The Constitution of Malaysia

Malaysia is known for its richness of multicultural and multi-racial country which is spread between Peninsular Malaysia, Sabah and Sarawak. Despite being one huge political unit, it has different set of rules and law to comply with. Malaysia law can be classified into various sources, mainly are written law, unwritten law and Muslim law. Written law comprises The Federal Constitution which is the supreme law of the land and State Constitution, a range of constitutions regulating the governments of thirteen states in Malaysia.Second written law is the Legislation law which is endorsed by Parliament and Legislative Assemblies at the federal and state level respectively. Final source of written law is the Subsidiary legislation as states in the Interpretation Act ‘any proclamation, rule, regulation, order, notification, by-law or other instrument made under any Ordinance, Enactment or other lawful authority and having legislative effect’. Malaysia has huge amount of subsid iary legislation.Subsidiary legislation is referred to law made through powers delegated by the legislature mainly Ministers and local authorities. Only Subsidiary legislation made in a proclamation of emergency under Article 150 of the Federal Constitution is accepted , other breaching of either a parent Act or the Constitution is voided. Unwritten law under the Malaysian law is the law which is not written or found in Federal and State Constitutions. It is also not endorsed by the Parliament or the State Assemblies.Unwritten law comprises of Judicial decisions of the superior courts Principles of English Law and Customs law. Judicial decisions using the systematical method called `doctrine of binding judicial precedent` at the High Court, Court of Appeal and the Federal Court followed by Supreme Court can still be found in Malaysian law. Nevertheless the decisions made by Federal Court and Judicial Committee of the Privy Council are still binding on the present court. Binding or p ersuasive is a process of adjudication, this is after argument and before the judge reaches the conclusion.The judge will formulate and apply a legal principle in accordance with certain rules to form a guide for future. The judge will provide reason for reaching a decision or the legal principles behind the decision; this may bind other similar disputes in future. Binding precedents depends on the court’s position in the hierarchy of the courts. These are binding until they are reversed or overruled, where else persuasive precedents are those which are not binding authorities. Another important unwritten law is the Principles of English Law.It consists of Common Law and Equity. The common Law is the body of rules developed by the old common law courts of England which no longer exist. It is established on customs common throughout England. On the other hand, Equity is the body of incomplete rules developed as a supplement to Common Law to correct defects and to reduce the ha rshness. Even though English Law forms part of the Malaysian law, the facts and rules stated are only part of the entire law of English common law and rules of Equity.Principles of English Common Law and rules of Equity received and applied in Malaysia Legal System is by virtue of the Civil Law Act 1956 (Revised01972) . Under Section 3(1) of the Civil Law Act, 1995 states that in Peninsular Malaysia, the courts shall apply the common law of England and the rules of equity as administrated in England on 7th April, 1956. As for Sabah and Sarawak, the courts shall apply the common law of England and the rules of equity, together with statutes of general application, as administrated or in force in England on 1st December 1951 and 12 December 1949 respectively.Application of common law of England is subjected to two limitations; firstly Local law takes priority over common law. Common Law is applied only in the absence of local statues. It is only meant to fill up gaps in the legal syst em in Malaysia. Secondly, part of common law which suits the local circumstances is applied. Common Law was initially introduced to the Straits Settlements through Royal Charters of Justice which was then extended to the Malay states through administrative arrangements. Finally the third unwritten law of Malaysian law is the Customary law.Malaysia is known as a multi-religious country, the multiracial local population of Malaysia is also a source of law which has been accepted by the Malaysian courts. Mostly family law limits, namely marriage, divorce and inheritance are given legal force by the courts of Malaysia. In peninsular Malaysia, `Adat` applies to Malays, there are two main diversities of Malay customary, the adat pepatih and adat temenggong. Adat pepatih is mainly known for the matrilineal system where else the adat temenggong is a patrilineal system of law.As for the Hindu and Chinese, prior to the enforcement of the Law Reform Hindu and Chinese customary law is applied t o Hindu and Chinese respectively. The Law Reform includes abolishing polygamous marriages, since then, Chinese and Hindu customs have become minimal to almost no effect as a source of law in Malaysia. In Sabah and Sarawak, native customary laws apply in land dealing over native customary lands and family matters where natives subject themselves to native customary laws. Other indigenous people of Malaysia apart from Sabah and Sarawak are the aborigines.There is an aboriginal customary law for the aboriginal people under the law of Malaysia. In contrast to the source of law discussed previously, Muslim law or Islamic law continues to grow in importance as another source of law just like the written and unwritten law as part of Malaysian law. Government policies of absorbing Islamic values in administration by introducing Islamic banking and Islamic insurance where Muslim law and Islamic principles are applicable is part of the renaissance of Islam in Malaysia.Also the Federal Constit ution has provided that State has the power to administer Muslim Law. The head of the Muslim religion in State is the Sultan. Muslim law is applied only to Muslims and the courts which enforce Muslim law are the Syariah Courts. Malaysian Islamic law is of the Shafii school jurisprudence, as modified by Malay adat, which was discussed under customary law, Malay adat law. This Islamic law falls into two main categories; the primary and secondary sources. Primary sources are Qur’an which is the Word of Allah and Sunnah is rules deducted from the traditions.The secondary sources are more to the means of discovering the law rather than source. These sources are Ijma which is consensus of jurists of any particular era on a juridical rule and Qiyas which are the deductions from reasoning by ijtihad or analogy. Initially Islamic law was not included in the definition of law; this was even after the independence of the Federation of Malaya. Federal Constitution was declared as the sup reme law . Before amendment in 1988, Article 121 Clause (1A) Syariah courts were excluded.However, upon recommendation from Alliance Party, a provision was added to the original draft of Reid Constitution Commission where Article 3 of Federal Constitution declares that ‘Islam is the religion of the Federation’. Article 3 appeared with necessary qualification that ‘other religions may be practiced in peace and harmony in any part of the Federation’. However there are clauses to ensure non-Muslim’s civil rights are also not affected. At any official functions, Islamic way of prayers is being offered.Islam being the official religion of the federation has two main consequences, firstly, the government (federal or state) may lawfully establish or maintain, or assist in establishing or maintaining, Islamic institution, or provide or assist in providing instruction in Islam, and incur the necessary expenditure for these purpose. Secondly, through annual Su pply Acts and Enactments, may spend money on the administration of Islamic law. Also in some of the cases for marriages where a non-Muslim is involved, Islamic law takes precedence over the common law.The religion of a child from previous marriage is determined by the parents of the child , in the case of where the consent is not given the minor will remain in the religion of the parent at the time of marriage . Furthermore polygamy marriages are allowed with judicial permission dependent upon application and court hearing should be with the existence of wife or wives. Judicial permission is requested only upon permission granted for marriages by the existing wife or wives. As Muslim Law is one of the main sources of law in the county, Malaysia became a member of Organisation of the Islamic Conference (OIC) when it was established in 1969.OIC is a major organization of Islamic States that voices and coherent Muslim opinion on issues which are affecting the Islamic States. Other asso ciations where Malaysia is involved will be ASEAN where Malaysia was one of the first five countries to establish ASEAN in 1967. It was established to work together amongst the members of the association to speedup the economic growth, social progress as well as cultural development jointly to strengthen and prosperous with peaceful in amongst Southeast Asian Nations.Also to support regional peace and stability for justice and the rule of law in relationship amongst the member’s countries, making sure it adhere to the principles of United Nations Charter. ASEAN also provides assistance amongst the members in form of training and research facilities in the educational, professional, technical and administrative spheres. Other Malaysian involvement in reference to Asia-Pacific concerning economic growth is APEC which aims to support sustainable economic growth and prosperity in the Asia-Pacific region. This is done by multiple different encouragement and enhancements.Apart from regional involvement, Malaysia does have collaboration with particular country which may not be part of ASEAN or APEC to jointly enhance for the benefits of both countries. Malaysia has jointly signed agreement to work together in multiple areas with many other countries. Malaysia has been involved in relationship with countries like China and India since before independence was declared in 1957. Till today Malaysia has been maintaining the well established relationship especially with these two countries by getting into agreement in multiple collaborations.Chinese is the second largest race in Malaysia followed by Indian since they were brought in by the British Empire before independence. Chinese migrated to Malaysia vastly as coolies in tin mining industry and rubber plantation. Although it is said that Chinese have been in â€Å"Malaya† since Malacca Empire in 15th Century . Today, 25% of the country populations are Chinese which are made up of various dialect groups suc h as the Hokkien, the Hakka, the Cantonese, the Teochew, the Hainanese, the Hokchiu and etc. who have intermarried extensively with each other.The Chinese have dedicated media and publication exposure for example daily newspapers, dedicated Chinese language radio stations and daily broadcast from all terrestrial television stations . Till date Chinese communities still perform traditional art, the lion dance and the dragon dance mainly during Chinese New Year. Chinese New Year is declared as a national public holiday where there Chinese celebrate the New Year by fulfilling most of the tradition and cultural activities. However the fireworks or firecrackers are part of the Chinese culture which has been ban in Malaysia due to safety reason .For the Chinese, apart from the myth that says firecrackers are to frighten away the â€Å"Nian†, it also signifies a joyful time of year which is an important element of Chinese New Year celebrations . On the other hand, the Indians starte d migration to Malaysia for the purpose of plantation labour, traders, policemen and colonial soldiers. Some English-speaking Indians were also brought to work in the British colonial government . However just like the Chinese, it is said that the Indians have been here from more then 500 years ago.Initially the Arabs and the Indians mainly the Indian Muslims from Gujerat came to Malaya as traders and merchants. Now the Indian population in Malaysia is 8% which is made up from Tamil, Malayalam, Telegu, Punjabi, Bengali, Gujerati and etc. Just like the Chinese, Indians also have dedicated media and publication exposure of daily newspapers, dedicated Indian language radio stations and daily broadcast from all terrestrial television stations. This is mainly in Tamil language as 80% of the Indian communities are the Tamils (South Indians) .Diwali aka Deepavali is the most significant celebration of Indian community where national holiday is acknowledged for. Fireworks during Diwali are to mark several significant , however in respect to the law it is not legally practiced in this country. Another tradition not being legally practice is gambling under Act 495 Betting ACT 1953. Among other tradition obstructed by the Malaysian law is the architecture of a Sikh Gurdwara should not have a dome to avoid the Muslims to mistaken that for a mosque .

You Vs. Fast Food

Remember how simple it was to pull up to the drive through and tell the little speaker box what combo you wanted? You weren’t ashamed of asking for large fries and a chocolate milkshake because your stomach can handle anything you decide to digest. The salty golden arches crunched as you took a bite, the juicy double cheeseburger melted in your mouth or the sweet tea quenched your thirst and the hot fudge sundae sent you on a sugar rush. The teenage years were carefree because there was no distinction between healthy and life threatening when it came to choosing where to eat during lunch break. Unfortunately, your figure cannot handle careless food decisions anymore. Now you need to drive past that McDonald’s and find the nearest salad bar. Fast food is not your friend; it’s your enemy. Looking back you must wonder why you thought greasy cheeseburgers and fried chicken were the ideal meal; they certainly did not do any good for your body. Yes it was a quick and easy way to get food but that was during the years you stayed active. As a woman well over her thirties, you are smart enough to know that you don’t have the same metabolism as any eighteen-year-old girl. Face it, you are no longer that little girl who could devour her way through all you can eat buffets and midnight snacks. You are a mother who may have gained a few pounds here and there; nevertheless, you are not allowed to let yourself go. More importantly, do not feed yourself straight into a heart attack because you divert to fast food for dinner. A meat patty is made from the unhealthy parts of the beef. White bread will only make you want to eat again in a couple hours. The oil used to make your favorite value menu snack can eventually clog up your arteries if eaten excessively. Why risk your life for chicken nuggets that never look as good as the ones on the TV commercials? Don’t forget that you are no longer thinking of yourself, you have a husband and children. Are those deep fried onion rings really worth thousands of dollars toward hospital bills and the thought of your family losing its primary caretaker? Now you can pull up to the drive through teller and ask the little speaker box if it knows where the nearest Subway is because you have conquered your need for unhealthy fast food. Don’t let the golden arches confuse you, they are swords to the stomach and the milkshakes will only give you brain freezes. Stay away from that double cheeseburger because it is soaked in oil that leads to high cholesterol and heartburn. Don’t give in to the artificial sweeteners and chocolate because they satisfy you when you have them, but will only make you crash harder. You are stronger than any of the unhealthy products fast food throws your way. If you stay away from them all together, you will no longer have to worry about fast food taking you down. You will come out well figured, healthy, and victorious.

Statistical Methods Assignment Research Paper Example | Topics and Well Written Essays - 1000 words

Statistical Methods Assignment - Research Paper Example Since this is a weight reduction study, we did a one-directional t test. Results showed that the diet resulted in a significant decrease in weight, both for a 90% and 95% confidence level. In both cases, it is reasonable to say that two-thirds of the general population agrees with the principle of University top-up fees. The hypothesized p is included in both intervals. We, therefore, do not reject the null hypothesis. .. : 0.05 p = 2*0.0096 = 1 - 0.9808 = 0.0192 The test shows that there is a significant statistical difference between the sample mean and the hypothesized mean, on a 95% confidence level. We, therefore, reject the null hypothesis. Question 6 sample size 121 degree of freedom 120 sample mean 47.50 critical t 1.658 sample standard deviation 7.50 90% confidence interval (46.37, 48.63) Assuming that the population standard deviation is equal to the sample standard deviation, the confidence interval becomes: (46.38, 48.62) The two intervals do not seem to have a significant difference between them. This is a result of having a large sample size. As the sample size increases, the difference between the two intervals is also expected to significantly increase, resulting to large errors. Question 7 t ratio 3.364 alpha () critical t 0.05 2.306 reject H0 0.10 1.860 reject H0 In this test, we assume that the sample standard deviation approximates that of the population without any significant statistical difference. Since this is a weight reduction study, we did a one-directional t test. Results showed that the diet resulted in a significant decrease in weight, both for a 90% and 95% confidence level. Question 8 T 680 N 1050 T/n 0.648 p 0.667 standard deviation 0.228 Test Statistic 1.29 (1.29) 0.9015 p value 0.1970 95% confidence interval (0.619, 0.677) 90% confidence interval (0.623, 0.672) In both cases, it is reasonable to say that two-thirds of the general population agrees with the principle of University top-up fees. The hypothesized p is included in both intervals. We, therefore, do not reject the null hypothesis. Question 9 To estimate a population proportion p with a 95% confidence

Professional Development Report Research Paper Example | Topics and Well Written Essays - 5000 words

Professional Development Report - Research Paper Example The art of reflexive practice is the foundation for promoting a continuous learning cycle that improves knowledge and comprehension about one’s own talents and professional development (Paterson and Chapman 2013). This report utilises reflective methodology to assist in creating a relevant and well-defined Personal Development Plan inclusive of key concepts of professionalism development, personal development, and the extension of professional practice. The report makes detailed comparisons between teaching pedagogy and personal teaching ideologies to determine how this impacts teaching practice and underpins future strategy development in the classroom. In order to become fully self-actualised, the achievement of one’s greatest competencies and professionalism, it is necessary to reflect on one’s strengths and weaknesses whist recognising the vast amount of opportunities to become a more competent and efficient educator. Professionalism in the lifelong sector is viewed from several disparate perspectives. Troman (1996) views professionalism not as a set of absolutes, but as a socially-constructed ideology which is defined through managerial competencies with an emphasis on creating positive relationships with peers and other stakeholders. Fielding (2005) asserts that genuine professionalism in the educational sector is maintaining teaching integrity. Hence, professionalism, for the context of this report, will focus on professionalism in education as being inclusive of managerial competencies with a sociological emphasis and teaching integrity. An educator’s ability to articulate social awareness as an element of professionalism is to improve engagement quality with others (Brookfield 2012). To become a competent professional in this context, it requires a pedagogy that is inclusive of an emotional approach to the social dynamics of educational

The history of Money Assignment Example | Topics and Well Written Essays - 250 words

The history of Money - Assignment Example This is because it made the quantifying of value of goods and services easier. Traders required coins for buying and selling goods, and paying other services such as labor and transport (Davies & Bank 11). The other factor, which facilitated the spread of coin money, is the need for more slaves to work in manufacturing industries. Most of the products were hand made, and this implies that factory owners required more slaves to work in their factories. Factory owners, therefore, required coinage money to buy slaves, as it was the only legal tender available during that time in Greece and other neighboring nations (Davies & Bank 13). Many historians have developed several differences between the Roman Empire and the modern day America. First, the United States was founded on rebellion against British Empire in the name of self-governance and freedom (Davies & Bank 18). While Romans valued their status as masters of the known world, only a few Americans brag their own imperialism. In the ancient times, most people perceived Greece as the world’s superpower, and a nation living in democracy with the ideal liberty, life and happiness. In contrary, most people currently perceive the U.S. as nation trying to force its ways as the world’s superpower (Davies & Bank 19). In term of money, the ancient Roman Empire coin was one of the major trading currencies, along side other currencies such as Greek coin, and the U.S. dollar is also one of the major trading currencies alongside other currencies such s GBP,AUD and JPY (Davies & Bank

Why Individuals Find Change Difficult to Achieve Case Study - 1

Why Individuals Find Change Difficult to Achieve - Case Study Example As the discussion outlines, people accomplish personal change when they are willing to give up comfortable ways of thinking and acting. Change is ‘hardwired’ if an individual is attempted to it through training, efforts and some practical works. ‘Hardwired’, a term normally used in neuroscience, means that qualities are fixed and are in place when people are born; and these qualities are ready to be activated or triggered by their genetics or in response to their concerned environment. More specifically, people are hardwired if they do not serve willingness to a specific change, but they are ready to change due to special training or hard working on it. It is how change becomes difficult for some people. In attempting to change, often people need to use more information and intense energy in processing new materials. This in turn requires the brain to work hard. People use intense energy if they are less skilled or having less preference. This is also anothe r reason why individuals feel change a difficult attempt. The article stressed that change is always possible, but it needs efforts. Personal change is motivated by pleasure and avoidance of pain. Change is not hardwired when the individual has an aspiration toward a specific role and it requires greater influence. Avoidance of pain is a motivator as an individual is prompted to become compassionate or promoted and thus he tries to change. Personal change occurs only when an individual move through four steps; awareness, analysis, alternative and attack. First, the individual realizes that something is not working, and then reflects on what something needs to change. Next, the individual seeks alternative options for change and then he decides on a course of action. It is well documented from the research findings that individuals and organisations usually resist changes.

The Compatibilist and Moral Responsibility Research Paper

The Compatibilist and Moral Responsibility - Research Paper Example However, the above person must comply with the United States laws to avoid causing discomfort among the other members of the community. The law prohibits the person from using a microphone to sing at a very loud boisterous level. The act would irritate the nearby apartment dwellers’ sleeping patterns. Singing at the top of one’s voice at 12:00 midnight may anger the next room dweller who needs the silence because her 8 month old baby is sound asleep.               In terms of love, the same individual can freely court whoever he chooses. The same person is free to love someone from the African American race, Asian American race, and European American race.   Same person can court a 40 year old woman or an 18 year old lady. Some confessed homosexuals freely enter into love relations with persons of the same sex. In fact, gay and lesbian marriages are allowed in some parts our United States.   However, the individual cannot force the other person to accept the individual’s love overtures. The other person has the right to freely exercise one’s freedom to accept or reject the love overtures of the suitor or suitors.       In terms of education, any person has the freedom to enroll in any school of one’s choice. The individual can prefer to enroll in Harvard Business School.   One can enroll in London’s Metropolitan University. The same person can study in Washington .D.C. however, the preferred schools have the right to refuse certain student applicants.   The schools can refuse entry to students who do not pass the school’s standard entrance exams.            In terms of work, every individual has the right to apply for work. One can freely choose to apply for a vacant job in any United States government agency. Every person can freely submit one’s job application letter to the London air force.   One can even apply for a job as the bodyguard of the victorious Barack Obama. However, the company or Barack Obama has the freedom to accept or reject the job applicant’s application letter.

Negotiation Essay Example | Topics and Well Written Essays - 500 words - 4

Negotiation - Essay Example The functions of communication are another feature that is important within the context of the negotiation process. Facilitation of the exchange of ideas and opinions between the negotiating parties is one of the functions of communication in negotiation. The functions of communication interact with other features such as the rules and the objectives of communication to influence the achievement of the goals of the negotiation. Chronemics are a non-verbal feature of communication that interacts with the willingness and commitment of the negotiating parties to resolve their conflict. Chronemics encompass aspects such as punctuality and patience that are crucial to the successful completion of every stage of the negotiating process (Wood, 2008). Finally, intentions are an important feature of communication that can affect the direction and success of the negotiation. Intention interplays with interpretation because most negotiators assume that whatever their opponent does or says is purposive and is meant to communicate something. As such, there is need for negotiators to be fully aware of their intentions when saying or doing something in every stage of the negotiating process in order to avoid being construed inappropriately (Wood, 2008). Nicholas Anderson’s post is an insightful piece that presents quite accurate information on the modes of communication. The idea that written communication helps make up the shortcoming of verbal communication to come out as abrasive is correct because the person communicating has more room to read and correct what he or she has written wrongly. His assertion that verbal communication is the mode of communication that many people are familiar with is acceptable. However, he overlooks the idea that it takes much interest and attention to catch sadness or happiness in a person’s voice because some people do not announce these things explicitly but only imply them. Anderson’s idea on

Criminal Law doctrine and women who kill Essay Example | Topics and Well Written Essays - 4250 words

Criminal Law doctrine and women who kill - Essay Example Thus when women do not conform to the male-dominated sex role expectations of what it is to be a good wife, good mother and therefore a good woman, they are then considered to be 'doubly deviant' and punished for both their legal infringements as well as their refusal to conform to the female gender behaviour. This becomes all the more relevant while considering that the bulk of female homicides involve the killing of those closest to them that is, their spouses, lovers or infants thereby contradicting all concepts of motherhood, wife and woman. She further writes that when women kill it is typically not to terminate violence on their part, nor to gain any power over their male partners. Instead it is usually an attempt to get some degree of final and desperate control and relief for themselves from their abusive partner especially at that point when they realise that their very life is being threatened. Patricia Pearson, Toronto based author of the hard-hitting book on female violence When She Was Bad: Violent Women and the Myth of Innocence, says women get off the hook for violent crimes because society will not admit they can be predators. According to her some women are getting away with murder simply because they're women. She argues that legal defences, portraying the murdress in a battered-women's syndrome, and misogynistic attitudes are giving some women a social licence to kill and be violent because society considers it too intimidating to admit that women can be capable of ruthless crimes just like men. She writes that society would rather think ofviolent women as hopeless, weak or child-like creatures more likely to have been abused or being simply crazy. To prove her point she gives the example of women like the wicked Karla Homolka, who was guilty of helping to kidnap, sexually torture and kill three teenage girls, including her own sister. However, after winning a plea-bargained 12-year sentence she sat happily in her prison cell reading the books Battered Women and Perfect Victim. "It worries me when people begin to feel entitled to use violence because they've bought so deeply into the idea of their own victimization," Ms. Pearson said during an interview. "The whole idea of learned helplessness is, you're so helpless you can't walk out the door and therefore, somehow, you're able to discover the strength to shoot the guy in the head. I think a larger number of women than we realize get away with murder for a whole number of different reasons." "We don't want to take female violence seriously because I think we have our hands full with male violence and I think that we have an idea of women as being the people that you go to for your shelter. Out there in the mad and dangerous world at least you can go home at night to a sweet and comforting hearth. We can't accept the fact that we can't go home to a safe house." Ms. Pearson is highly critical of some feminists who, according to her, are trying to keep the issue of female violence hidden. This allows society to avoid admitting that women, like men, can commit violence for an elaborate variety of reasons, and not simply on account of madness or in self-defence. This also permits these feminists to continue depicting women as sufferers rather than predators. The silence on the issue, she says, is making sacrificial lambs out of men who are victimized by violent spouses, mothers and other women. "These guys are pariahs because we're

Lab report Essay Example | Topics and Well Written Essays - 500 words - 4

Lab report - Essay Example The results shows the values for Lethal Concentration 50 and Lethal Dose 50. From the table of Lethal Concentration 50, Ammonium nitrate is the most lethal most dangerous of the four compounds. This is because the compound has the lowest value and this means that it becomes lethal at lower concentration that the other compounds. the conclusion is valid because of measures that consider data on a uniform scale. All measures are with respects to rat and inhalation and this provides equal base for measuring effectiveness of the compounds. Sodium chloride is the next dangerous compound as it becomes lethal, to cause 50 percent deaths, at 42 ppm. Larger concentrations, more than 1000 ppm are however required for carbon tetra chloride and hydrofluoric acid and this means that the two compounds are less dangerous with respect to the test animal. The observation can therefore be inferred to other animals to the conclusion that, with respect to Lethal Concentration, Ammonium nitrate is the mo st dangerous of the compounds followed by sodium chloride. Data on lethal dose 50 however identifies the least value with sodium chloride, 3 mg/kg, and this means that the compound is the most dangerous of the four. Hydrofluoric acid follows this with a value of 25 mg/kg. carbon tetrachloride and Ammonium Nitrate however have very high values that indicates lower toxixity. The conclusion is further reliable, based on the data, because measures are taken on the same scale, in relation to a single animal species, and in relation to similar delivery mode. A difference is however noted in the trend of toxicity of the four compounds. while values for Lethal Cconcentration 50 identifies Ammonium nitrate as the most dangerous followed by sodium chloride, values of Lethal Dose 50 identifies sodium chloride as the most dangerous followed by hydrofluoric acit. A possible explanation to the

Understanding of Life after Death Essay Example for Free

Understanding of Life after Death Essay With reference to the topics you have investigated, examine and comment on the claim that the teachings of the new testament do not add anything of value to our value of our understanding of Life after Death. (50 marks) The claim that the teachings of the New Testament do not add anything of value to our value of our understanding of life after death is a very big claim to make. With reference to the topics I have investigated, 1Cor 15, St. Paul, Soma, The Soul, Dualism, Monism and the Empty Tomb, I will examine and comment on that claim. This claim is controversial because it has many objections from other scholars and many Christians. In 1 Corinthians 15 there are six key sections. The first of which is Christ’s Resurrection. Here Paul is keen to tell the Corinthians that he isn’t the teacher on life after death and that he is simply passing on Jesus’ message, because as we know, Jesus was the teacher and his apostles, which later included Paul after Damascus, were his messengers. The second section is the denial of the resurrection. Paul says that some people argue that â€Å"there will be no resurrection of the dead† and some scholars argue that this is not a theological argument, but Paul argues that the soul is immortal and not the body. Paul illustrates the theological implications of the objections from Corinth are that if dead men don’t rise, then Christ did not rise and Christian faith is empty. Paul continues to say that if Christ was not raised, then our preaching is useless. Clearly Jesus’ resurrection must have happened as the tradition has survived. The third section is all about the consequences of Christ’s resurrection. Barrett writes that â€Å"the resurrection of Christ is a pledge and proof of the resurrection of his people†. St Paul makes a direct link between Adam and Christ, Adam’s actions had far reaching consequences such as original sin and Christ’s Resurrection has too such consequence such as universal salvation. Paul goes on about two different orders, Christ and his believers. Morris argues that the Greek word for destroyed does not imply fighting, just that all rule, other than Christ, we will be rendered null and void. Section four is all about the Arguments from Christian Experience. V29 brings about an abrupt change in focus, and St Paul moves from Christ to Christian. Section five goes on about a bodily resurrection. St Pauls uses the miracle of the harvest and says that are bodies are â€Å"sown up† in corruption, dishonour and weakness, but it will be raised in incorruption, glory and power. Paul’s teaching of a glorified body is a marked difference from Jewish thought, as they expected an identical body. Section six and the last section is about the victory over death. This is where Paul made clear that those who rise will be different and not flesh and blood. Paul stresses the continuity present and future state with fourfold use of the word â€Å"this†. He emphasises that ‘this’ perishable and ‘this’ mortal will be clothed with imperishablity and immortality. In my opinion, 1Cor 15 doesn’t help the claim that the teachings of the New Testament do not add anything to our understanding of Life after Death because it tells us about how we can overturn death and destroy it. John Drane argues that Paul’s conversion on the road to Damascus, together with Jesus’ Passion, Death and Resurrection, led him to believe that he was truly living in the presence of God. From a close study of the New Testament, it can be argued that St Paul changed his belief about resurrection as time progressed. St Paul spoke about Parousia to the Christians. The Parousia is the final victory over evil, when Jesus rises again. Initially, St Paul held a strong apocalyptic view which was that all Christians will live until the Parousia, yet this was challenged by the Thessalonian Christians, as many of them began to die. St Paul then said that those who have died will be raised to new life at the Parousia. He then added that those who were still living at the end of time of the Parousia would be transformed at the same instant. St Paul then declared that this transformation would not be sudden, but a gradual change, beginning with conversion and ending with death, which would lead directly into a new existence in a spiritual body without the need for the Parousia to arrive first. Drane argues that the change in St Paul’s thinking represents a change from unrefined Jewish view to a more sophisticated position that owed a lot to the influence of Greek philosophy. The Greek Tradition is that the Hellenistic thinking originated from Plato who said that the soul is immaterial and does not occupy space. It therefore does not disintegrate. It is immortal. Whereas the Jewish view is that they believed that, in some way, the soul begins to perish at death, and the psycho-physical unity that was the person is re-created elsewhere. The question has been asked as to whether Paul ever believed in spiritual resurrection? Whether Paul did believe in a spiritual resurrection, then that would prove to help our understanding on Life after Death. Most scholars disagree with the notion that St Paul believed in a purely spiritual resurrection, as this is a very primitive Christian belief that has since been replaced with belief in a physical resurrection. However Carrier and Friedman maintain that there are a number of arguments to support this view. First, that St Paul experienced a vision on the road to Damascus, during which he was converted. Therefore, it is reasonable to suggest that the appearances were understood by Paul to also be visions, and not literally physical occurrences, as portrayed in the Gospel of Luke and John. For Paul used the same Greek word to describe the ‘appearance’ in both instances. Secondly, that in 1Cor 15, Paul writes of ‘perishable’ and ‘imperishable’ bodies; he also makes a distinction between things of earth and things of heaven. Because he doesn’t disclaim the popular belief that things of heaven are ethereal, it can be argued that the people at Corinth already accepted it. Therefore, it is ‘prima facie’ that it is reasonable to suggest that St Paul was implying that the ‘imperishable body’ was ethereal, and not physical. Furthermore, St Paul literally makes this distinction calling the perishable body ‘psychikos’ which means a natural body and the imperishable body ‘pneumatikos’ which is a spiritual body, and says that they both co-exist in one body. He says that the body we know, the body of flesh, is own only this other, second body, the body of the spirit, rises to new life. Finally, St Paul says, that â€Å"flesh and blood cannot inherit the Kingdom of God† because they are part of the perishable body, whereas it is an imperishable body that rises to new life. Yet these arguments have been outright rejected by the majority of scholars, who favour the idea that St Paul did actually believe in a bodily resurrection. So why does it seem so convincing that St Paul believed in a bodily resurrection? Scholarly debate has identified that firstly, Paul’s self-identified Jewish heritage precludes such a conclusion. Secondly, that the language Paul uses to describe the resurrection, most notably â€Å"soma†, emphasises the physical nature of the resurrected person. And thirdly and finally, Paul’s belief that Christians immediately went to be with Jesus upon their death, but still awaited a â€Å"resurrectio n† demonstrates that the resurrection being discussed was a physical one. I believe that there is no doubt that there is a strong Jewish background to Christianity. Carrier and Friedman ignore this background, arguing that because Christianity changed some Jewish beliefs, there is no part of Judaism that is informative to Christianity. The little regard that Carrier and Friedman exhibit for Paul’s Jewish background is in direct contravention of the importance Paul clearly places on it. Carrier again attempts to confuse the issue by arguing that, even if Paul was a Jew, only the Pharisees believed in a bodily resurrection. The Sadducees and Essenes did not. Moreover, Young argues that Pharisees stressed a literal resurrection of the physical body, which would be reunited with the spirit of an individual. By aligning himself with a Pharisaic background, Paul provides us with an important insight into the meaning he attaches the term ‘resurrection’; he believed in a physical resurrection of the body. â€Å"Soma† emphasises the physical. In his writing, St Paul uses the Greek word ‘soma’ to refer to the body. Importantly, he does not use it solely for referring to resurrection; strengthening the argument that when it is used to refer to resurrection, it will die; but it will also be resurrected. â€Å"Soma† is also mentioned in the NT but not referring to resurrection. In 1Cor 15:3, Paul says that his ‘soma’ is not present with the Corinthians, but his ‘spirit’ is; emphasising the physical nature of the ‘soma’. Barrett argues that Paul’s use of the word ‘spirit’ here colloquial rather than theological. In Rom 4:19, ‘soma’ is used to describe how the bodies of Abraham and Sarah were too old to be fertile; its physical nature, again, stressed. Accordingly, the very fact that Paul uses the term ‘soma’ to explain the resurrection demonstrates that he is referring to a physic al event that involves the body of the believer. Additionally, Paul uses the analogy of the seed, stressing the continuity of the earthly body with the resurrected ‘glorious’ body. In 1Cor 15:50-54 Sanders comments that immortality is ‘put on’ and replaces mortality. Paul was not thinking of an interior soul which escapes its mortal shell and floats free, nor the new life being breathed into the same body, but again of transformation, achieved by covering mortality with immortality, which it ‘ swallows’; emphasising the physical. Wright and Barrett argue similar points. My own personal opinion is that Paul believed more in a spiritual resurrection but he didn’t rule out a physical resurrection. In light of the statement I think that this is an influential part of our understanding of Life after death because it helps us understand which resurrection was more likely. The term ‘soul’ refers to ourselves, who earn rewards and consequences by coming to know, or failing to come to know, God by faith. We will come to earn blissful life in heaven, or eternal loss of heaven. Jesus’ parables clearly teach us that it is the same self judgement which faces judgement after death as the self who lived on earth in the body. There are three different theories about the soul. The first theory being the Theory of Origen. The soul existed in the heavenly realms before descending into this world, and that its present imprisonment in a material body is the result of a primeval fall from grace. This was never widely accepted, and rejected by the Church at the Council of Constantinople in 540 AD. The second argument is that of Traducianism. The theory that the soul-substance which God breathed into Adam has been passed down through generation after generation of his descendants by continual division. To some extent, this draws parallel with modern genetic science: everything comes from a gene pool. This was gradually abandoned by the Church. The third and final argument is that of Creationism. Each new soul is a new divine creation which God attaches to the growing foetus at some point between conception and birth. This was enshrined by the First Vatican Council, who declared that â€Å"God creates a new soul and infuses it to ach man†. However, Creationist thought is incompatible with the findings of modern science as it suggests that there are characteristics of the self that are derived neither from genetic inheritance nor from interaction with the environment; Dawkins would ridicule this theory, saying it was none-sense. Personally i believe that the soul is resurrected and moves on in life and that our bodies will rise up at the Parousia. Therefore it is an important aspect to our understanding of life after death. Monism is the theological view that all is one and this will help us understand Life after Death; human beings are made up of one substance and that what it is to be human can be defined in material terms because the soul cannot be separated from the body. Monism comes in a number of different forms: some argue that the soul and body are one, whilst others reject the concept of soul altogether and that the body is one substance on its own. People were beginning to speak of the soul as â€Å"the ghost within the machine [the body]†. Ryle argued that this was â€Å"a category mistake† as the language was being used incorrectly. By describing the soul in this way, the soul is being proposed as something ‘extra’ inside the body, which can physically identified within a person. Ryle argues that to talk of the soul is to talk about the way a person acts and integrates with others in society: it, therefore, is not separate and distinct. Dawkins perspective of Monism is that the view that we can only know what we are able to empirically verify. The soul does not exist separately from the body as it cannot be verified. This is known as Materialism. Linked to Dawkins is that he believed that humans are bytes of digital information; there is no soul as we are simply the sum of our genes. The soul cannot survive death, there is only the survival of DNA. Dawkins can be described as a ‘Harsh Materialist’ because he does not believe in life after death. He believes it is nonsense to talk of a life after death as one body is dead, it ceases to function. Dawkins claims that human consciousness has now fully evolved because we are now at a stage where we are able to predict the result of our actions, enabling us to choose how to behave. Therefore, humans continue to evolve because of the need to develop our memes (the way in which we mimic behaviour from other humans), not because of the genetic need to display our consciousness as a human race. I fell that this is important to our understanding of Life after Death because it allows us to see and understand the different attitudes to life after death. Soft Materialists still support monism but, unlike Harsh Materialists, they do believe in a life after death. The main supporter of soft materialism is John Hick, who proposes a replica theory. The strengths to this theory are, one, if you accept God’s omnipotent existence, then Replica Theory is perfectly plausible. Second, Replica Theory does not posit a soul, and so does not have to justify its existence. Thirdly, the Replica Theory answers the ‘conflicting claims’ argument because, according to Hick, everyone goes to heaven, regardless of their religion/beliefs. Fourth, the theory does not depend upon dualism and so is ‘acceptable’ to more people. Finally, in terms of logic, Replica Theory is possible. The criticisms of the Replica Theory are, one, Vardy challenges Hick by questioning whether the replicated being would be the same person. Is a ‘replica’ the ‘same’ as the original? Secondly, Vardy further argues that there is a break in continuity; for a person to stop existing in one place and be replicated in another there has to be a break in continuity of existence. So much so that the replicated person cannot be the same person. Thirdly, Williams simply argues that an endless life of replications would be increasingly boring and result in a meaningless life (an argument against Christian beliefs). Finally, logical possibility does not equate to factual possibility. Dualism however, is the idea that the mind and body are two separate substances. It is possible to survive death, as the soul disembodies. Human beings consist of both physical minds and that the mind is the essence of a person. This belief supports the immortality of the soul. Plato was a dualist who believed that the soul and body are two separate substances that interact with each other. Plato argued that the real identity of the person lies with the soul. He argued that the body and the mind are often in opposition; he saw the body as a nuisance and a bind. It is not the real person. Plato wrote â€Å"We may say ‘I have a body’ but not ‘I am a body’†. Plato believed that the real person is separate and distinct from the body it inhabits. The soul existed prior to being in the present body and, on death, will leave the body. The soul is on a higher level of reality than the body, being immortal with understanding of the realm of ideas. The body is concerned with the senses, the soul with reason. The soul is not always perfect because the body corrupts it and drags it down. Humans have the task of taking care of the soul, but this is easily corrupted. This helps our understanding of life after death because it gives us two sides of the argument for a spiritual or bodily resurrection and why they are both accepted. There is a wealth of scholarly debate on the historicity and significance of the empty tomb. The empty tomb will tell us if Jesus’ resurrection was bodily or spiritual, because he rose in body but then the robes were left perfect, as if to say that he floated up out of them, making it a spiritual resurrection. Arguments against the empty tomb detail are the fact that, St Paul gives the ‘official Christian list’ of resurrection appearances, without making a single reference to the empty tomb. Also, sceptics claim that the body of Jesus was simply stolen (i.e. not resurrected) or hidden by the disciples, making any post-resurrection appearances documented in NT nothing more than spiritual visions. The Swoon Hypothesis proposes that Jesus never actually died on the cross, but entered into a coma, from which he awoke whilst in the tomb, and so therefore never resurrected. Some go as far as saying that Joseph of Arimathea offering a tomb for the body of Jesus is an invention of early Christians who were desperate to make a bodily resurrection seem possible. Dawkins would concur this. If these arguments were to be accepted, then it would suggest that there was no spiritual resurrection, it was purely bodily, if there even was a resurrection. Arguments for the historicity of the empty tomb, i can be said, of the ‘stolen body theory’ Hick says that it would have been impossible for the disciples to do at Pentecost, less than 2 months after Jesus’ crucifixion; to have publicly proclaimed the resurrection in Jerusalem (within a mile or so of the tomb), if his body was still there and able to be produced. Brown argues that there was an understandable hostility in the early church toward the Jewish leaders. In Christian eyes, they had engineered a judicial murder of Jesus. Therefore, because Joseph of Arimathea was a part of the Sanhedrin that condemned Jesus, it is highly unlikely that he was a Christian invention (there is no reason why Christians would make up a story about a Jewish Sanhedrinist who does what is right by Jesus!). The empty tomb is reported by many independent early sources (incl. Mt, Mk, Lk, Jn, and Paul). Jewish historian Josephus reports that Jewish women were not even allowed to serve as witnesses in court; making it even more remarkable that it was women who discovered the empty tomb (surely this detail would have been omitted or changed if it were not true?!). My own personal opinion is that there was a resurrection, but going on the arguments given to us, I think that it was a bodily resurrection and that I would fall under the bracket of a monist. I believe that the New Testament teachings help us in our understanding of Life after Death because it teaches us about the body and soul, but I believe that it was a bodily resurrection because i believe the that the body and soul must have been working together as one to raise Jesus from the dead, because if it was one or the other then Jesus would have come back as a different person. Others would disagree with me because they feel that the bible is made up and that the historicity aspect is just coincidence and that it was a recent write-up of events of landmarks still existing today. This view fails because Johanine eschatology proves otherwise. The pool with five porticos still exists today, and that wouldn’t have been included in John’s gospel if it didn’t exist in John’s time. The eschatological aspect of it is that Jesus’ second coming will be at the Parousia when, we rise, bodily and spiritually to overcome death and evil.

Capm And Fama French Three Factor Model Finance Essay

Capm And Fama French Three Factor Model Finance Essay Shortly after the ground-breaking work of Markowitz on modern portfolio theory (1952) a new branch in Finance developed trying to explain the expected return on any financial asset. Soon the model with probably largest impact on the financial industry was born, the Capital Asset Pricing Model. Even after many different studies questioning the validity of the model, it is still the most used by practitioners. A lot of other models were subsequently developed on the same reasoning. Fama French Three-Factor Model is considered one of the most promising and consistent. We start this paper briefly explaining the CAPM and its shortcomings. On those grounds, we explain the Fama French model. Then, we test both models in US data from 1967 till now. Different portfolios were used, testing for the impact of size, book-to-market ratios, and the specific industry. We end up drawing conclusions on the results found. CAPM The Capital Asset Pricing Model (henceforth CAPM) has a very curious history, being built independently by Jack Treynor (1965), William Sharpe (1964), John Lintner (1965) and Jan Mossin (1966), all in the same time span of the early sixties. This work was based on the earlier revolutionary theory of Markowitz and also on Tobins Separation Theorem. The CAPM has several strong assumptions inherited from the said projects of mean variance efficiency that essentially create a perfect market environment. Investors are rational and risk averse, can borrow and lend unlimited amounts at the risk-free rate and have homogenous expectations and information about all assets returns. There are no taxes, inflation, transaction costs, no short selling restrictions and all assets are infinitely divisible and perfectly liquid. The assumptions constrain the setting for the CAPM world. They set a stage that only non-diversifiable risks are rewarded with extra returns, and since each additional asset introduced into a portfolio further diversifies the portfolio, the optimal portfolio must comprise every asset with each asset value-weighted. All such optimal portfolios comprise the efficient frontier. This makes the expected return of any asset or portfolio to vary linearly with the returns of the market portfolio, according to the following formula: Beta is the key measure as it gives the sensitivity of the excess returns of an asset or portfolio compared to the excess returns of the market portfolio. Since the unsystematic risk is diversifiable, the risk of a portfolio can be viewed as beta. The CAPM is best described by Sharpe (1988) as a simple, yet powerful description of the relationship between risk and return in an efficient market. This is a very intuitive thought process. The level of returns one expects to get is directly related to the exposure to market volatility. Stock specific error is diversified away when choosing the efficient portfolio, and as such the only source of return comes from choosing the relation your portfolio has with the market. The CAPM is so important that the standard deviation of a stock return no longer was the normally used risk measure, but rather its relation to the market returns. It is also the number one tool to find discount rates for company valuation and for portfolio management. However it has not been free of criticism. CAPM criticism After it was proposed, empirical tests were executed normally running the following regression: Where a proxy of excess market returns is used and regressed against a certain asset return. The Alpha of the regression indicates the excess return (either positive or negative) that is not explained by the CAPM. According to CAPM, as the correlation with market should completely explain its return, the apha of the previous regression should be 0. First of all, the use of a market proxy leads to Richard Rolls critique (1976). It is quite simple but revealing and it simply states the CAPM can never be tested as the exact composition of the market portfolio is not known. All proxies used might be mean variance efficient but the market might not, leading to all tests being inherently biased. Besides, the interpretation of Beta using market proxies leads to relative measures of risk, as the Beta obtained depends on the market proxy used. Besides Rolls opinion on the theory, a number of anomalies were found on the model. Characteristics such as size, earnings/price, Cash flow/price, book-to-market-equity, past sales growth had effects on average returns of stocks. These are called anomalies as they are not explained by CAPM, leading to the idea that risk is multidimensional and as such the CAPM is fundamentally wrong in its core conclusion. Eugene Fama and Kenneth French (1996) made the greatest stride, when stating that anomaly variables include a risk premium contained in the characteristics of these variables. These anomalies are mainly divided by two main factors. Size, which they explain theoretically, and relative distress, passing through the E/P and book to market as measures. Fama French Three-Factor Model Eugene Fama and Kenneth French since expanded the CAPM to the Fama-French (FF) tri-factor model (1992), which adds two variables to capture the cross-sectional variation in average stock returns associated with market: Beta, size, leverage, book to market and earnings-price ratio. This creates the following model: , which can be transformed into Where the factors added to the CAPM are the SMB (Small minus Big), a measure of the historic excess return of small caps over big caps, and HML (High minus Low), the same difference for returns of value stocks over growth stocks. This model is not as widely used as the CAPM, but we will test empirically if it performs better than the original one-factor model. Methodology After introducing the theoretical bases of these models, we will explain the methodology we used on our tests. We used data from Kenneth French ´s website, consisting of market excess returns from NYSE, AMEX, and NASDAQ firms and the values of returns from all those companies divided into size and book to market quintiles and also divided into five sections of industries Consumer Goods, Manufacturing (energy and utilities), High-tech, Healthcare and Service industry. The data is monthly from 1967 to 2010. Our variables of interest comprise the alphas of each regression (i.e., returns unexplained by the model) and the adjusted, which adjusts for the number of explanatory terms in a model unlike the regular, the adjusted increases only if new variables improve the model. We used all this data to run the normal empirical test regression expressed in (2). We will ignore Rolls critique in the tests and use a certain market proxy as in our opinion data on returns of a certain index representative of the country where investors negotiate is quite representative of market returns, as that data is amply divulged and influences all assets related. Results These are the results in regression form and the values of the alphas obtained with double standard error bands: Table 1 Regression Results from Size Portfolios (Values in parenthesis refer to the t-stat of the variable above) Looking at the alpha values of the regressions under the CAPM, the 4th quintile is the only one significant on a 95% confidence interval. All the beta values are significant and different than zero. Alpha values decrease as we go from portfolios of smaller to bigger companies, as does the of the regressions. As for the Fama French model, the values of factors are significant in all the size regressions, and the alpha value is only significant in the 5th quintile of biggest companies. The follows a similar behavior. These results seem to favour the tri-factor approach, as including the SMB variable seems to improve the quality of fit of smaller companies. The difference in the adjusted of the lowest 20% quintile between the CAPM and Fama French models is a whopping 30%, indicating that some unsystematic risks, captured by the difference between big and small firms, affect returns. In other words, these results favor Fama and French ´s model in explaining returns over the CAPM. Chart 1 Plot of CAPM alpha with double standard error band Chart 2 Plot of FF alpha with double standard error band These charts tell a more interesting story. The alpha values of the CAPM diminish a lot when going from small cap quintiles to large cap ones, from relatively high alphas to close to zero. Everything changes when using FF three-factor model where the alpha values are negative for small caps and go to positive when moving to bigger companies. The larger range of alphas in the CAPM over FF, especially in smaller companies, again indicates that returns are not fully captured by measuring only correlation with the market. Accordingly, by adding SMB this range is considerably reduced, especially in the portfolios based on the lowest 20% companies in size. Table 2 Regression Results from Book-to-Market Portfolios (Values in parenthesis refer to the t-stat of the variable above) Here the Betas of all regressions are significant. The fourth and fifth quintiles on the CAPM present a high alpha rejecting the null hypothesis that they are not significant, with a 95% confidence level. On the other hand, the FF model rejects only the lowest 20% B/M portfolios, and by the tiniest of margins. These results show evidence that Fama and French were indeed correct by considering the HML factor in their regression. In fact, the existence of significant alphas in the two highest quintiles in the CAPM, combined with the substantial differences in the adjusted 13% for the 4th quintile, almost 20% in the 5th again demonstrate that CAPM is not considering important variables in determining returns. Chart 3 Plot of CAPM alpha with double standard error band Chart 4 Plot of FF alpha with double standard error band As the B/M values increase, CAPMs results are ever worse regarding alpha. By adding double standard error bands, CAPMs portfolios based on the highest 20% value have alphas ranging from 0.1 and 0.6, very substantial values. FF performs much better, with alphas not moving far away from 0. Table 3 Regression Results from Industry Portfolios (Values in parenthesis refer to the t-stat of the variable above) Chart 5 Plot of CAPM alpha with double standard error band Chart 6 Plot of FF alpha with double standard error band Contrary to the previous analysis, the three-factor model only displays marginal improvements in the adjusted to the single-factor model when dealing with industry-based portfolios. In fact, the FF model has significant alphas in two different industries Health Care and Others while the CAPM has none. Moreover, the SMB variable seems to be irrelevant in the Consumer Goods and in other industries. We should not be surprised by these results, as the FF model was built around two ideas: small companies and those with high B/M ratios were undervalued by the market. Thus, when analyzing portfolios based on different restraints (like industry) the model will not perform much better compared to the CAPM. A note on Fama-French Three-Factor Model The FF model is an extension of the CAPM model in the sense that it uses two extra factors: SMB and HML. The first one increases the modulation of different size portfolios. The second one addresses the difference in book values of companies included in different portfolios. We suspect that SMB is in fact important whenever we are trying to predict the different performance of portfolios split using size as the criteria. The same reasoning can be used to portfolios split using book-to-market ratio as the criteria. We decided to apply this idea to the data, computing the average contribution of each factor to the total excess return of each portfolio. The resulting table is presented below. Table 4 Factor Contribution to Excess Return We can see that, as we suspected, SMB is in fact very relevant (19% on average) to explain the excess return of different portfolios split with market size criteria. That is even more critical when we are considering portfolios of smaller stocks. In those portfolios, the factor HML is not particularly important. When we move to book-to-market value different portfolios, it is HML that contributes significantly (14%), especially to high book-to-value stocks, and SMB can be neglected. Finally, when the criterion to split portfolios is neither size nor book-to-market, the two extra factors of the Fama-French model have no explanatory power on average. We can see the average weights are very close to standard CAPM. We can speculate on the difference across industries: for instance, hi-tech and health care stocks tend to have higher book-to-market ratios, and so the HML factor is relevant. It is possible that a factor like high dividend yield less low dividend yield might be robust to explain performance differences among portfolios split according to dividend yield level. We are not questioning the applicability of the Fama-French model. What we are addressing here is that each factor does not have a generalized relevant contribution to explain excess returns. In certain situations, like small cap portfolios and growth stocks, each factor in turn becomes very important. Outside of these native environments, the factors do not contribute to explain or predict excess returns. Final Remarks Throughout this work we have shown that Fama and Frenchs tri-factor model is superior to the CAPM in capturing some non-systematic anomalies not considered by the simple one-factor approach. These anomalies include the undervaluation of small firms and those with high B/M ratios. Adding variables that reflect this effect considerably improves the quality of fit of the model and eliminates loose ends as reflected by the significant alphas present in some portfolios using the CAPM. However, we must pay close attention to data, as performing a FF regression on data that does not reflect these variables, as industry does not improve the models. References and Other Bibliography Fama, E. F., French, K. R. (1992). The Cross-Section of Expected Stock Returns. The Journal of Finance, 47(2), 427-465. Fama, E. F., MacBeth, J. D. (1973). Risk, Return, and Equilibrium: Empirical Tests. The Journal of Political Economy, 81(3), 607-636. Lintner, J. (1965). The Valuation of Risk Assets and the Selection of Risky Investments in Stock Portfolios and Capital Budgets. The Review of Economics and Statistics, 47(1), 13-37. Markowitz, H. (1952). Portfolio Selection. The Journal of Finance, 7(1), 77-91. Mossin, J. (1966). Equilibrium in a Capital Asset Market. Econometrica, 34(4), 768-783. Roll, R. (1977). A critique of the asset pricing theorys tests Part I: On past and potential testability of the theory. Journal of Financial Economics, 4(2), 129-176. Sharpe, W. F. (1964). Capital Asset Prices: A Theory of Market Equilibrium under Conditions of Risk. The Journal of Finance, 19(3), 425-442. Treynor, Jack L. (1965). How to Rate Management of Investment Funds. Harvard Business Review, 43(1), 63-75.

PepsiCo Buyer Behaviour Analysis

PepsiCo Buyer Behaviour Analysis Buyer Behavior for Consumer Market Introduction In the summer of 1898, In New Bern, North Carolina, a young pharmacist named Caleb Bradham began experimenting with combinations of spices, juices and syrup trying to create refreshing new drinks to serve his customers. He succeeded beyond expectations by inventing new beverages know as Pepsi-Cola. Nowadays, Pepsi is a well known soft drink in all over the world. From its humble beginnings over a century ago, Pepsi-Cola has grown to become one of the best-known, most-loved products throughout the world. And the company behind it PepsiCo has grown as well, standing today as the premier marketer of refreshment beverages, juices and snack foods. They have consumer in over 200 countries in the whole world. The company offers more than 500 beverages and snack that appeal to every age of consumer age group and demographic category. Today, PepsiCo is a $29 billion company, employing more than 150,000 people speaking more than 40 languages around the globe. The company is consistently recognized for its corporate citizenship, philanthropic efforts and diversity programs. It is the worlds fourth-largest food and beverage company and is staking its claim as the global leader in convenience foods and beverages. PepsiCo has a strong plan to continue to expand with an enormous lineup of convenience foods and drinks that provide great taste, nutrition and fun around the clock. Here is the list of Pepsi Co brands and products. Mirinda, 7UP (International), Pepsi Limà ³n, Kas, Teem, Pepsi Max, Pepsi Light, Starbucks Doubleshot (Partnership), Starbucks Doubleshot, Energy (Partnership) Starbucks Iced Coffee (Partnership), Tropicana Twister, and Mountain Dew. Model of Consumer Behavior Consumer makes many buying decision every day. Many large companies do some research about consumer buying decision in great detail to answer questions what will customer buy, where they buy, how much they, when they buy and why they will buy those product. According to Principles of Marketing, Kotler (2008) Consumer Buyer Behavior refers to the buying behavior of final consumer which are individuals and households who buy goods and services for personal consumptions. The entire final consumer combines to make a consumer market. Many big companies did a lot of marketing effort to attract the consumer to buy their product. For example, Pepsi Company. The company did a lot of marketing effort to attract the consumer such as advertising, survey, promotion and apply the 4 Ps to make the consumer aware about their product. The question here is, how did the consumer respond to the various marketing effort that Pepsi company use? Model of buyer behavior consist of Marketing and other stimuli, Buyers black box and Buyer Responses. Marketing and other stimuli will enter the consumers black box and produce certain responses. So marketers need to figure out what is in the buyers black box. Marketing stimuli consist of the Four Ps which are Product, Price, Place and Promotions. Other stimuli included major forces and events in the buyers environment such as economic, technological, political and cultural. All the inputs will enter the buyers black box, where they are turned into a set of observable buyer responses. Under buyer responses there are product choice, brand choice, dealer choice, purchase timing and purchase amount. Consumers do not make their decisions in a void. Their purchases are highly influenced by cultural social, personal, and psychological factors. Here some of that influence the behavior or the particular market: Cultural Factor Cultural factor divided into three sub factors Culture, Sub Culture, Social Class. Culture is the set of basic values perceptions, wants, and behaviors learned by a member of society from family and other important institutions. Culture is the most basic cause of a persons wants and behavior. Every group or society has a culture, and cultural influences on buying behavior may vary greatly from country to country. Based on the case study, we are doing a Pepsi brands in Malaysia. Malaysia has many races of people such as Malay, Chinese, Indian and many more. Now days many people choose to drink Pepsi because it is Halal and did not contain any alcohol. It is because most culture in Malaysia did not allowed them to drink alcohol. So for teenager of adult who cannot drink an alcohol drink, they can choose to drink Pepsi. Other than that, now day culture in Malaysia more shift towards greater concern about health and fitness. This had brought a lot of huge industry for health fitness services, more natural foods and variety of diets. So for Pepsi company which serve soft drinks, they had come with a new products known as Pepsi Max which has less sugar and gas to fulfill the new culture of Malaysian people. Sub Culture is a group of people with shared value systems based on common life experiences and situations. Each culture contains smaller sub cultures a group of people with shared value system based on common life experiences and situations. Sub culture includes nationalities, religions, racial group and geographic regions. Many sub culture make up important market segments and marketers often design products. For Pepsi company, sub culture is very important in influencing the consumer to buy their products. They need to target consumer based on their nationalities, religions, racial group and geographic regions. For nationalities, Pepsi must aware about any country that did not allowed their people to take soft drinks. For example, India. They had once ban Pepsi in their country because of the sugar contain in Pepsi. According to Marketing, Kotler (2008), Many subcultures make up important market segments, and marketers often design products and marketing programs tailored to their needs. Pepsi should not make an advertisement which can touch the sensitiveness of any religions, nationalities and others. Social Class Almost every society has some form of social structure, social classes are societys relatively permanent and ordered divisions whose members share similar values, interests and behavior. Social class did not determined by a single factors such as incomes, but it measured as a combination of occupation, income, education, wealth, and other variables. Marketers are interested in social class because people within given social class tend to exhibit similar buying behavior. Social Factors A consumers behavior also is influenced by social factors, such as the Groups, Family, Roles and status. Groups are two or more people who interact to accomplish individual or mutual goals. A persons behaviors are influenced by many small groups. Groups that have a direct influence and to which a person belongs are called membership groups. Some are primary groups includes family, friends, neighbours and coworkers. Some are secondary groups, which are more formal and have less regular interaction. These include organizations like religious groups, professional association and trade unions. For groups, it is much easier for Pepsi to attract them to buy their products. Because a single member of the groups can influences almost all the group member to follow them. For example, a leader in one group can influenced the members to buy Pepsi as part of the group activities. Family members can strongly influence buyer behavior. The family is the most important consumer buying organization society and it has been researched extensively. Marketers are interested in the roles, and influence of the husband, wife and children on the purchase of different products and services. In this social class, Pepsi need to target the children because they are the people who will consume more Pepsi. But of cause they will ask their parents to buy the products. So Parents is the customer and Children is the consumer. Roles and Status is a person belongs to many groups, family, clubs, organizations. The persons position in each group can be defined in terms of both role and status. For example, Mdm Airis plays the role of Mother, in her family she plays the role of wife, and in her company, she plays the role of manager. A Role consists of the activities people are expected to perform according to the persons around them. Personal Factors Personal factors consists of Age and life cycle stage, Occupation, Economic situation, Life Style, and Personality and self concept. Age and Life cycle Stage is People changes the goods and services they buy over their lifetimes. Tastes in food, clothes, furniture, and recreation are often age related. Buying is also shaped by the stage of the family life cycle. Here Pepsi cannot target the all age of people to buy their products. They should target consumer from children, to teenagers and finally the adults. Because nowdays many people concern about their health. So they will try to avoid any soft drinks that have a lot of sugar and gas. This will affect their health. Occupation is a persons occupation affects the goods and services bought. Blue collar workers tend to buy more rugged work clothes, whereas white-collar workers buy more business suits. A Company can even specialize in making products needed by a given occupational group. Thus, computer software companies will design different products for brand managers, accountants, engineers, lawyers, and doctors. From here we can conclude that only working people can purchase Pepsi products. But not every one of them will purchase Pepsi. So Pepsi need to find a thing or a person to influence them. For example, advertisement is the best tools to influence them or for parents, children are their best factors to influence them to buy Pepsi products. Economic situation is a persons economic situation will affect product choice. Life Style is a persons Pattern of living, understanding these forces involves measuring consumers major AIO dimensions. For example, activities such as Work, hobbies, shopping, support. Other than that interest, Food, fashion, family recreation and opinions about themselves, Business, Products Personality and Self concept each persons distinct personality influence his or her buying behavior. Personality refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to ones own environment. Psychological Factors Psychological factors consist of Motivation, Perception, Learning, Beliefs and attitudes Motivation. Motive drives a need that is sufficiently pressing to direct the person to seek satisfaction of the need. Perception, The process by which people select, Organize, and interpret information to form a meaningful picture of the world. Learning is Changes in an individuals behavior arising from experience. Beliefs and attitudes. Belief is a descriptive thought that a person holds about something Attitude, a Persons consistently favorable or unfavorable evaluations, feelings, and tendencies towards an object or idea. Marketing Research Technique INTRODUCTION According to Malhotra (1996), Market Research can be defined as a key element within the total field of marketing information. Its links the consumer, customer and public to the market through information which is to identify and define marketing opportunities and problems generate, refine and evaluate marketing actions while improved the understanding of marketing as a process and of the ways in which specific marketing activities can be made more effective. This is for the reason that its always incorporates some form of the data collection whether it is secondary research (often referred to as desk research) or primary research which is collected direct from a respondent. While based on the case study we know that Pepsi Co is one of the most famous company that produce soft drink and some other product. Subsequently to get the information about Pepsi Co we need to do the market research so that we will know how far the customer or consumer is satisfied with the Pepsi product as well. This is because without the market research they might be tough for Pepsi Co to know about the level of satisfaction of their customer towards their product that has been produce by them. Consequently to get the work become more efficient we will follow the step on market research which is the first step is we will apply the web site method to get the first condition and perception about the Pepsi Co. This is because through the web site method we will get extra information such as the impression, background, financial and so on about the Pepsi Co. Next we will make some preparation on preparing the questionnaire about Pepsi Co which is in the questionnaire include some of the question about how society get know about the Pepsi Co and how much they spend to buy Pepsi product. On top of that the 20 sheet of questionnaire has been distributed towards the people around the Kuala Lumpur Convention Center (KLCC) which is the trendiest place that all people knew bout it. The data analysis will analyze by 20 people around there with the different age and occupation. Finally the data that has been collected will be prepared and presented in the best way. Primary data collection can be considered as one of the extra sources because is needed when a researcher cannot find the data needed in secondary sources. Market researchers are interested in primary data about demographic, socioeconomic, characteristics, attitudes or opinions or interests, awareness or knowledge, intentions, motivation, and behavior. Three basic means of obtain by primary data are observation, surveys, and experiments. The choice will be influenced by the nature of the problem and by the availability of time and money. SURVEY According to Business Dictionary.com (2009), Survey can be defined as the collection of data from a given population for the reason of analysis of a particular issue. Data that frequently collected from a sample of a population, knows as a sample of survey. As we already informed surveys is one of the ways that are used widely in research, especially in market research to find some information or any feedback from others towards some product. Besides that there have 4 types of survey which is include personal interview, self-administrated surveys, telephone interviews and direct observation. In order to collect the information of Pepsi Co we were applying 2 types of survey which is personal interview and self administrated surveys which are made by us as well. Personal Interview According to Business Dictionary.com (2009), Personal Interview can be defined as a market research technique for gathering information through face-to-face while contact with individuals. Personal interviews take place in a variety of place like settings-in homes, at shopping malls, in a business office and so forth. One of the personal interviews is face-to face interviews which is this interview are conducted between a market researcher and a respondent. Then the data is collected on a survey. Some surveys are very rigid or structured and use closed questions. So that the data is easy to compared with others. Further about face-to-face interviews is more in strength, and depend upon more open forms of questioning. The research will investigate and develop points of interest. While based on the case study, we were takes place in KLCC to do the research up about the Pepsi Co which is the trendiest area in the Kuala Lumpur. We chose this place because on a daily basis there is more people visit that place and most of them are from people around the Malaysia. Consequently we use the face to face interview because easy to get feedback from them and we can get the information on the spot. On top of that Pepsi Co can get directly more explanation from them because they can through out what they felt about the product that has been produced by Pepsi Co. Self-Administrated Surveys A self-administrated survey is one in which the respondent completes the survey on his or her. While as we know Questionnaires are usually printed on paper, but they might be in other ways like programmed into computer and places on the internet and ask for the respond. However, Self-administrated questionnaires present a challenge to the marketing researcher because they really on the efficiency of the written word rather than the skills of the interviewer. Self-administrated surveys are attractive because they are low in cost, and they avoid interviewer evaluation apprehension or worry. While based on the case study, when we do the survey about Pepsi Co we would just used pen and a paper to make the survey complete. Instead of that the people that has been ask for complete the survey questionnaire will directly respond on the questionnaire. Consequently we can get the result of the information directly of the questionnaire which is has been complete by the respondent. Telephone Interviews Telephone interviews also can be consider as one of the techniques that can be done to make our survey complete which is telephone interviews is also one of the key under the survey method. Telephone interview can be defined as an interview that gathers information through telephone contact with individuals. This means that the interviewers will call their respondent to get the feedback or respond from their customers. As a result the information that gathers would help us as well to make changes towards our product that has been survey. Direct Mail While surveys also can be made by using the direct mail which is the interviewers will send the questionnaire through the email so that the respondent can give the feedback form there using the mail responded .Example like company A which is the interviewer and in order to evaluate their performance towards society they will try to make and Direct mail interview which is they will send some question that will be in questionnaire and may be might ask about their company services that has been provided to society and they will sent the questionnaire to Company B which the interviewee. On this cases the company will receive the questionnaire form in direct mail from the Company B. So as the respondent Company B will return the answer also in mail form which is they will send back to Company A Through this method its give lots of pros towards the company which is can save cost in order to prepared the questionnaire because through the direct mail its the company can save cost OBSERVATION The market research technique is not just only based on the survey method, this is because Observation also one of the method that can be used to collect the information on the level of satisfaction towards Pepsi product. Observation can be easily defined as the systematic process of recording the behavioral patterns of people, object and occurrences without questioning or otherwise communicating with them. Observations can be divide into two types which is having as human observation and mechanical observation. As a Marketing Research officer for Pepsi Co we were use both types of observation to know what behavior of people or society towards the Pepsi Product. Observation as a methodical process of recording the behavioral patterns of people, objects and event without questioning or else communicating with them. Observation can be divides into two types which are as the chart show above two types of observation is Human observation and Mechanical observation which is can be implementing by Pepsi Co in order to observe their customers. Human Observation Human observation can be defined as self explanatory, using human observers to collect data in the study. We can do the observation by human observation. It means that we use human as the observers which is we can just look and interpret what they do, what feeling are they, or else from their body languages. We can know what their feel now such as happy, enjoy, bored and so forth towards the product of Pepsi. Other than that through the human observation the best technique that can be implement by the Pepsi Co to evaluate their customer feelings is through facial reaction of the customer which is can be in their smiles, raised eyebrows an head nods as well. As a result we can automatically analyze how the customer sense towards the product of the Pepsi. Besides that Pepsi Co also can used the direct observation in order to observe the customer of their product. Which is they can straightly observe the customer behavior towards the Pepsi product Mechanical Observation Mechanical observation involves using various types of machines in order to gather the information, data, which is then interpreted by researchers. On a daily basis we are already know that with the continuing improvements in technology, there are lots of mechanical ways that can be used in order to capturing data in observation studies however, these new gadgets tend to be extremely expensive. The most commonly used and least expensive means of mechanically gathering data in an observation study is a video camera. A video camera offers a much more precise means of collecting data than what can simply be recorded by a human observer. Based on the case study we know that in order to observe the customer we can implement the other ways which is like Mechanical Observation as a Marketing Research Officer we try to look forward on the ways of implementing the mechanical observation this is because they will make our work become more easily with the observation for employees or customers of the Pepsi Co. Otherwise Pepsi Co can used the CCTV which is to get the information without knowing by other people. Example that can be stated at here is like Pepsi Company in order to observe their employees in all departments like marketing department, chemical department which is this entire department were play and important role while producing and made the product Pepsi. Consequently we can see the action that shows by them is humble, lazy, and friendly and so forth. Indirectly, Pepsi Co can manage or take an action towards the employee which is not performing effective and efficient towards their work. Other than that we also can used the Video in order to observe the behavioral of the customer while the purchase the Pepsi product and we can see how they felt either satisfy or not which the number of purchase. Conclusion While based on my point of view the conclusion that can be made at here is survey is a type of research which is comparatively costly, because it requires a staff of interviewers, but it provides the best opportunity to obtain information through probing for clearer explanations. Consequently, we can know what people in KLCC feel about the Pepsi product. This is because the respondent can tell us what they feel. Ultimately, we can know either they satisfy or not about the performance of the Pepsi product or not. Besides that the personal style (tone of voice, rewording of a question) and biases of each interviewer can affect how the participants respond and how the responses are recorded. As a result, we can get information from our recorded such as from video recorded. While from mechanical observation, we must spend more time to get the information. At the same times, we cannot observe the feeling of people in this campus because we cannot ask then but just take their photo or vide o. On the whole, for us, survey is the best technique to use early on in the research process when the researcher is not yet sure which questions need to be asked, because new and better questions can come out of the dialogue. SWOT ANANLYSIS Introduction According to Businessdictionary.com (2009), secondary data is an existing primary data that was collected by someone else or for a purpose other that the current one. It depending on whether the data come from inside and outside the organization needing to research. In secondary data, it divided into two parts of sources such as internal and external secondary data. Internal secondary data are data that have been collected and exits inside the business firm or other organization. External secondary data is data from outside that firm. According to Business Dictionary.com (2009) SWOT is a tool that identifies the strengths, Weaknesses, Opportunities, and Threats of an organization. Specifically, SWOT is a basic, straightforward model that assesses what an organization can and cannot do as well as its potential opportunities and threats. The method of SWOT analysis is to take the information from an environmental analysis and separate in into internal such as strengths and weaknesses and external issues such as opportunities and threats. Once this is completed, SWOT analysis determines what may assist the firm in accomplishing its objectives, and what obstacles must be overcome or minimized to achieve desire result. Based on case study, to be comes a strong business strategy, Pepsi Co can used SWOT analysis that helped it become stronger competitor in other way Pepsi Co must identify which is their strength, weakness, opportunity and threat? SWOT Analysis of PEPSI Co The Pepsi Company is a leading manufacture, distributor and marketer of non-alcoholic beverage concentrates and syrups, in the world. Pepsi has a strong brand name and brand portfolio. Business-week and Interbrain, a branding consultancy, recognize Pepsi as one the leading brand in their top 100 global brand ranking in 2006. The business week-interbrain value Pepsi $67,000 million in 2006. Pepsi ranks well ahead of its close competitor Coco-Cola which has a ranking of 22 having brand value $12,690 million the companys strong brand value facilitates customer recall and allows Pepsi to penetrate markets. On the other hand, the company is threatened by intense competition which could have an adverse impact on the company market share. Strengths Strong brands allow the company to introduce brand extension such as Pepsi max, Pepsi Cola, Pepsi Twist, Pepsi Diet, Pepsi Light over the year; the company has made large investments in brand promotion. Consequently, Pepsi is one of the best recognized global brands. The companys strong brand value facilitates customer recall and allows Pepsi to penetrate new market and consolidate existing ones. Pepsi has been a complex part of world culture for a very long time and they take a good qualities control of their product by take important on qualities processes n also procedures to maintain their customer satisfaction. They have a unique product image and the products image is loaded with over-romanticizing and this is an image many people have taken deeply to heart. The Pepsi image is displayed on T-shirts, hats and collectible memorabilia and many more. This extremely recognizable branding is one of Pepsis greatest strengths. It allows them to conduct business on a global scale while at the same time maintain a local approach. The bottling companies are locally owned and operated by independent business people who are authorized to sell product of the Pepsi Company. Because Cola does not have outright ownership of its bottling network, its main source of revenue is the sale of concentrate to its bottlers. Weaknesses Weaknesses for any business need to be both minimized and monitored in order to effectively achieve productive and efficiency in their business activities, Pepsi have no exception. Even though domestic business as well as many international market are thriving volumes in Latin America were up 12%, Pepsi has recently reported some decliners in unit case volumes in Indonesia and Thailand due to reduce consumer purchasing power. According to an article in Fortune magazine, in Japan, unit case sales fell 3% in the second quarter of 1998. Consequently we can determine the Pepsi Weakness which is can be improve and can be make sure that in future they will never happened again. Besides that, Pepsi on the other side has effects on the teeth which is an issue for health care. It also has got sugar by which continuous drinking of Pepsi may cause health problem. Being addicted to Pepsi also is a health problem, because drinking of Pepsi daily has an effect on your body after few years. Because its contain chemicals which could cause cancer, damage the nervous and reproductive system and reduce bone mineral density. Such negative publicity could adversely impact the companys brand image and the demand for Pepsi product. This could also have an adverse impact on the companys growth prospects in the international market Negative publicity The company received negative publicity during September 2006.The Company was accused by the Center for Science and Environment (CSE) of selling products containing pesticide residues that contained a hazardous pesticide residue. These pesticides included chemicals which could cause cancers, damage the nervous and reproductive systems and reduce bone mineral density. Such negative publicity could adversely impact the companys brand image and the demand for Pepsi products. This could also have an adverse impact on the companys growth prospects in the international markets. Opportunities Brand recognition is the significant factor affecting Pepsis competitive position. Pepsis brand name is known well throughout 94% of the world today. Its mean that the primary concern over the past few years has been to get this name brand to be even better known. Packaging changes have also affected sale and industry positioning, but in general, the public has tended not to be affected by new products. Pepsi bottling system also allows the company to take advantage of infinite growth opportunities around the world. This strategy gives Pepsi the opportunity to service a large geographic, diverse area. Pepsi is such an experienced powerful global company, which has a basic of a great fund. So it has the ability to place an idle sum of money to the promotion. We can see that the advertisement of Pepsi-Cola is so attractive. It also invited the top famous people to advertise for it. The advertisement is so elaborate and attractive so that Pepsi gained the special prize of the advertisement Granny. Threats Currently the threat of new viable competitors in the carbonated soft drink industry is not very substantial. The threat of substitutes however is a very real threat. The soft drink industry is very strong, but consumers are not necessarily married to it. Possible substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee, juices, milk, and hot chocolate, even thought Coco-Cola and Pepsi control nearly 40% of the entire beverage market, the changing health-consciousness of the market could have a serious affect. Of course, both Coke and Pepsi have already diversified into these markets, allowing them to have further significant market shares and offset any losses incurred due to fluctuations in the market. Consumer buying power also represents a key threat in the industry. The rivalry between Pepsi and Coke has produce a very slow moving industry in which management must continuously respond to the changing attitudes and demands of their consumer or face losing market share to the competition. In addition, consumer can easily switch to other beverages with little cost or consequence. Intense competition Pepsi competes in the nonalcoholic beverages segmen