pakistan Stock Exchange Association Limited. Formal trading began in 1956 with 196 securities listed on the DSE with a total paid up capital of about Taka 4 billion. On June 23, 1962 it was renamed as Dhaka Stock Exchange (DSE) Limited. After 1971, the trading activities of the prime bourse remained suppresses until 1976 due to liberation war and economic policy pursued by the then government. Trading resumed at DSE in 1976 with only 9 companies listed having a paid up of Taka 137.52 million (Bashar et al., 2000; M Farid Ahmed, 1997). As of today there are 342 listed companies in the prime bourse with market cap exceeding 700,000 million (DSE, 2007). The reforms that DSE undertook recently for ensuring professionalism and transparency focused on the trading of securities. The measure were taken to implement transparent trading system, efficient reporting of trade, real time delivery of information, strong surveillance and monitoring over trade of securities and settlement of shares (Rahman,Uddin and Malik, 2006). 6.3.2.2 The Chittagong Stock Exchange Limited (CSE) The CSE is the countries second bourse that started its operation from the year 1995. It is also a self-regulatory non profit organization. Currently the numbers of listed securities are 223 of which the number of listed companies are 208, mutual funds 14, and one debenture. 6.4 Recent Capital Market Scenario of Bangladesh According to Dr Fakhruddin Ahmed (DSE, 2007) political uncertainty, corruption and lack of transparency in all section of the social and economic fabric are some of the reasons for capital market deficiency. Bangladesh Governor Salehuddin Ahmed (2007) reveals that foremost problems include political instability, under developed infrastructure, poor port management, short comings in legal system and corruption (Financial Express Report). On the other hand DSE general share price index reached its pinnacle and crossed 3000 points (Newage: www.newagebd.com). In fact the capital market witnessed a robust growth in the current year. Both turnover and market cap crossed new milestones at Tk 3000 million and Tk 700,000 million respectively during the year (DSE, 2006; DSE, 2007, IDLCSL). Recently our market cap crossed USD 10 billion that accounts for only 13% of its GDP which was only 8% a year back. (DSE Monthly Review, Oct 2007). Though the contribution of capital market to GDP is still inadequate when compared to neighboring countries but still its increase is significant for the development of our economy. Comparison of indices and market cap among different countries is shown in Table 2 and Figure 2 in the discussion part. Entry of 12 new issues worth Tk 11,322.95 million helped raise the market cap. Some of the reason for the progress in capital market development is central depository system and the automated trading system (ADB, 2006; SEC, 2005). The DSE has upgraded its automated online trading system and investors are able to trade from different parts of the country (SEC Quarterly Report, April-June 2007; ADB, 2006). Another reason for the vigorous improvement of the equity capital market is due to strenuous efforts taken by the SEC that further boosted investors’ confidence (DSE, 2007). 7.0 Research Methodology 7.1 Research Design The present study endeavored to explore importance of capital market for the economic development of Bangladesh and its future prospects. Exploratory research is selected as research design as little information exists about the capital market of Bangladesh. The aim of exploratory research is mainly to gain enough information before doing more thorough research. We basically start by gathering as much information about the object as possible and with a vague impression of what we should study (Cooper Schindler, 2003). 7.2 Research Instrument The research was conducted using both primary and secondary data. For collecting secondary data, various books, websites, newspapers, annual reports, monthly reviews and significant articles were chosen. Also for collection of primary data in-depth interviews with a range of designated professional, related to this field, were taken. 7.3 Data Collection Secondary data used in the paper has been collected through access of different source of books, journals, publications of DSE, SEC, ADB and other news paper and articles. The DSE and SEC library were visited to acquire secondary information. Various websites were browsed to collect relevant articles that are circulated on online sites. For collecting primary data, in-depth interviews of experienced people related to this field of capital market were taken. Appointments were fixed initially and then the interviews were taken. The interviewed persons are Kh. Asadul Islam, CEO, IDLC Securities Limited (IDLCSL); Anwarul Kabir Bhuiyan, SEC, Executive Director; Tania Sharmin, SEC, Assistance Director (Surveillance); Abul Ehsan, Senior Officer, IDLC Finance Limited; Moumita Manzoor, Research Associate, IDLCSL. Each of them was interviewed for 40 minutes approximately during the office hour while taking break from work. They were asked some essential questions associated to this research topic. Some of the questions that were asked are as follows- What is the role of capital market in the economy? What are the setbacks of the stock market in Bangladesh? Explain the current scenario of the capital market What are the prospective sign of the development of the capital market? How can we be sure of a sound growth of capital market in Bangladesh? Do you see a better or worse scenario ahead of us and why? 8.0 Discussion 8.1 Role of Capital Market in the Economy According to Dr. Mirza Azizul Islam (2006) capital market can play an essential role in enhancing economic development through efficient intermediation of savings into productive investments and in encouraging the expansion of private entrepreneurship (DSE, 2006). The primary market can contribute to the growth of private entrepreneurship by facilitating the entrepreneurs to raise funds from surplus savers and consequently finance investment in a cost-effective manner. For instance, if an industrialist with a viable new investment or expansion proposal is unable to execute his plan due to financial crisis then he can issue securities to meet the required deficit. Moreover issuing shares have the additional advantage that they do not create fixed charges for the companies issuing them and hence endows a better option than, say, financing through bank loans. A proficient and vibrant secondary market can also contribute copiously to economic growth. If a company, for instance, is well-managed and the secondary market prices are higher than face value, subsequent rights issue can obtain premium. Therefore the company can finance its development plan in lucrative and cost-effective approach. So the capital market not only provides opportunity for companies to borrow funds needed for long term investment purposes but also provides avenue for the marketing of shares and other securities in order to raise fresh funds for expansion of operations, leading to increase in output or productivity. The equity market offers opportunity for government to finance projects aimed at providing essential amenities for socio-economic development. Such market encourages inflow of foreign capital when foreign companies or investors invest in domestic securities. The securities market can help attain higher productivity by restructuring of ownership and management of the company as secondary market provides an exit option for the original founders and it also creates an avenue for the populace to participate in the corporate sector of the economy and share in its wealth through ownership of securities. So it not only reduces the over-reliance of the corporate sector on short term finance for long term projects but truly makes available the needed money for venture capital development which could serve as a vehicle for industrial development. So through its allocating mechanism, the capital market ensures an efficient and effective distribution of scarce financial resources for the optimal benefit to the economy. 8.2 Major Setbacks of the Capital Market Investment in capital market is limited to a small proportion of the population. Investors’ confidence in the capital market has not entirely recovered since the stock market crash in 1996. Share market debacle in 1996 was mainly the result of market manipulation by a section of stockbrokers in collaboration with some other market participants (SEC, 1997). Some of the other notable reasons behind the stock market crash includes insider-trading and off-loading of shares by directors of the company, absence of circuit breaker in the securities market, disclosure of unregulated rumors and sensitive information, lack of attention given by investors to the relation between stock price and company fundamentals, weak regulatory body to name a few. The diagram below shows clearly the catastrophe that took place during 1996. Figure 1 DSE General Price Index (DGEN) 1993-2007 (Source: IDLCSL) On November, 2001 the DSE introduced the benchmark price barometer DSE General Index (DGEN) with a base index of 817.62 points. The index excludes companies of Z category and is calculated on the basis of price movement of individual stocks. Figure 1 displays the monthly DSE general index from the year January 1993 to November 2007, the latest month for which the data was available. From the diagram we can tell that the market behaved irrationally during the year 1996. The DSE all share price index rose from 832 in 1 January 1996 to 3567 in 14 November of the same year, i.e. DGEN rose from 1106 to 4738.83. This conspicuous rise in DSI was followed by a drastic fall to 2261.47 points in the last week of December 1996 and again to 1140.65 points on April 1997. The market was dreary for a long period of time after the 1996 collapse but between July 20003 and June 2005, DGEN more than doubled from 823 to 1727. It appears that the index is performing modestly in the current year followed by an uptrend as it shows an increase in the index from 1527.29 in November 2006 to 3011.60 in November 2007, reaching its pinnacle after 1996. The devastating history of 96 crashes still persists in the mind of potential investors but without mass participation the market cannot sustain in the long-run. Also it needs to bring back the foreign investors that fled in the 1996 debacle. Inflows of foreign direct investment need to be restored to stabilize the economy. From the statistical data below in Table 1 it can be observed that foreign investors are least attracted to the securities market of Bangladesh. There were significant foreign investment inflows into equities in the year 1994 amounting to $ 106 million but by the mid 1997, most of the foreign portfolio investors had divested holdings and have not since returned. The following table contains the key capital market indicators reflecting that the pace of primary market development had been fluctuating and the market’s contribution to resource mobilization of the economy remains below potential and the secondary market remained stagnant during 1997-2003 but showed some sign of recovery in 2004. Overall, investor confidence has not yet fully recovered. Table 1 Capital Market Indicators- Dhaka Stock Exchange Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 No of Listed Companies 143 157 183 186 202 208 213 223 231 242 248 337 Market Cap In taka (mn) 18099 41771 56518 168106 71302 50254 44789 62932 63777 71269 97587 224923 In $ (mn) 455 1038 1409 3960 1569 1036 881 1169 1119 1229 1685 3709 Market Cap as % of GDP 1.44 3.08 3.71 10.11 3.95 2.51 2.04 2.65 2.52 2.61 3.25 6.76 Significance of Capital Market for Economic Development Significance of Capital Market for Economic Development An Explotary Study On The Significance of Capital Market for Economic Development and Its Further Growth Potential In Context of Bangladesh Abstract This research paper investigates whether the role of capital market is significant for the economic development of Bangladesh. Literature suggests that well developed stock market can provide an extra impetus to economic activity. Similar conclusions were also drawn from the in-depth interviews. This paper also reveals a well-scanned scenario of the capital market highlighting its setbacks, current weakness, recent improvements and its prospective signs of development through which we can foresee whether the capital market has further growth potential or not. Thus the present study can also contribute in providing essential information that can also be used for further research. Abbreviations ADB- Asian Development Bank CDBL- Central Depository of Bangladesh Limited CDS- Central Depository System CSE- Chittagong Stock Exchange DGEN- DSE general index DSE- Dhaka Stock Exchange GDP- gross domestic product IPO- initial public offering SEC- Security and Exchange Commission 1.0 Introduction The financial market contributes to the economic growth and development by providing the needed finance for provision of goods and services. The financial market consists of two division- money market and capital market. The money market is basically entitled to supply finance on short-term basis to individuals, businesses, enterprises, government and their agencies. The capital market, on the other hand, provides finance on medium to long-term basis to corporate bodies, government and their agencies (Al-Faki, 2006). Capital Market plays a crucial role in any modern economy as they allow investors’ fund to flow to the most promising opportunities, i.e., the funds are mobilized and channeled efficiently from savers to the users of funds (Al-Faki, 2006; DSE, 2006; Hubbard and Thornton, 2006; Ahmed, 1997). In Bangladesh financial intermediation relies mostly on the banking sector which further resulted in lack of equity financing (Salahuddin Ahmed, 2007; Islam and Hassan 2002). Furthermore out of 5 million urban-based middle class people only four hundred thousand are participating in the securities market and among them roughly hundred thousand are active investors. A large portion is still ignorant of the nature and benefits of the capital market (Abu Ahmed, 2006; DSE Review, 2006; Islam and Hassan, 2002). Developing more complete and deeper capital market would enhance a countries growth potential and innovation (Andritzky, 2007). The forces of globalization, technology, new forms of competition have noticeably transformed capital market worldwide (Hassan, 2004). The chief advisor Dr. Fakhruddin Ahmed stated that â€Å"Only a vibrant and well-regulated capital market can bring sustainable economic development in the country through making the real sector capable of meeting the challenges of the competitive global economic realities† ( DSE Monthly Review, June 2007). Regardless of recent improvements, Bangladesh’s capital market remains underdeveloped as its size is still very small in terms of market cap (ADB, 2006; Salahuddin Ahmed, 2007; Islam and Hassan 2002). The market cap represents just above 9% of the GDP (Dr. Fakhruddin Ahmed retrieved from DSE Review). As Bangladesh capital market is still quite small compared to other regional market and to the size of its economy (CSE, 2006) despite its existence for a long time, this paper applies a framework for analyzing the significance of capital market for economic growth and development of Bangladesh, identifying its growth potentials through exploration. 2.0 Problem Statement Bangladesh’s capital market is still underdeveloped, in spite of recent improvements. The size of the country’s capital market is quite small mainly due to the excessive dependence of leading corporate entities on the banks for financing. Moreover the overall transparency of market transaction is also low compared to international standards and generally there has been slow development of the underlying market infrastructure. The government is making effort to develop the reliability and efficiency of stock exchanges as investment market. Compared to the other neighboring countries the numbers of participants are much smaller in Bangladesh as investor lack confidence. There is a supply side constrains in the capital market as quality shares are lacking. For all this reason this research is done to explore the importance of capital market in the economy and what are the prospective sign of development of the stock market. 3.0 Purpose of the Study The purpose of the study is to explore a well scanned scenario of Bangladesh capital market, its significance and its prospects. Although some research has been conducted relating to this topic but there is little empirical evidence about how essential stock market is to economic development of a country. A sound capital market prompts better economic base and influence its future growth and so it can help realize Bangladesh’s growth potential. The capital market of Bangladesh is on the brink to play its due role as a medium for financing investment and thereby making a notable contribution to economic growth, employment creation and poverty alleviation. The capital market plays an important role in quickening the pace of economic development but the existing state of the capital market is under-developed and not in a position to ensure economic progress of the country. Hence this research will try to highlight the significance of capital market for the nation and explore what are the probable signs of progress. 4.0 Research Timeline 2007 SeptemberWriting Research Proposal 2007 SeptemberDeveloping Literature Review 2007 OctoberCollecting Data 2007 October- NovemberData Analysis and Interpretation of the Findings 2007 NovemberPreparing Draft and Finalizing the Research Paper 2007 DecemberSubmission of Research Paper 5.0 Limitations of the study During conducting the research I came across certain limitations and among them the foremost one is time constrain. Although I got the opportunity to work in an organization that is capital market based but it was difficult to find spare time that could be used for the report. Moreover the interviewed person could not provide all necessary information due to lack of time. The research timeline also reveals that time constrain was actually a barrier as there was plenty to find about this research topic. As the research is conducted for the first time, I did not get much support from previous research paper and further research is suggested. A huge portion of the report is based on secondary data collected through websites and so the depth of reliability varies as by the nature of website. 6.0 Review of the Literature 6.1 Financial Intermediation According to Joseph Yam (2004) financial intermediation is channeling savings into investments. Aziz and Duenwald (2002) referred that financial intermediation affects growth through the following channels – (i) it can increase the marginal productivity of capital by collecting information to evaluate alternative investment projects and by risk sharing (ii) it can raise the proportion of savings channeled to investment through financial development. According to Conning and Kevane (2002) â€Å"intermediation implies an intermediary†. Gorton and Winton (2002) added that â€Å"it is the root institution in the saving investment process†. They referred that financial intermediaries are firms that borrow from those who have excess money, that is, the savers and lend the money to companies that need resources for investment. 6.2 Performance Indicators According to R. N. Agarwal (2000) the most commonly used standard to measure the size of a country’s stock market is market capitalization ratio, that is, the ratio of market value of stocks which are currently listed on a bourse to Gross Domestic Product (GDP). A small ratio of capitalization to GDP reveals the small size of a stock market. Alternatively, the size can be measured by the number of listed companies on a stock market. The height of maturity of an economy’s financial system is essential for economic development. Bekeart et al., (2007), Hubard and Thornton (2006), Rosul (2002) all investigated the significance and relation of stock market development with the economic growth and their conclusion suggests that capital market development is positively correlated with long term economic growth and the capital market plays an important role in the economic development of any country. The size of the equity capital market has an optimistic effect on economic growth of the country, that is, much higher market cap and turnover has a major positive influence on the economy (Institute for Advanced Studies, IHS, 2006). It is seen that the ratio of market cap to GDP in neighboring countries like India, Pakistan and Sri Lanka is relatively much higher, that is, more than 60% of their GDP (DSE, Kh. Asadul Islam, 2007; Dr. Fakhruddin Ahmed,2007). In Bangladesh the market cap is very small proportion of the countries GDP (Islam Hassan, 2002) and this is due to significant dependence on the banking sector (DSE Review, Fakhruddin Ahmed, June 2007). Market capitalization as a share of GDP was around 2.5%-3.3% during 2001-2003 compared with 1.4-10.1% during 1993-1996 and 2- 4% during 1997-2000. However in the year 2004 market cap reached 6.8% reflecting the rise in the DSE index from 968 to 1,971 at the end of 2003 and 2004 respectively (ADB, May 2005). The trend of market cap as percentage of GDP and other capital market indicators of DSE and CSE are shown through the help of statistical data represented in the discussion section in Table 1. Despite the existence of the bourse from 1954, the capital market still exhibits features of an emerging equity market (Islam Hassan, 2002). The finance sector is immensely bank-based (Salahuddin Ahmed, 2007) as resource mobilization for industrialization and economic development is made primarily through the regular banking system (Islam Hassan, 2002). Borrowing requires fixed payments and over-reliance on banks can cause credit default risk. According to (Mochammad Rosul, 2002) excessive reliance on bank borrowing results in a mismatch with long-term investments being financed with short-term bank loans. He added that such a risky situation can further contribute to the economic crisis and so the job of the principal fund supplier for business should be transferred from banking sector to the capital sector. 6.3 Regulatory Bodies 6.3.1. The Security and Exchange Commission (SEC) The Security and Exchange Commission (SEC) exercises power under the Security and Exchange Commission Act 1993 and established on June 8, 1993. SEC, the sole Capital Market Watchdog and Regulator, has been pursuing a vigorous capital market development process including amendments of its existing regulations, conduction of investor awareness programs, rigid monitoring and surveillance to bring in transparency in the trading mechanism (SEC, Annual Report 2003 -04). The responsibility of SEC includes the following: Regulating the functions of Stock Exchanges Registering and regulating the business of stock brokers, sub broker, share transfer agents, underwriters, registrar, portfolio managers, investment advisors, and other middlemen related to security dealings. Registering, controlling, and monitoring of all types of mutual funds Controlling and monitoring of all authorized self regulatory organizations Prohibiting fraudulent and unfair practices related to securities Promoting investor’s education program and providing training of intermediaries Regulating substantial acquisition of shares and takeover of companies SEC are detects market manipulation and also keeps constant vigil on the activities of stock exchanges to ensure effectiveness of the surveillance system. Conducts research and publishes information for above purposes (Source: Security Exchange Commission Website: www.secbd.com) 6.3.2 Stock Exchanges 6.3.2.1 Dhaka Stock Exchange (DSE) On April 28, 1954 DSE was first incorporated as the East Pakistan Stock Exchange Association Limited. Formal trading began in 1956 with 196 securities listed on the DSE with a total paid up capital of about Taka 4 billion. On June 23, 1962 it was renamed as Dhaka Stock Exchange (DSE) Limited. After 1971, the trading activities of the prime bourse remained suppresses until 1976 due to liberation war and economic policy pursued by the then government. Trading resumed at DSE in 1976 with only 9 companies listed having a paid up of Taka 137.52 million (Bashar et al., 2000; M Farid Ahmed, 1997). As of today there are 342 listed companies in the prime bourse with market cap exceeding 700,000 million (DSE, 2007). The reforms that DSE undertook recently for ensuring professionalism and transparency focused on the trading of securities. The measure were taken to implement transparent trading system, efficient reporting of trade, real time delivery of information, strong surveillance and monitoring over trade of securities and settlement of shares (Rahman,Uddin and Malik, 2006). 6.3.2.2 The Chittagong Stock Exchange Limited (CSE) The CSE is the countries second bourse that started its operation from the year 1995. It is also a self-regulatory non profit organization. Currently the numbers of listed securities are 223 of which the number of listed companies are 208, mutual funds 14, and one debenture. 6.4 Recent Capital Market Scenario of Bangladesh According to Dr Fakhruddin Ahmed (DSE, 2007) political uncertainty, corruption and lack of transparency in all section of the social and economic fabric are some of the reasons for capital market deficiency. Bangladesh Governor Salehuddin Ahmed (2007) reveals that foremost problems include political instability, under developed infrastructure, poor port management, short comings in legal system and corruption (Financial Express Report). On the other hand DSE general share price index reached its pinnacle and crossed 3000 points (Newage: www.newagebd.com). In fact the capital market witnessed a robust growth in the current year. Both turnover and market cap crossed new milestones at Tk 3000 million and Tk 700,000 million respectively during the year (DSE, 2006; DSE, 2007, IDLCSL). Recently our market cap crossed USD 10 billion that accounts for only 13% of its GDP which was only 8% a year back. (DSE Monthly Review, Oct 2007). Though the contribution of capital market to GDP is still inadequate when compared to neighboring countries but still its increase is significant for the development of our economy. Comparison of indices and market cap among different countries is shown in Table 2 and Figure 2 in the discussion part. Entry of 12 new issues worth Tk 11,322.95 million helped raise the market cap. Some of the reason for the progress in capital market development is central depository system and the automated trading system (ADB, 2006; SEC, 2005). The DSE has upgraded its automated online trading system and investors are able to trade from different parts of the country (SEC Quarterly Report, April-June 2007; ADB, 2006). Another reason for the vigorous improvement of the equity capital market is due to strenuous efforts taken by the SEC that further boosted investors’ confidence (DSE, 2007). 7.0 Research Methodology 7.1 Research Design The present study endeavored to explore importance of capital market for the economic development of Bangladesh and its future prospects. Exploratory research is selected as research design as little information exists about the capital market of Bangladesh. The aim of exploratory research is mainly to gain enough information before doing more thorough research. We basically start by gathering as much information about the object as possible and with a vague impression of what we should study (Cooper Schindler, 2003). 7.2 Research Instrument The research was conducted using both primary and secondary data. For collecting secondary data, various books, websites, newspapers, annual reports, monthly reviews and significant articles were chosen. Also for collection of primary data in-depth interviews with a range of designated professional, related to this field, were taken. 7.3 Data Collection Secondary data used in the paper has been collected through access of different source of books, journals, publications of DSE, SEC, ADB and other news paper and articles. The DSE and SEC library were visited to acquire secondary information. Various websites were browsed to collect relevant articles that are circulated on online sites. For collecting primary data, in-depth interviews of experienced people related to this field of capital market were taken. Appointments were fixed initially and then the interviews were taken. The interviewed persons are Kh. Asadul Islam, CEO, IDLC Securities Limited (IDLCSL); Anwarul Kabir Bhuiyan, SEC, Executive Director; Tania Sharmin, SEC, Assistance Director (Surveillance); Abul Ehsan, Senior Officer, IDLC Finance Limited; Moumita Manzoor, Research Associate, IDLCSL. Each of them was interviewed for 40 minutes approximately during the office hour while taking break from work. They were asked some essential questions associated to this research topic. Some of the questions that were asked are as follows- What is the role of capital market in the economy? What are the setbacks of the stock market in Bangladesh? Explain the current scenario of the capital market What are the prospective sign of the development of the capital market? How can we be sure of a sound growth of capital market in Bangladesh? Do you see a better or worse scenario ahead of us and why? 8.0 Discussion 8.1 Role of Capital Market in the Economy According to Dr. Mirza Azizul Islam (2006) capital market can play an essential role in enhancing economic development through efficient intermediation of savings into productive investments and in encouraging the expansion of private entrepreneurship (DSE, 2006). The primary market can contribute to the growth of private entrepreneurship by facilitating the entrepreneurs to raise funds from surplus savers and consequently finance investment in a cost-effective manner. For instance, if an industrialist with a viable new investment or expansion proposal is unable to execute his plan due to financial crisis then he can issue securities to meet the required deficit. Moreover issuing shares have the additional advantage that they do not create fixed charges for the companies issuing them and hence endows a better option than, say, financing through bank loans. A proficient and vibrant secondary market can also contribute copiously to economic growth. If a company, for instance, is well-managed and the secondary market prices are higher than face value, subsequent rights issue can obtain premium. Therefore the company can finance its development plan in lucrative and cost-effective approach. So the capital market not only provides opportunity for companies to borrow funds needed for long term investment purposes but also provides avenue for the marketing of shares and other securities in order to raise fresh funds for expansion of operations, leading to increase in output or productivity. The equity market offers opportunity for government to finance projects aimed at providing essential amenities for socio-economic development. Such market encourages inflow of foreign capital when foreign companies or investors invest in domestic securities. The securities market can help attain higher productivity by restructuring of ownership and management of the company as secondary market provides an exit option for the original founders and it also creates an avenue for the populace to participate in the corporate sector of the economy and share in its wealth through ownership of securities. So it not only reduces the over-reliance of the corporate sector on short term finance for long term projects but truly makes available the needed money for venture capital development which could serve as a vehicle for industrial development. So through its allocating mechanism, the capital market ensures an efficient and effective distribution of scarce financial resources for the optimal benefit to the economy. 8.2 Major Setbacks of the Capital Market Investment in capital market is limited to a small proportion of the population. Investors’ confidence in the capital market has not entirely recovered since the stock market crash in 1996. Share market debacle in 1996 was mainly the result of market manipulation by a section of stockbrokers in collaboration with some other market participants (SEC, 1997). Some of the other notable reasons behind the stock market crash includes insider-trading and off-loading of shares by directors of the company, absence of circuit breaker in the securities market, disclosure of unregulated rumors and sensitive information, lack of attention given by investors to the relation between stock price and company fundamentals, weak regulatory body to name a few. The diagram below shows clearly the catastrophe that took place during 1996. Figure 1 DSE General Price Index (DGEN) 1993-2007 (Source: IDLCSL) On November, 2001 the DSE introduced the benchmark price barometer DSE General Index (DGEN) with a base index of 817.62 points. The index excludes companies of Z category and is calculated on the basis of price movement of individual stocks. Figure 1 displays the monthly DSE general index from the year January 1993 to November 2007, the latest month for which the data was available. From the diagram we can tell that the market behaved irrationally during the year 1996. The DSE all share price index rose from 832 in 1 January 1996 to 3567 in 14 November of the same year, i.e. DGEN rose from 1106 to 4738.83. This conspicuous rise in DSI was followed by a drastic fall to 2261.47 points in the last week of December 1996 and again to 1140.65 points on April 1997. The market was dreary for a long period of time after the 1996 collapse but between July 20003 and June 2005, DGEN more than doubled from 823 to 1727. It appears that the index is performing modestly in the current year followed by an uptrend as it shows an increase in the index from 1527.29 in November 2006 to 3011.60 in November 2007, reaching its pinnacle after 1996. The devastating history of 96 crashes still persists in the mind of potential investors but without mass participation the market cannot sustain in the long-run. Also it needs to bring back the foreign investors that fled in the 1996 debacle. Inflows of foreign direct investment need to be restored to stabilize the economy. From the statistical data below in Table 1 it can be observed that foreign investors are least attracted to the securities market of Bangladesh. There were significant foreign investment inflows into equities in the year 1994 amounting to $ 106 million but by the mid 1997, most of the foreign portfolio investors had divested holdings and have not since returned. The following table contains the key capital market indicators reflecting that the pace of primary market development had been fluctuating and the market’s contribution to resource mobilization of the economy remains below potential and the secondary market remained stagnant during 1997-2003 but showed some sign of recovery in 2004. Overall, investor confidence has not yet fully recovered. Table 1 Capital Market Indicators- Dhaka Stock Exchange Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 No of Listed Companies 143 157 183 186 202 208 213 223 231 242 248 337 Market Cap In taka (mn) 18099 41771 56518 168106 71302 50254 44789 62932 63777 71269 97587 224923 In $ (mn) 455 1038 1409 3960 1569 1036 881 1169 1119 1229 1685 3709 Market Cap as % of GDP 1.44 3.08 3.71 10.11 3.95 2.51 2.04 2.65 2.52 2.61 3.25 6.76

Dances With Wolves Essay -- Movie Film Native Americans Papers

Dances With Wolves Dances with Wolves offers a cinematic portrayal of Native Americans that is quite contrary to the stereotypical norm. In this film, John Dunbar, goes out to the west where he meets and becomes friends with the Sioux Indians. He is drawn more and more into their community and eventually chooses to side with the humane Indians over his fellow cruel white Americans. In an attempt to change stereotypical views, director Kevin Costner through Dunbar, presents to the audience a different perspective of Indian removal. The film allows viewers to identify and sympathize with the Indians and thus causes a shift of perception towards the Indian problem. Movie critic Ariztlan, in a review of the film, states that Dances with Wolves "showed the Indians as human beings with a culture and way of life that had the full breadth of human dignity, humor, spirituality and family values (http://www.ariztlan.org/mov/wolves)." The stereotypical view of Indians as savage inhumane beings is strategically dw indled in this movie. This film was set around the time of the Civil War which took place from 1861-1865. It was during this time that acts of Indian removal were common. The prevalent attitude of Americans at the time was that of expansion into the west. The primitive Indian inhabitants of the western territory proposed a problem for the Americans. To settle into the west, they had to remove the Indians to other places. In a lecture on the place of the west in American history, Dr. April Summitt addressed the historical framework of Indian removal. The first major Indian removal took place in 1830. They were further removed to smaller reservations in the 1870's and 1880's. With this knowledge of the historical setting, we c... ...m. Dunbar was named Dances with Wolves because he was literally caught prancing around with a wolf. Beyond this literal interpretation is the symbolic one of Dunbar's dance with the Indians. The gist of the film is encapsulated in this one metaphorical story line. The film, Dances with Wolves, is masterfully produced to change the stereotypical view of Native Americans as brutal savages to a fixed view of them as normal human beings. Shift in perception is achieved by first grabbing the audience attention with an initial matched stereotype of cruel Indians. The audience is carried to a new frame of thought through the trustworthy character of Dunbar and his developing relationship with the Indians. In the end, Dunbar's dance with the wolves becomes a great learning experience for him in his life, as well as an eye-opening tool for the humbled American audience.

Swot Analysis of Delta Airlines

SWOT analysis Strength 1. Innovation: * â€Å"Track check bags† 2. Market share leadership 3. Strong management team 4. Strong brand equity 5. Flights are usually on time 6. The merger and acquisition | Weakness * The number of cancelling flights is a little high * The customer service is bad because in some occasion the customer can’t found the delta representative in the airport. Lack of online presence * In some aircrafts the seats are uncomfortable and narrow | Opportunities * Emerging markets and expansion abroad * Product and services expansion * Development of new technologies and the web | Threats * Competition * Economic slowdown and crises * External changes * Lower cost competitors * Price wars and revolution * Oil Price growth * Terrorism| Strength: 1. Innovation: * Delta earned the top 5 in the rank of most innovative airline * â€Å"Track checking bag† new service launched by Delta to allow customer to track their luggage in real-time.Also they can do it via their smartphone using the bag tag number. * On board the plan delta offers the full-lie bed in the business Elite. Also it plans to offer to the flat bed seat to the entire international fleet. * Gogo’s internet service is equipped in all the aircrafts * In 18 airports Delta installed the â€Å"wireless power-pad† 2. Market share leadership: * Delta ranks the first place in the airline domestic market share with 16% * Due to its strong financial strategy Delta was the only airline company which wasn’t affect by the event of September 2001 3.Strong management team: * More than 80,646 employees work in Delta * by providing entertainment in the plan and being helpful with travelers * Through its leadership Mike (the executive vice president of Human resource an labor Relation) established an entire culture in the company. So employees worked as a team not individually, which lead them to focus on the quality of their services. 4. Strong brand equity * â €Å"welcome change welcome new delta† * Due to its brand and history Delta still until now challenging competitors. . Flights on time * In 2013 412,617 of flight are on time which means 80, 89% of all the flights that Delta operates arrive just in time. * This percentage and statistics evolved since 2004 6. The merger and acquisition * Through it 2 last merger with Northwest and virgin airline, Delta become the second largest airline of passengers * In addition this situation allows the company to make many alliance with different airport in different countries.Weakness 1. The number of canceled flights is little high * Despite the fact that the rate of the delayed decrease but still high comparing to Delta which the second largest company * The number of delayed flight represent 7,561 among 509,519operation flights * From the feedback of some travelers they complained ; that the company didn’t inform them about the situation 2. Some complaint about the customer servic e Since 2010 Delta was trying to improve its customer services because it affects directly the number of travelers, thus the company was focusing on training its employees to and offered to those training programs and seminaries to improve their service. 3. Lack of online presence: * Delta needs to improve its application for privacy policy. * The social network are not update 4. Uncomfortable seats From some customers opinion I conclude that there some seat especially the economy class in the old aircrafts are uncomfortable.And the company did a huge mistake for using those plan for long time flight (so the customer in this case will be disappointed and they admitted that they have spent the worst flight on their life) Opportunities 1. Emerging market and expansion aboard : * This situation leads Delta to increase its market share * The company preview to include flights to Romania, Dubai and other countries. * From this expansion the company’s revenues increase by 20u 2. Pr oduct and service expansion Sky-bonus is a service designed for company to collect points and become member in delta sky club. * There is also the award business Elite service, sky Mile and many other services. 3. Development of new technologies * Technologies nowadays is growing faster so delta should be aware of this situation and try to search and innovate some technologies which can help the customer and offer to him a high level of satisfaction. Threats 1. Competition * local competitors like southwest airline, US airways . Economic slowdown and crises * Can decrease the number of customers, thus the revenues of Delta will decrease also. * Especially the European crises which affects many businessmen and leads to their bankruptcy 3. External changes * For example the taxation, political situations, wars. 4. Lower cost competitors * This situation can affects badly company especially they use lower cost and lower service to offer to their customer cheaper tickets for their fligh ts 5. Price wars and revolution In this case the company should delayed flights, as a consequence its revenue will decrease. 6. Oil price growth * Oil price increase every years which is one of the major cost of the company 7. Terrorism http://www. airlinequality. com/Product/Yseat-DL. htm http://news. delta. com/index. php? s=18&item=88 http://dealbook. on. nytimes. com/Public/Deals? symbol=DAL https://www. worldagentdirect. com/deltaair/products/index. do http://www. transtats. bts. gov/HomeDrillChart. asp? URL_SelectYear=2013&URL_SelectMonth=1&URL_Time=1&URL_Selection=1 Swot Analysis of Delta Airlines SWOT analysis Strength 1. Innovation: * â€Å"Track check bags† 2. Market share leadership 3. Strong management team 4. Strong brand equity 5. Flights are usually on time 6. The merger and acquisition | Weakness * The number of cancelling flights is a little high * The customer service is bad because in some occasion the customer can’t found the delta representative in the airport. Lack of online presence * In some aircrafts the seats are uncomfortable and narrow | Opportunities * Emerging markets and expansion abroad * Product and services expansion * Development of new technologies and the web | Threats * Competition * Economic slowdown and crises * External changes * Lower cost competitors * Price wars and revolution * Oil Price growth * Terrorism| Strength: 1. Innovation: * Delta earned the top 5 in the rank of most innovative airline * â€Å"Track checking bag† new service launched by Delta to allow customer to track their luggage in real-time.Also they can do it via their smartphone using the bag tag number. * On board the plan delta offers the full-lie bed in the business Elite. Also it plans to offer to the flat bed seat to the entire international fleet. * Gogo’s internet service is equipped in all the aircrafts * In 18 airports Delta installed the â€Å"wireless power-pad† 2. Market share leadership: * Delta ranks the first place in the airline domestic market share with 16% * Due to its strong financial strategy Delta was the only airline company which wasn’t affect by the event of September 2001 3.Strong management team: * More than 80,646 employees work in Delta * by providing entertainment in the plan and being helpful with travelers * Through its leadership Mike (the executive vice president of Human resource an labor Relation) established an entire culture in the company. So employees worked as a team not individually, which lead them to focus on the quality of their services. 4. Strong brand equity * â €Å"welcome change welcome new delta† * Due to its brand and history Delta still until now challenging competitors. . Flights on time * In 2013 412,617 of flight are on time which means 80, 89% of all the flights that Delta operates arrive just in time. * This percentage and statistics evolved since 2004 6. The merger and acquisition * Through it 2 last merger with Northwest and virgin airline, Delta become the second largest airline of passengers * In addition this situation allows the company to make many alliance with different airport in different countries.Weakness 1. The number of canceled flights is little high * Despite the fact that the rate of the delayed decrease but still high comparing to Delta which the second largest company * The number of delayed flight represent 7,561 among 509,519operation flights * From the feedback of some travelers they complained ; that the company didn’t inform them about the situation 2. Some complaint about the customer servic e Since 2010 Delta was trying to improve its customer services because it affects directly the number of travelers, thus the company was focusing on training its employees to and offered to those training programs and seminaries to improve their service. 3. Lack of online presence: * Delta needs to improve its application for privacy policy. * The social network are not update 4. Uncomfortable seats From some customers opinion I conclude that there some seat especially the economy class in the old aircrafts are uncomfortable.And the company did a huge mistake for using those plan for long time flight (so the customer in this case will be disappointed and they admitted that they have spent the worst flight on their life) Opportunities 1. Emerging market and expansion aboard : * This situation leads Delta to increase its market share * The company preview to include flights to Romania, Dubai and other countries. * From this expansion the company’s revenues increase by 20u 2. Pr oduct and service expansion Sky-bonus is a service designed for company to collect points and become member in delta sky club. * There is also the award business Elite service, sky Mile and many other services. 3. Development of new technologies * Technologies nowadays is growing faster so delta should be aware of this situation and try to search and innovate some technologies which can help the customer and offer to him a high level of satisfaction. Threats 1. Competition * local competitors like southwest airline, US airways . Economic slowdown and crises * Can decrease the number of customers, thus the revenues of Delta will decrease also. * Especially the European crises which affects many businessmen and leads to their bankruptcy 3. External changes * For example the taxation, political situations, wars. 4. Lower cost competitors * This situation can affects badly company especially they use lower cost and lower service to offer to their customer cheaper tickets for their fligh ts 5. Price wars and revolution In this case the company should delayed flights, as a consequence its revenue will decrease. 6. Oil price growth * Oil price increase every years which is one of the major cost of the company 7. Terrorism http://www. airlinequality. com/Product/Yseat-DL. htm http://news. delta. com/index. php? s=18&item=88 http://dealbook. on. nytimes. com/Public/Deals? symbol=DAL https://www. worldagentdirect. com/deltaair/products/index. do http://www. transtats. bts. gov/HomeDrillChart. asp? URL_SelectYear=2013&URL_SelectMonth=1&URL_Time=1&URL_Selection=1

Multi-Narrative Essay Example

Multi Multi-Narrative Essay Multi-Narrative Essay How Collins portrays Victorian attitudes will also be examined in this essay. Not much Is revealed about MISS. Clack In any of the narratives apart from hers. Collins gives her a voice for a specific reason. Through her he can criticism the other characters without criticizing them directly and this gives more depth to the novel. In Footbridges first narrative we learn very little about Miss. Clack but his narrative introduces us to the character of Miss. Clack. As we know very little about her it creates a sense of suspense, as she becomes another part of the puzzle of who stole he Diamond. In her narrative we get an Insight to what Miss. Clack Is really like. She Is shown to have a curious nature, as she says, l waited for a minute or two, more than a minute or two. This is said when Miss. Clack is considering who had entered the house. Because of her curiosity and suspicion, the reader Is also curious and suspicious. What Miss. Clack discovered was Geodesys proposal to Rachel. If Collins had not set the style as a multi-narrative structure then this important piece of information would not have been revealed to us. No other character Is as curious as Goodbye than Clack, so she Is the only one who found out about his proposal. She also keeps enquiring throughout the narrative about the secret which Rachel and Mr.. Brief hold. This makes the reader suspicious as to what information is being withheld from Clack. We also find out more about Victorian attitudes due to the multi-narrative structure, as each character has their own views on events, and the reader can see how different classes treat the same events. MISS. Clack Is born of a higher class, and this Is shown by her arrogance and It can be seen that she Is also stuck In her class spite the poorer circumstances at the point when she is writing. She wants to be accepted by the upper classes and does not want to be downgraded. She moves to a little town and her excuse for this is for economys sake. People in Victorian times saw class as an important matter, and they would strive to be in the best circles they could possibly be in. This Is why Clack Justifies her move, as she does not want people to tank seen NAS move Tort toner reasons, sun as a lack AT money . Nils snows she is prepared to Justify and maybe change details to Justify events or actions. Clack is also very religious as she reinforces her statements with religious words. My sacred regard for truth is This suggests she is very religiously minded, as were most Victorians of that day and age, who thought there main aim should be getting to heaven. She is strictly religious, and her strictness is also portrayed in her narrative. She had a strict routine and liked to keep things ordered, and not vary them. In the same order, same place, even the same chair. This sho ws Clack has a very disciplined way of doing things, meaning her account is useful for giving us the right vents in the right order. Sergeant Cuffs narrative is set out in Just the way the reader would expect a detective to write. He gives his opinions and thoughts about the theft of the Diamond along with an explanation of why he believes what he believes what he believes. He backs up his explanation with evidence. He believed Goodbye was killed by being smothered with a pillow from his bed, as he was found with the pillow of the bed over his face. Although this seems trivial it is an underlying principle of his personality. He feels the need to explain every event that happened and not Just state what happened. This is what makes the reader believe Sergeant Cuff must be right as he explains his views, unlike some of the characters. Cuffs intellectualism is also shown in his narrative along with his Just views, which makes the reader inclined to trust his Judgment. Sergeant Cuffs narrative is important as it shows how Collins has made him very inquisitive. He says l shall endeavourer showing he is interested in finding out more. It is this inquisitiveness that sets off a widespread detective-fever amongst the other characters, victims and suspects alike. This fever spreads from Franklin Blake, to Gabriel Bettered, to Matthew Brief, to Mr.. Marguerite, to the three Indians and widens the net of suspicion, the opposite of what is trying to be achieved. Cuff makes many predictions as to what has happened, although not all of them have solid evidence. When writing about who committed the murder, he puts, There is here moral if not legal evidence that the murder was committed by the Indians. As it is not legal evidence, the reader is not totally sure if it was the Indians who committed the crime, and this brings a sense of suspense, as the crime may have been committed y someone other than the Indians. Here Collins is trying to show equality and there should not be a prejudice against the Indians. Just because they are different it doesnt make them inferior and have different morals, meaning they are prepared to steal. The sense of suspense is maintained throughout the novel due to the multi-narrative structure. Where one narrative ends and the sense of mystery seems to have settled down a new narrative begins and a new sense of mystery is brought about. Using character who hadnt played a role in the previous narrative, suspense is kept throughout the novel. A new perspective on the mystery is given in each narrative Ana Day ten time ten reader NAS Decode accustomed to one perspective, ten next perspective begins and constant suspense is achieved throughout the novel. Ezra Jennings narrative is set out differently from the rest as it is comprised of extracts from his Journal. This means that everything he writes in there he believes to be the truth. Because of the multi-narrative structure some of the narratives could have an altered version of the truth and might not give an accurate view of the occurring events, leading the reader astray. Jennings has an outsider role in the evolve as he is the doctors assistant and because he is associated with medicine he is not popular, as the Victorians were suspicious of the medical profession. Collins tries to show everybody should be accepted throughout the play and this is finalized with the outsider character being the one to solve the mystery. This is also shown as Roseanne, one of the maids, is an outsider but she plays a large role in the novel and Collins also tries to create sympathy for her. Jennings was the character who was mainly responsible for solving the mystery of the Diamond through scientific nature, which can be compared to forensic evidence. The Moonstone was the first novel to explore forensic science and it showed how at this point of the Victorian era, they were advancing in the new science of criminology. Collins purposely makes the detective expert (Sergeant Cuff fail in solving the mystery while the scientific man (Ezra Jennings) succeeds. This shows Collins could have been making the point that the Victorians were now starting to put more and more faith into science, although they still were suspicious about it. Bettered says Jennings has a medical enterprise. This proves that he is a scientific man and the other characters can see that. Jennings also accepts he is a scientific man, showing it is proud to be so in the eyes of the Victorians. He says Science sanctions my proposal, fanciful as it may seem. Jennings is the one who introduces the idea of the opium causing Franklin Blake to act to take the Diamond. He explains that Franklin was not in his right mind when he took it, and was in a state of sleep-walking. Because Flakes mind was on the Diamond when he went to sleep the opium made him concentrate on this when it took effect. However because people were suspicious at the time of medical practice Jennings did not voice his opinion straight away. Jennings is introduced as a mystery to us, and all we know is that he is Dry. Candys assistant. This creates suspense as he has been mentioned in the other narratives as well but the reader is still suspicious of him as they know little about him. Gradually Collins presents more of him, and the reader finds out Jennings is part English and part Indian. Jennings holds a mysterious place at the heart of both worlds, Just like he is at the heart of the novel. His experiment on Franklin Blake reveals the suspicion the English had against the three Indians should be returned upon them, as in the end it is one of their own, Goodbye Blithest, who played the major role in the crime. I believe using multiple voices had the desired effect that Collins wanted it to. It created suspense throughout the novel and a feeling that nothing was definitive and anything could change to alter the path of the novel. This technique especially works in a detective novel as details are crucial and if these details are mixed, which is done using multiple voices then a lot of suspense and uncertainness is caused.

What Is the SSAT Expert Guide to the 3 Levels

What Is the SSAT Expert Guide to the 3 Levels SAT / ACT Prep Online Guides and Tips Are you interested in going to private school? If so, you might need to take the SSAT to get in. But what is the SSAT? It'san admissions test that independent schools throughout the U.S. and the world use to assesstheir prospective students. The testis available in three levels, so students in elementary, middle, and high school can take it. This comprehensive guide will go over each level of the SSAT so you can learn all about its purpose, structure, and questions. You’ll also find six usefultips for test prep. To start, let’s go over the purpose of the test. What Is the SSAT and Who Takes It? The SSAT is designed for students in grades 3 through 11 who are seeking admission to private schools. It’s available in three levels: elementary for students in grades 3 and 4, middle for students in grades 5 through 7, and upper for students in grades 8 through 11. Students take the test according to their current grade, not the one to which they’ll be applying. If you’re in 7th grade, for instance, you'd take the middle level test, not the upper level one. Similarly, 4th graders applying to 5th grade would take the elementary level, not the middle level. Since you’ll have to wait several weeks for your score report, you should take the test well ahead of any school application deadlines. Students can take the test more than once on variousSaturdays throughout the school year. If you need to arrange a different testing date, then you can set up a â€Å"Flex Test.† Unlike the regularly scheduled SSAT tests, you can only take one Flex Test per year. For most students, the most convenienttesting center will bea nearby private school. There are independent schools that administer the SSAT in countries all over the world. You can find the full list of private elementary, middle, and high schools that give the teston its official website. The SSAT, like the SAT for colleges, is just one piece of a student’s private school application. Along with strong grades and extracurriculars, the student should aim to present competitive test scores. With this in mind, let’s take a closer look at what the SSAT tests at all three levels. The SSAT offers three delicious levels for elementary, middle, and high school students. What Does the SSAT Test? Questions and Skills Despite their differences, all levels of the SSAT share the same goal, to measure your verbal, quantitative, and reading comprehension skills. The verbal sections of the testask about vocabulary, verbal reasoning, and relationships between ideas. The quantitative sections will ask you to solve problems with mathematical concepts. Finally, the reading sections present passages and ask questions about their content. All three levels of the SSAT also have a writing section. This section is unscored, but your written response will be sent to score recipients. This means that admissions officers might read your response and use it as a sample of your writing skills. Younger students answer a creative writing prompt, while older students have a choice between writing a story or a more traditional essay. Now that you have a general answer to the question of what the SSAT is, let’s take a closer look at each level, starting with elementary. All of the sample questions are borrowed from the official website. SSAT: Elementary Level The elementary level is geared toward students in grades 3 and 4. The test at this level is unique since it’s further divided into sublevels, one that’s slightly easier for third graders and one that’s a bit more advanced for fourth graders. Both tests, though, share the same format and structure. The elementary level SSAT lastsone hour and 50 minutes and has a math, verbal, reading, and writing section. You can see the complete structure in the chart below. Section Number of Questions Time Math 30 30 Verbal 30 20 Break - 15 Reading 28 30 Writing 1 prompt 15 Total: 89 110 minutes (1 hour, 50 minutes) With this overall structure in mind, let’s take a closer look at each individual section, starting with Math. Elementary Level Math Section The Math section features all multiple choice questions that ask about a variety of concepts. They might involve addition, subtraction, multiplication, and division. You couldbe asked to put numbers in order from least to greatest, or vice versa. You’ll also encounter some basic geometry, measurement, and graphs. The fourth-grade version of the test may also have a question or two about angles. Below are a couple of sample questions fromthe math section of the elementary level test. The first is a word problem testing comprehension and multiplication while the second is straightforward subtraction. 1. The Smith family drove 300 miles every day for 4 days. How far did they drive on their trip? 75 miles 304 miles 600 miles 1200 miles 1500 miles 2. 922 − 157 = 753 765 776 835 1079 After the 30-minute math section, students will start on a20-minute verbal section. Elementary Level Verbal Section The verbal section asks two main types of questions: vocabulary questions and analogy questions. It tests vocabulary by presenting a word and asking you to choose its synonym from five options. The questions feature words from various subjects, including science, technology, and social studies. Here’s an example of a typical vocabulary question that asks you to choose the presented word’s synonym. COOPERATE: join help delay finish support Analogy questions ask test-takers to make comparisons between two words or phrases. The relationship might be that of synonyms, antonyms, homonyms, or part to whole, to give just a few examples. The words may also fall into similar categories or share certain characteristics. Here’s an example of a typical analogy question. Minute is to hour as men is to our week is to day cow is to milk month is to year man is to woman The third and fourth grade tests share the same kind of questions, but, just as in the math section, the fourth grade test may be slightly more advanced. Simply put, the fourth grade test may feature more advanced vocabulary. Moving onto the third section, read on to see how the elementary SSAT tests reading comprehension. Elementary Level Reading Section On the Reading section, you’ll get seven short passages of poetry, prose, fiction, or nonfiction. After each passage, you’ll answer four multiple choice questions about what the passage’s mean. The questions might ask you to summarize the main idea, to locate specific information, or to define words in context. The slightly more advanced fourth grade test may additionally feature questions that ask about theme. Below is an example of a typical nonfiction passage, followed by a question about the main idea and a word in context. A hiker’s foot dangling from a boat sets the crocodile in motion. When saltwater crocodiles sense food, it can start a "feeding frenzy." Crocs race in from all directions. They go wild, attacking all within reach, including humans. They have been known to jump out of the water and attack humans or dogs on land. Crocodiles are highly territorial, especially females with babies. It is not wise to approach baby croquettes. They may look cute and harmless, but they are not. Smaller freshwater crocodiles might attack if bothered. A camper poked what he thought was a sleeping crocodile with a stick. Suddenly the crocturned and bit off his leg. 1. This passage is primarily about hiking safety rules the dangers of fishing why crocodiles attack dangers of baby crocodiles different kinds of crocodiles 2. In line two, "frenzy" most closely means race time calm furor mental illness After Reading, students will move onto the last section, Writing. Elementary Level Writing Section This final section asks students to write a story based on a picture. The prompt reminds students to make sure their story includes a beginning, middle, and end. Remember that this writing sample isn’t scored, but schools will receive a copy of it. Below is an example of a Writing prompt on the elementary level test. Look at the picture and tell a story about what happened. Make sure your story includes a beginning, a middle, and an end. Once students finish the Writing section, they’ll be all done with the test! Cheer up, melancholy knight. The SSAT also has a test for the middle ages. SSAT: Middle Level If you’re in grade 5, 6, or 7 applying for grades 6, 7, or 8, then you’ll take the middle level SSAT. The middle level test is much longer than the elementary level at three hours and five minutes. Its Writing section, while still unscored, comes at the beginning of the test. It also features an unscored experimental section with 16 multiple choice questions. The chart below shows the full structure of the middle level test. Section Number of Questions Time Writing 1 25 minutes Break - 5 minutes Math 25 30 minutes Reading 40 40 minutes Break - 10 minutes Verbal 60 30 minutes Math 25 30 minutes Experimental 16 15 minutes Total: 167 3 hours, 5 minutes Likethe Writing section, the experimental section is unscored. It will ask six verbal, five reading, and five math questions to test out material for future tests. Now that you have a sense of the test’s overall structure, let’s examine each individual section in more detail, just as we did with the elementary level above. First up is Writing. Middle Level Writing Students taking the middle level SSAT will choose from one of two creative prompts. Based on one of two â€Å"story starters,† they’ll write a story in 25 minutes. Below are typical instructions for the Writing section, followed by two story starters. Directions: Schools would like to get to know you better through a story you tell using one of the ideas below. Please choose the idea you find most interesting and write a story using the idea as your first sentence. Sample Topics: The classroom was empty. I looked into its eyes and suddenly... Again, the story is unscored, but score recipients will get a copy of the response. The next section, however, is definitely scored. After a five-minute break, students will continue on to the Math section. Middle Level Math The Math section asks you to solve problems that fall into four main conceptual categories: number concepts and operations, algebra, geometry/measurement, and data analysis/probability. Number concepts and operations involve addition, subtraction, multiplication, division, arithmetic word problems, ratios, percentages, estimation, sequences, rational numbers, and frequencies. Algebra includes algebraic word problems, line equations, patterns, absolute value, and exponents. Geometry/measurement asks about area and circumference of circles, area and perimeter of polygons, volume, properties of triangles, parallel and perpendicular lines, coordinate geometry, and slope. Finally, data analysis/probability involves interpreting tables and graphs, trends, inferences, and probability. Below are a couple sample problems from the math section of the middle level test. Both fall into the number concepts and operations skill area. 1. In a class of 25 students, 8 received a grade A on a math quiz. What percent of the students did not receive an A? 8% 25% 32% 68% 78% 2. An elevator is on the first floor. It goes up 8 floors, then down 5 floors, and then up 4 floors. What is the final position in terms of the first floor? 3rd floor 4th floor 5th floor 7th floor 8th floor Since students in grades 5 through 7 take the middle level test, some may find this section easier than others. Younger students might need to learn new concepts before taking the SSAT, while older students likely have had more more experience with the tested concepts in school. After Math, you’ll move immediately onto Reading. Middle Level Reading The 40-minute Reading section contains passages of 250 to 350 words taken from literary fiction, humanities, science, and social studies. These passages might be narrative or argument-based. The multiple choice questions ask about main idea, details, words and phrases in context, along with the author’s purpose, attitude, and tone. They might also ask you to make inferences, evaluate arguments, or make predictions. The following is a sample passage taken from literary fiction. The first question is detail-oriented, while the second asks you to make an inference. Little Jim was, for the time, Engine Number 36 and he was making the run between Syracuse and Rochester. He was fourteen minutes behind time, and the throttle was wide open. As a result, when he swung around the curve at the flower bed, a wheel of his cart destroyed a tulip. Number 36 slowed down at once and looked guiltily at his father, who was mowing the lawn. The doctor had his back to the accident, and he continued to pace slowly to and fro, pushing the mower. Jim dropped the handle of the cart. He looked at his father and at the broken flower. Finally, he went to the tulip and tried to stand it up, but it would only hang limply from his hand. Jim could not repair it. He looked again toward his father. 1. According to the passage, Jim's father was a (A) farmer(B) doctor(C) gardener(D) train engineer(E) business executive 2. Jim apparently thought that when his father saw the broken flower his reaction would be one of (A) fear(B) anger(C) curiosity(D) amusement(E) indifference As you can see, a strong grasp of vocabulary is important for doing well on the Reading section. Vocabulary comes directly into play in the next section, the 60-minute verbal. Middle Level Verbal The verbal section tests your understanding of vocabulary and of the relationships between words and ideas with synonym and analogy questions, just like the verbal section in the elementary level. Synonym questions simply present you with a word and ask you to choose its closest synonym, as in the following example. EGREGIOUS: (A) trivial(B) hidden(C) flagrant(D) fragrant(E) contagious Analogy questions ask you to recognize the relationship between two words or phrases, like synonym, antonym, cause/effect, and part/whole. The following, for instance, shows two antonyms. Translucent is to opaque as light is to (A) sun(B) dull(C) lamp(D) candle(E) darkness As you can tell, the elementary level and middle level SSAT are very similar in terms of skills tested and question types. The similarities continue into the upper level test, which simply incorporates more advanced material for older students. Read on for its full structure, along with a breakdown of each individual section. Are you hoping to attend a private high school? If so, you'll be taking the upper level SSAT. SSAT: Upper Level The upper level testis geared toward students in grade 8 to 11 who are applying to private high schools. It has the same structure as the middle level test, but again, it features more advanced material. This chart shows the test’s format as a whole. Section Number of Questions Time Writing 1 25 minutes Break - 5 minutes Math 25 30 minutes Reading 40 40 minutes Break - 10 minutes Verbal 60 30 minutes Math 25 30 minutes Experimental 16 15 minutes Total: 167 3 hours, 5 minutes The experimental section asks six verbal, five reading, and five math questions. These questions are unscored and are just given to test out material for future tests. As with the other levels, your response in the writing section is unscored but will be sent to your score recipients. Read on to see what kind of prompts you’ll get in the Writing section. Upper Level Writing Students get two prompts in the writing section and choose just one to answer. One prompt is creative while the other is a more traditional essay question that asks for your personal opinion. Below are the typical directions for the writing response, followed by two sample topics. Remember, you only have to answer one! Directions: Schools would like to get to know you better through an essay or story using one of the two topics below. Please select the topic you find most interesting and fill in the circle next to the topic you choose. Sample Topics: 1. If you could do something over again, what would it be and why? 2. He couldn't believe they wanted his help. Even though this section’s unscored, you’ll want to make sure your response is clear, organized, and features strong grammar and syntax. Admissions officers will likely use it to evaluate your writing. After writing your story or essay, you’ll move on to the Math section. Upper Level Math The concepts that the upper level math section tests match those on the middle level. The questions will just be more complex and advanced. To review, the skill areas are number concepts and operations, algebra, geometry/measurement, and data analysis/probability. Number concepts and operations questions involve addition, subtraction, multiplication, division, arithmetic word problems, ratios, percentages, estimation, sequences, rational numbers, and frequencies. Algebra might involve algebraic word problems, line equations, patterns, absolute value, or exponents. Geometry/measurement asks about the area and circumference of circles, area and perimeter of polygons, volume, properties of triangles, parallel and perpendicular lines, coordinate geometry, and slope. Data analysis/probabilityquestions ask you to interpret tables and graphs, find trends, make inferences, and calculate probability. The following are two official â€Å"number concepts and operations† questions. 1. Which number represents one thousand four hundred and thirteen thousandths? 1,400.13 1,400.013 1,400.0013 10,400.13 100,400.13 2. Find the missing number in the sequence: ___, 29, 35, 41, 47 22 23 24 25 26 After the math section, you’ll move onto Reading. Upper Level Reading The Reading section features narrative or argument-based passages of 250 to 350 words each. They’re taken from literary fiction, humanities, science, and social studies. The subsequent multiple choice questions might ask you to recognize the passage’s main idea, locate details, make inferences, derive the meaning of words or phrases, determine the author’s purpose or tone, evaluate opinions, or make predictions. The following sample question features a passage taken from literary fiction. The questions ask you to interpret a detail and describe the passage as a whole. We had a consuming desire to see a pony rider, but somehow or other all that passed us streaked by in the night, and so we heard only a whiz and a hail, and the swift phantom was gone. But now the driver exclaims: "Here he comes!" Every neck is stretched and every eye strained. Away across the endless dead level of the prairie a black speck appears. Soon it becomes a horse and rider, rising and falling, sweeping nearer and nearer, and the flutter of hoofs comes faintly to the ear. Another instant a whoop and hurrah from our upper deck, a wave of the rider's hand, but no reply, and man and horse burst past our excited faces and go winging away like a belated fragment of a storm! 1. At the driver's call, the people became more eager puzzled hysterical frightened disappointed 2. This passage can best be described as an account of an event a news article a research study an epic poem an advertisement While the reading section tests your vocabulary with words in context questions, the verbal section tests your vocabulary with synonym and analogy questions. Upper Level Verbal If you’ve read about the elementary and middle level verbal sections, then you should be familiar with its question types. The upper level verbal section is no exception and similarly features synonym and analogy questions. The following, for example, is a synonym question; it wants you to choose the answer that most closely matches the presented word in meaning. INCOGNITO: lost replaced concealed uncovered distinguished This next analogy sample question wants you to recognize the relationship between the presented words and then find that same relationship between words in the answer choices. In this case, an epidemic occurs when a disease becomes widespread. Similarly, a famine occurs when hunger becomes widespread. The relationship between the words in answer choice A matches the relationship between epidemic and disease. Epidemic is to disease as famine is to hunger creative is to creation persuasion is to composition mountainous is to climb ache is to gluttony So there you have it, the structure of each level of the SSAT and a breakdown of each section, writing, math, reading, and verbal, with official sample questions. Before considering how you can prep for this important test, let’s go over what you need to know about how the testis scored. Aim for a high percentile to stay ahead ofthe bell curve! How Is the SSAT Scored? Your SSAT score report will tell you how you did on each scored section - verbal, math, and reading - as well as your total score, or the sum of your section scores. You’ll also get percentiles that show how your performance compares to that of other test-takers. Each level is scored on a different scale.Section scores for the elementary level range from 300 to 600. For the middle level, sectionscores range from 440 to 710. Finally, scores for each section range from 500 to 800 for the upper level. Level Minimum Score by Section Maximum Score by Section Elementary 300 600 Middle 440 710 Upper 500 800 As there are three sections per test, verbal, math, and reading, your total scores representyour three section scores added together. Level Total Minimum Score Total Maximum Score Elementary 900 1800 Middle 1320 2130 Upper 1500 2400 At all levels, you’ll get one point for every correct answer, zero for skipped answer, and a deduction of  ¼ point for wrong answers. While you may have personal goals for your SSAT scores, you can also set target scores based on what you need for admission to your private school of choice. Many private schools release data on the average SSAT scores of accepted students. You can research this information and set your target scores above the average. Once you have your goal in mind, you’ll need to prep to achieve those scores. As with the SAT and ACT for college, studying and taking practice tests are important for doing well on the SSAT. Read on for a few tips for preparing effectively for the test. Preparing for the SSAT: 6 Tips Even though the SSAT is a skill-based, rather than content-based test, it still calls for a good deal of studying. Prepping with high-quality materials is a key part of achieving your target scores and getting into your private school of choice. Below are six tips to guide your studying. First, you should consider how much you need to study and when you plan to take the test. 1. Design a Study Schedule and Test-Taking Timeline How much do you need to study? How much time do you have? When do you plan to take the test? All of these are questions you should ask yourself as you start to plan your SSAT prep. The SSAT is offered on eight Saturdays from September to June, and you can take it as many times as you want. If none of the offered test dates work for you, then you might be able to arrange a Flex Test. Remember that you can only take one Flex Test per year. You might take the testfor the first time months ahead of your private school application deadlines so you have the opportunity to take it again if you want higher scores. If your application deadlines are in the winter, for example, you could take your first SSAT in the spring. That way, you have a second opportunity to test the following fall. Once you set your first test date, consider how long you have to study. Ideally, you have at least three to four months to prepare. The best way to meet your studying goals is to build prep into your routine by setting aside specific time each day or week. By designing a study plan and test-taking schedule several months before your first deadline, you can ensure that you have plenty of time to prepareso you can achieve your target scores. Time yourself when you take practice tests so you can get used to the rhythmof the SSAT. 2. Take Lots of Practice Tests and Reflect on your Results The SSAT is a unique test; chances are, you’re not accustomed to answering dozens of synonym and analogy questions anywhere else(to give one example). As a unique test, it’s critical for you to get familiar with its structure, format, and question types. Reading through this guide’s a great first step. Then you should set aside time to take practice tests, especially under simulated testing conditions - time yourself, find a quiet environment, etc. Make sure your materials are high-quality and specific to the level that you’ll be taking. After you take timed practice tests, score your tests and carefully go over your results. Figure out why you got a question wrong. Were you fuzzy on a specific concept? Did you make a careless error? Did you run out of time? By rooting out the reason behind your mistake, you can figure out what to do about it. You may need to review concepts in geometry or try time management strategies for skimming the passages. By pinpointing and addressing your errors, you can fill in any gaps and see improvement the next time. You might begin with a diagnostic practice test to gauge your starting point. Then you could stagger practice tests throughout your prep to measure your progress and readjust your study plan if need be. 3. Study Vocabulary and Word Relationships As you noticed above, all three levels test your verbal skills in the same way, with questions about synonyms and analogies. Studying level-specific vocabulary is an important part of your SSAT prep. Rather than just focusing on the traditional vocab term + definition list, you should look at groups of words with similar meanings. Your prep materials should have vocabulary lists for your level of the test. You can also find vocab lists on the website Quizlet, or even upload your own for review with interactive games. To master analogy questions, make sure your prep materials break down the different relationships that can appear. Some of these might be synonym, antonym, part to whole, or cause/effect. By studying these relationships and pairing them with practice questions, you should be able to recognize the relationship when you answer analogy questions on the test. For the verbal section of the SSAT, don't just study the meanings of words, but also their relationships with each other. 4. Review Tested Math Concepts The math section of the SSAT can be challenging, especially for younger students who haven’t studied as advanced concepts as their older counterparts who are taking the same test. You should make sure your study materials explain all the concepts you’ll need to know. Algebra on the upper level test, for instance, can be broken down into lots of subtopics, includingword problems, line equations, and exponents. If there are concepts that you’ve never encountered, then you may study them from books or find a tutor who can teach them to you. As a younger student, you shouldn’t have to score in as high a percentile as an older student. Still, though, you don’t want to be taking the test and come across problems that look totally unfamiliar. As you review each concept, pair it with lots of related practice questions. While it’s useful to review each rule individually, remember that some questions may require you to combine concepts in order to solve them. The math section may be closely aligned with what you’re doing in math class. The problems are probably more typical to your homework and class tests than the questions in the verbal section, for instance. Still, though, make sure to study with realistic SSAT practice questions so you can get used to their wording and format. 5. Read Widely and Often How can you study for the reading section? To some extent, all of the reading you’ve done over your lifetime will help you on this section. While you’ve developed your reading comprehension skills over the long-term, you can still take a specific approach to this section. First, keep in mind that the reading section tests you on works from various genres, including literary fiction, nonfiction, and argument-based writing. Reading fiction will help, but you should also practice reading articles from areas like science and social studies. As you read, take notes on essential elements like main point, keydetails, and tone. Beyond taking the time to really engage with and analyze a work, you should hone your ability to read quickly and with purpose. Practice your ability to skim a work for its main point and important details. The test is timed, so you need to be able to gather important points under time limits. The more you practice time management strategies with practice SSAT reading sections, the more efficient you’ll become. While math, reading, and verbal skills will get you far, you also want to have some tried-and-true test-taking strategies up your sleeve. 6. Be Strategic with Your Time and Guessing Finally, you should go beyond studying math concepts and vocabulary to develop test-taking and time management strategies. You’ll only get about a minute or less to read, consider, and answer each multiple choice question. The more you practice and try different tactics - like skimming passages or process of elimination - the more efficient you’ll become. Taking timed practice tests will also help you get accustomed to each section’s time limits and how to allocate your time well. As mentioned above, scorers take  ¼ point off for every wrong answer. If a question totally stumps you, then you might consider skipping it. If you can confidently eliminate at least one answer choice as wrong, though, then you might benefit from guessing. The best way to do well on the SSAT is to develop solid quantitative, verbal reasoning, and reading comprehension skills. Since it’s a timed standardized test, though, practicing various test-taking and time management strategies is a useful approach too. In closing, let’s review the key points to remember about this private school admissions test. To Sum Up†¦ If you’ve made it this far in the guide, then you should have a good sense of the structure and skills tested across all three levels of the SSAT. Students in grades 3 through 11 can take the elementary, middle, or upper level of the testto apply to independent schools. The SSATis skills-based and seeks to measure your verbal, math, and reading skills. Each level also includes a writing section, which is unscored but will be available to admissions officers that you indicate as score recipients. The SSAT features similar question types at all three levels, with the upper levels incorporating more advanced concepts and vocabulary. The scoring systems are different, though, so you’ll need to familiarize yourself with the scale, as well as your prospective schools’ expectations, to set your target scores. Once you have a goal in mind, you should set aside time for several months to prepare. The earlier you start, the more time you’ll have to get ready. Plus, you might benefit from retaking the test once or twice to improve your scores. By planning early and studying with high-quality SSAT materials, you’ll see improvement and make progresstoward your target scores. While the SSAT is just one piece of your private school application, it can go a long way toward making you a strong candidate for your school of choice! What's Next? Want more help with SSAT prep? Check out our SSAT study tips and complete collection of SSAT practice tests. One of the best ways to improve your test scores is to analyze your mistakes. This guide explains how to reviewyour errors on practice tests so you can make big improvements for next time. Are you a younger student considering taking the SAT? Before you decide, check out these guides on whether or not you should take the SAT as a 7th grader, 8th grader, or 9th grader. Did you know that test scores are just one piece of your private school applications? You should also show admissions officers who you are and what you're interested in through your extracurricular activities. Check out this comprehensive list to explore hundreds of extracurricular activities! Want to improve your SAT score by 160 points or your ACT score by 4 points?We've written a guide for each test about the top 5 strategies you must be using to have a shot at improving your score. Download it for free now: