Abstract:

The study shall show changes have occurred in the supply and demand of coal & iron-

ore in the Australian economy. These are two resources that are very much essential

for Australia. They add significantly to the country’s GDP. But the demand & supply for

these two resources have fallen drastically in China. This induced a greater affect for

the Australian manufacturing organizations. But their supplies have been increasing

considerably in Australia. Ironically, their demands have dropped very much. Since

2013 this trend has begun. It is still continuing. The Council of Financial Regulators

thinks it differently. Firstly, the council thinks this situation will change by 2018.

Secondly, supply will be constant. Thirdly, demand for these two resources by go up.

Table of Contents

1.0 Introduction: 2

1.2 Incomes: 2

1.3 Price of goods: 2

1.4 Price of related goods (Complements & (Substitutes): 3

1.5 Tastes & Preferences: 3

1.6 Income distributions: 3

2.0 Factors affecting the supplies of coal & iron ore: 3

2.1 Price of the said goods: 4

2.2 Prices of other goods: 4

2.3 Price of factor inputs: 4

2.4 Technology: 4

2.5 Government’s taxation policy: 5

3.0 The by and large effects: 5

4.0 Conclusion: 6

5.0 References 6

1.0 Introduction:

Factors affecting the demand for coal & iron ore:

Factors affecting the demand for these resources are given below:

1.2 Incomes:

The demand for these resources depends upon the peoples’ income. It is the

rudimentary factor. Normal goods pose a positive income effect. Inferior goods pose a

negative income effect. As incomes of people rise, demand falls for inferior commodities

(Carboni, 2014).

1.3 Price of goods:

As price of iron- ore and coal rises, their demand falls. It pertains to income effect. As

price of iron- ore and coal falls, their demand falls. Consumption of iron and coal falls as

its price rises.

1.4 Price of related goods (Complements & (Substitutes):

The demand for coal & iron is influenced when prices of other commodities change. The

goods may be substitutes or complements (Kim and Lee, 2014). For example when the

price of iron rises, then price of steel also rises. These are complementary goods.

Again, if the price of petroleum soars high, then biomass sources can be used. These

are substitute commodities.

1.5 Tastes & Preferences:

The demand for coal and iron is ordained by the consumers’ preferences & tastes. Their

demand may vary according to the use of products. Their demand may vary over times

also. Thus, to supply iron and coal, their demand is essential for the suppliers. For

example, railways of many countries used coal to run railway engines. But now they

mostly run on electricity. Thus, consumers’ preferences have changed. India is an

example where coal was used for cooking. But now the consumers use liquefied

petroleum gas for cooking.

1.6 Income distributions:

When the incomes in the society are equally distributed, all have equal purchasing

power (Miron and Alexe, 2014). Then every person in the society can purchase

commodities as per their preferences. The demand for costly commodities drops when

income is equally distributed. People consume more when their income soars. People

consume less when their income is less. But equal income distribution is a rarity in the

society.

2.0 Factors affecting the supplies of coal & iron ore:

Several factors influence the supply of these two resources. These factors are as

follows:

2.1 Price of the said goods:

The supply of goods and their prices are positively related. When price rises, so does

the supply. When the price falls, so does the supply. Greater profits are gotten by

suppliers when prices are exorbitant.

2.2 Prices of other goods:

Every resource has alternative uses. Not only their price but goods also depend on

prices of other commodities. When prices of other good rises, it is profitable for the said

commodity. It means firms alter their limited resources. Thus, firms produce some other

goods. For example if the prices of thermal energy rise, then the use of hydroelectricity

will be more. When the cost of meat rises, non-veg pizza is costly to make. Instead, the

pizza joints can make cheese pizzas. It is because meat is one of the essential

elements of non-veg pizza.

2.3 Price of factor inputs:

The costs of productions rise due to two situations as follows:

a) Firstly, if the cost of an input of production rises.

b) Secondly, if amounts payable to the inputs of production increases.

It means the profitability drops. Thus, the suppliers will slash the prices of goods that

they supply. The supply of goods shall rise if the prices of the production input drop.

Thus, production cost also drops. Subsequently, there is the hike in the profit margins.

For example, if the production cost of iron drops, then more steel can be produced. If

the cost of cement rises, the production of buildings will not be profitable. Thus, fewer

buildings will be made. But the producer will always try to pass on the extra amount to

the consumers.

2.4 Technology:

The supply of commodities is influenced by technological leapfrogging. If the technology

used in the production process is improved or advanced, then the cost of production is

lessened. Thus, the profit margin is hiked (Von Broembsen, 2012). Outdated technology

leads to incur more costs of production. This affects the supply of goods. Thus, the

supply decreases considerably.

2.5 Government’s taxation policy:

There can be rises in the cost of production and taxation (Von Broembsen, 2012). This

induces the reduction in the supply of goods. Because of less margin of profit it

happens. The government can bestow tax concessions or subsidies. It increases the

supply. Thus, firms become more profitable.

3.0 The by and large effects:

Since 201, there have been bulk investments by the Australian investors. It is mainly

due to a potent demand from the Chinese energy sector. At this time, the costs of iron

and coal were too exorbitant. Thus, the investors became greedy. They thought of

making the best use of this situation. The balance of trades was favorable for Australia.

It made the Australian economy flourish. The profile of the resource output is principally

based on the Chinese demand number. There were mere chances of growth in the

domestic market as per consumer demand for iron & coal. The GDP of the country is

mainly dependent on the yields from this sector. Primary concerns are about the growth

in the production of iron and coal. It is because the demands have dropped for coal and

iron. Australia’s resource boom happened due to the Chinese demand. There was a rise

in the production of steel from 489-832 million tons. By the year 2030 this matured

industry of China will decline. It is because they build scraps from older steel. So, the

economy will see a drop in the demand for coal and iron. The nation has made the

export prices lower. It is to maintain the same production level. Thermal energy uses

are degrading. It is because of the Chinese economy’s growth. Secondly, it is due to

environmental effects. Hydro-wind is a substitute for the thermal sector. Hydro-wind’s

increase caused a drop in the demands for the thermal energy. From the year 2006 to

2012, there was an increasing demand for coal. Thus, its consumption increased

considerably in China. But last year (2014), it dropped more than two percent. The

growth of the Indian economy is also the matter of fear. It is because quality coal and

iron is required to widen its infrastructure. South-east Asian nations will see more

growth in their demands. Thus, poor demand in the Chinese economy will offset. It is

thus, a golden opening for exporters in Australia (Financial Review, 2015).

4.0 Conclusion:

Challenges are faced by the Australian economy due to drop in demand of iron and

coal. It is for the decrease in the Chinese growth. The current ROI is poorer for the

country’s resources sector. But economists see a ray of hope from South-east Asian

countries’ demand. They argue the losses of the investors in the resource & mineral

sector.

5.0 References

Carboni, G. (2014). Term Premia Implications of Macroeconomic Regime

Changes. Macroecon. Dynam., pp.1-25.

Financial Review, (2015). Resources perfect storm. [online] Available at:

http://www.afr.com/opinion/australia-has-not-recognised-the-change-in-chinese-

demand-for-iron-ore-and-coal-20150405-1mf00o [Accessed 8 Aug. 2015].

Kim, S. and Lee, J. (2014). INTERNATIONAL MACROECONOMIC

FLUCTUATIONS.Macroecon. Dynam., pp.1-31.

Miron, D. and Alexe, I. (2014). Capital Flows and Income Convergence in the European

Union. A Fresh Perspective in View of the Macroeconomic Imbalance

Procedure. Procedia Economics and Finance, 8, pp.25-34.

Von Broembsen, M. (2012). People want to work, yet most have to labour: Towards

decent work in South African supply chains. Law, Dem. & Dev., 16(1).

KHA 117603

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In the following question, they have asked what are the issues surrounding the use of random number in simulation. You have given 5 points. Kindly elaborate the same.

Question:

Answer

Following are the issues surrounding the use of random numbers  in simulation:

1.Uniformity

2.Independence

3.Efficiency

4.Replicability

5.Long Cycle Length

Monte-carlo simulation technique requires the generation of a sequence of random numbers that is an integral part of the simulation model. The sequence of random numbers help in choosing random observations from the probability distribution.

Random numbers, used in simulation exercises are generated using digital computers.

*Multiplicative Congruential Random Number Generation Method:

Basic Relationship:

X_i+1 = a X_i (mod m), where a ³ 0  and  m ³ 0

Most natural choice for m is one that equals to the capacity of a computer word.

m = 2^b (binary machine), where b is the number of bits in the computer word.

m = 10^d (decimal machine), where d is the number of digits in the computer word.

The max period(P) is:

For m a power of 2, say m = 2^b, and c ¹ 0, the longest possible period is P = m = 2^b , which is achieved provided that c is relatively prime to m (that is, the greatest common factor of c and m is 1), and a = 1 + 4k, where k is an integer.

For m a power of 2, say m = 2^b, and c = 0, the longest possible period is P = m / 4 = 2^b-2 , which is achieved provided that the seed X₀ is odd and the multiplier, a, is given by a = 3 + 8k or a = 5 + 8k, for some k = 0, 1,…

For m a prime number and c = 0, the longest possible period is P = m – 1, which is achieved provided that the multiplier, a, has the property that the smallest integer k such that a^k – 1 is divisible by m is k = m – 1,

In the given demonstration , X_i+1 = a X_i (mod m)

Here, a=6, m=17, x₀=1, since m-1=16 is the 2 digit random number, therefore it will generate 2-digit random numbers.

So, X₁ = a X₀ (mod m)=6*1(mod 17)=6/17=06

X₂ = a X₁ (mod m)=6*6(mod 17)=36/17=02

X₃ = a X₀ (mod m)=6*2(mod 17)=12/17=12

The student got the following answer from one of his friend.  Please provide your suggestions for the answer given.

Question : What are the issues surrounding the use of random number in simulation.

Answer : Random numbers are integral part of simulation as it allows verification of model based on unbiased number generation. However there are multiple random number generation techniques varying from simple to complex calculation. Every model can only respond to particular set of random numbers only. Therefore it becomes quintessential to pin point random number generation technique to be used for any specific model.

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Hearing is a one of the vital senses of a human being. The organ involved in hearing is the ear.

The transmission of the sound waves from the source occurs through the external auditory canal

to the middle ear. In the middle ear, there are small bones commonly referred to as the ossicles

which include the malleus, incus and stapes that convert the sound waves into electrical stimulus

that is detected by the sensory neurons in the ear. The main nerve that is involved in the process

of hearing is known as the vestibular cochlear nerve. Some of the causes of damage to the

hearing system include trauma, drugs such as aminoglycosides, infections, and loud noise.

(NIDCD 2014).

The damage to the ear results in divergent symptoms mainly depending on the cause.

Some of the most common symptoms are ear-pain, discharge of pus or blood, tinnitus i.e. ringing

sounds in the ear, irritation and itchiness. The symptoms of damage to the hearing system i.e. the

ear, may appear suddenly or graduals in a manner that they are difficult to detect easily. It thus

calls for the individuals or parents to be highly suspicious and be able to identify the issue

quickly using the symptoms that appear early (PAMF or Palo Alto Medical Foundation-

2015). If not treated, any minor damage may result in hearing loss. Early treatment is hence

advised with the aim of eliminating the problem before it becomes a permanent issue i.e. loss of

hearing. Nevertheless, if the cause e.g. trauma was severe at the first encounter, it might directly

cause loss of hearing. Damage to the ear may result in difficulty in hearing the voice of people

clearly and thus leading to misunderstanding of the info that was being conveyed (Asha Sphere

2013).

In addition; the affected individual keeps on telling people to repeat what they have already said.

Another symptom that could be indicative would be an individual listening to music or watching

the television whose volume is high. On the other hand, some people tend to hear the sounds of

low frequency as loud sounds that are commonly referred to as hyperacusis. This mainly results

from the damage to a muscle known as the stapedius muscles that are located in the middle ear

where it supports the small bones of the middle ear i.e. the ossicles (Hidden Hearing- ND).

Such individuals also tend not to hear a doorbell or even a phone ringing. In children, there are

several symptoms that show that there is damage to the hearing system. One major symptom is

that the child lacks to get startled by sounds of high frequency. In addition, affected children tend

to talk loudly and learn to speak slowly (Mayo Clinic- 2014).

Currently, the researchers have solved the problem of hearing for the children born

lacking hearing nerve. In this case, the cochlear implants and the hearing aids cannot help. Such

individuals cannot perceive any sound no matter the frequency or amplitude. The researchers

have come up with an auditory brainstem implant that can induce the nerves located in the

brainstem directly. In this way, it eliminates the need for the cochlear nerve (BHI 2015). Another

study carried out recently has shown that supplements of vitamins to be helpful in the prevention

of hearing loss that is induced by noise. The experiment was done in a mouse by the use of

Vitamin B3. In addition, the vitamin supplements are effective in treating some of the age-related

diseases caused by the lack of that protein. The people of 65 years or more are getting trapped by

hearing loss known as presbycusis. ( HLAA- 2015)

Treatment of a patient who present with the symptoms of hearing system damage

depends on the cause. In case a person has pus discharging from the ear, the likely diagnosis is

otitis media and hence they are given antibiotics. In case the cause was trauma, a surgery may be

performed. For people with hearing loss, hearing aids are used as a mode of treatment. In

children too, the reason through the various tests detected first and then the exact treatment is

decided (NCPH – 2015).

Prevention mainly entails strategies that are aimed at preventing the different causes of

the damage. One main strategy is good hygiene of the ears to ensure that there are no infections.

In addition, one ought not to listen to music at a high volume. Also, regular ear check-up is

necessary for all but be conscious about children and infants. One should also avoid the use of

excessive drugs such as aminoglycosides (Caring, 2007).

References

Sound and Hearing Loss: Symptoms of Damage

Citation

1. NIDCD. (2014). Noise-Induced Hearing Loss. Retrieved May 09, 2015, from

http://www.nidcd.nih.gov/health/hearing/pages/noise.aspx

2. BHI. (2015). Signs of hearing Loss. Retrieved May 09, 2015, from

www.betterhearing.org/hearingpedia/signs-hearing-loss

3. Asha Sphere (2013) Know The Sign of Hearing Loss. Retrieved May 09, 2015, from

the site

http://www.asha.org/public/hearing/Hearing-Loss/

4. Hidden Hearing (ND). Hearing Information. Retrieved May 09, 2015, from

http://www.hiddenhearing.co.uk/hearing-information/

5. Mayo Clinic (2014). Diseases and conditions Hearing Loss- symptoms. Retrieved

May 09, 2015, from http://www.mayoclinic.org/diseases-conditions/hearing-

loss/basics/symptoms/con-20027684?reDate=09052015

6. Caring (2007). Hearing Loss Signs- 6 Early Warning Signs of Hearing Loss.

Retrieved May 09, 2015, from https://www.caring.com/articles/early-warning-

signs-of-hearing-loss

7. PAMF (Palo Alto Medical Foundation) (2015). Symptoms of Hearing Loss in

Children. Retrieved May 09, 2015, from

http://www.pamf.org/hearinghealth/facts/children.html

8. NCPH (2015). Early Hearing detection and Intervention Program. Retrieved May

09, 2015, from

http://www.ncnewbornhearing.org/lateonset.htm

9. HLAA (2015). Hearing Loss Basics Retrieved May 09, 2015, from

http://www.hearingloss.org/content/basic-facts-about-hearing-loss

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Monroe Doctrine

The Fifth US President James Monroe had announced about Monroe Doctrine in his speech on

December 2, 1823.This had a significant role that dealt with the development of the country.

According to this doctrine, the United States that just got independence would not accept power

of European countries to interfere in the affairs of the Western Hemisphere countries. But, in

case the European tried to interfere, the war would be the only option to retaliate.

Not only the President Monroe, but the state secretary John Quincy Adams was much more

responsible for stating the doctrine.

In 1822, none other than Bolivia were dependent under control of some other countries. Only

this one in Latin America had to follow the Spanish rules and regulations. Moreover, some other

islands in Caribbean continued under the control of Spain. In April 1823, when the war appeared

in the countries of Europe, the US government was horrified about those colonies in the US that

were in Spanish control. They thought the probability of controlling could be ceded to either

Quincy Adams, the secretary of the state, explained the concern outlining through a letter to

Hugh Nelson, the minister of Spain. The important countries like Spain, Britain, France and

Russia got involved and Britain tried to put an effort in front of the United State, which was

refused by Adams. When Adams argued in the cabinet of the president, then he forced on the

unilateral declaration and the president agreed. This declaration had some principles and these

were together known as Monroe doctrine. These principles are as follows-

 The colonization for the Western hemisphere would not be possible as it would not be

 There is a huge difference between the political system of Europe and America.

 There would be the refrain from the contribution of the United States in the wars of

 Any interference in the Western Hemisphere would be regarded by the US as a danger to

The United States invoked this doctrine in different areas and all those countries got their right

position. It took decades to settle and make it perfect for the nation, but lastly it succeeded.

Reference- http://www.u-s-history.com/pages/h255.html

http://www.ask.com/history/monroe-doctrine-important-4e43784554899ff4#full-answer

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analytical techniques – exam paper

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Drug & pharmaceutical industry plays a vital role in the health care of the any country.Rapid growth of this industry requires further attention because even after 50 years of independence, India, with around 15 percent of the World population, accounts for lessthan 2 percent of the drug production in the world. Annual per capita consumption of medicine in India is less than 2% of that in Japan. Health care expense in India is adismal 0.8 percent of GDP compared with 12.4 percent in U.S.A. 6.5% in Japan and 6.2 percent in the U.K, despite higher incidence of disease and malnutrition. The povertyand disease in India on one hand calls for higher standard of healthcare and pharmaceuticals production and on the other, stultifies the growth of industry due to poor affordability of an average Indian. Drug & Pharmaceutical industry has therefore,encountered a tough situation which most industry have always found difficult,to provide abundant quantity of quality products at low prices.

The Indian Pharmaceutical industry, valued at $46.2 billion has been witnessingattractive growth rate of 15% to 20% consistently over the past decade. This growthwas build by India’s large population, increasing allocation of income to healthcarespending and exports. Exports which currently accounts for 20% of the productionvalue has grown by a compound annual growth rate of 34% in the past few years due tocompetitive price advantages from India’s low labor and other input cost.

The Indian market for pharmaceutical products stands at an enormous $58.8 billion.The big 10 companies account for over 30% of that, take away 45 marketer and averagesales don’t even come any where near the $2.5 million marks, that’s how fragmented itsis some 50,000 brands from over 20,00 companies growing fast enough to embarrassrainy day mushrooms and enough diseases to savage Indian population all several times  over and turn Dr. Dolittle into Dr. Don’t care..

About MSD
MSD Pharmaceuticals Private Limited is an affiliate of Merck & Co. Inc., USA. (also known as Merck Sharp &Dohme or MSD in many parts of the world), a global research-driven pharmaceutical company dedicated to putting patients first. Established in 1891, Merck Sharp &Dohme currently discovers, develops, manufactures and markets vaccines and medicines to address unmet medical needs.

With global headquarters in New Jersey, USA, Merck & Co. Inc. 2007 sales stood at US $24.2 billion with 59,800 employees and product sales spanning 140 countries worldwide. The Merck Manufacturing Division employs more than 12, 000 people at locations in 25 countries.

UNPARALLELED SCIENTIFIC EXCELLENCE
Merck & Co. Inc., USA success has always been based on innovation and scientific research. A commitment to excellence in research is at the heart of its philosophy and strategy. Since the founding of its research laboratories over 70 years ago, Merck & Co. Inc. has developed more than 100 new medicines and vaccines.

The Merck Research Laboratories employs approximately 9,500 people at sites in the United States, Canada, Europe and Asia. In 2007 Merck & Co. Inc. invested US $4.9 billion in R&D.

Currently Merck’s priority areas of focus in therapeutic research include Alzheimer’s disease, atherosclerosis, cardiovascular disease,

diabetes, novel vaccines obesity, oncology, pain, and sleep disorders. These therapeutic areas were carefully chosen based on a set of criteria including unmet medical needs, scientific opportunity and commercial opportunity. Within these therapeutic areas, Merck & Co. Inc. has committed resources to achieve research breadth and depth and to develop best-in-class targeted and differentiated products that are valued highly by patients, payers and physicians.

MSD operates in India via three separate legal entities MSD Pharmaceuticals Pvt. Ltd., Organon India Limited and Fulford India Limited. 

Since its existence in India, the company has moved quickly in laying the foundation for a successful business in India; a business that is differentiated by its focus on putting patients first and launching innovative products those are relevant to India. MSD India currently operates in various therapeutic areas including Metabolics, Cardiovascular, Vaccines, Critical Care, Immunology, Virology, Oncology, Women’s health, Dermatology, Respiratory, Virology, Muskulotology and Primary Care.

Post integration with Schering-Plough, the new MSD India offers a much stronger, diversified and higher value product portfolio of over 75 brands in various therapeutic areas, of which 13 are already category leading products.

Vaccine                                            

Our world-class prophylactic and therapeutic vaccines bring relief to millions of people in the region. Vaccines are one of the greatest public health success stories of the 20th century, and Merck has played its part in that story. We are one of a few companies who remain dedicated to the complex business of researching and producing vaccines.

Primary Care

We are committed to improving communities’ access to healthcare through our products and solutions. Our direct contact with healthcare providers and institutions ensures that widest reach of and access to put industry-leading products.

MSD in India and Sun Pharmaceutical Industries Ltd. (Sun Pharma)  announced formation of an India-specific strategic partnership agreement under which Sun Pharma will have the right to market, promote and distribute MSD’s diabetes products, sitagliptin and sitagliptin plus metformin, under different brand names in India.  

Both partners complement each other’s strengths in this arrangement. While MSD in India brings the scientific excellence and market success of the compound to the partnership, Sun Pharma brings its proven success and expertise in the marketing of drugs in the relevant therapeutic areas across India. This is yet another testimonial to MSD’s commitment towards the patients of India and towards addressing high disease burdens of chronic diseases like type 2

Diabetes, while providing broader access of our first in class and best in class drugs in the country.”

Sun Pharma enjoys a strong relationship with the physician community such as diabetologists, endocrinologists and consulting physicians treating patients with diabetes across India.  Through this partnership, the reach of sitagliptin and sitagliptin plus metformin will be enhanced amongst doctors & patients in India, helping them efficaciously manage the disease.”

A REVIEW OF MARKETING STRATEGIES WORK BY DIFFERENT PHARMACEUTICAL COMPANIES

The current shift in the marketing strategy is work by multinational pharmaceutical Companies .It is now high-end (rather than adaptive) development that is being carried out by leading companies. And, increasingly, other companies are finding themselves competing against, or working with, new innovation-based companies. My study focuses on the processes and outcomes of globally distributed pharmaceutical companies. This article will present the changing marketing strategies when a pharma company shift from Acute base to Chronic therapy base. This research paper will also give an insight about shift in supply chain process and customer and end-customer perception which is the base of formulation of different marketing strategies.

The pharmaceutical industry is the world’s largest industry due to worldwide revenues of approximately US$2.8 trillion. Pharma industry has seeb major changes in the recent years that place new demands on payers, providers and manufacturers. Customers now demand the same choice and convenience from pharma industry that they find in other segment.

Indian Pharmaceutical Industry is poised for high consistent growth over the next few years, driven by a multitude of factors. Top Indian Companies like Ranbaxy, DRL CIPLA and Dabur have already established their presence.

The pharmaceutical industry is a knowledge driven industry and is heavily dependent on Research and Development for new products and growth. However, basic research (discovering new molecules) is a time consuming and expensive process and is thus, dominated by large global multinationals.

Indian companies have only recently entered the area. The Indian pharmaceutical industry came into existence in 1901, when Bengal Chemical & Pharmaceutical Company started its maiden operation in Calcutta. The next few decades saw the pharmaceutical industry moving through several phases, largely in accordance with

47

(doctor) is responsible . Essentially, the end-user (patient) consumes a product and pays the cost .

Use of medical representatives for marketing products to physicians and to exert some influence over others in the hierarchy of decision makers has been a time-tested tradition. Typically, sales force expense comprises an estimated 15 percent to 20 percent of annual product revenues, the largest line item on the balance sheet. Despite this other expense, the industry is still plagued with some very serious strategic and operational level issues.

2.1 From organizational perspective the most prominent performance related issues are enlisted below:

a) .Increased competition and shortened window of opportunity.

b). Low level of customer knowledge (Doctors, Retailers, Wholesalers).

c). Poor customer acquisition, development and retention strategies

.

d). Varying customer perception.

e). The number and the quality of medical representatives

d). Very high territory development costs.

f). High training and re-training costs of sales personnel.

g).. Very high attrition rate of the sales personnel.

h). Busy doctors giving less time for sales calls.

i). Poor territory knowledge in terms of business value at medical representative level .

j). Unclear value of prescription from each doctor in the list of each sales person.

k). Unknown value of revenue from each retailer in the territory

l). Virtually no mechanism of sales forecasting from field sales level, leading to huge deviations

m). Absence of analysis on the amount of time invested on profitable and not-so-profitable customers and lack of time-share planning towards developing customer base for future markets

n). Manual and cumbersome administrative systems and processes designed

which     don’t   facilitate   optimal   efficiency   levels   in   sales   teams

And many more…………

2.2 Patents

Patents are a vital aspect of the global pharma industry. Patent protection is essential to spur basic R&D and make it commercially viable. But, only the developed nations endorse product patents. Most third world countries have patent laws but enforcement is totally lax. Some developing nations like India, Egypt and Argentina allow only process patent registration.

2.3 New Drug Approval (NDA)

Prior to launching its products in any country, a pharma company undertakes patent registration to protect its own interests. To protect the interests of the consumers, it is necessary that the product be approved by the drug authorities in that country. Mostly the process for seeking approval is initiated alongside the patent registration process.

2.4 WTO

Due to pressure from the developed countries, across the world uniformity in patent laws is being implemented under WTO (World Trade Organization – earlier GATT i.e. General Agreement on Tariffs & Trade). Presently, different countries have different patent types and life period. WTO has decided upon a product patent life of 20 years in all countries.

2.5 RESEARCH & DEVELOPMENT (R&D)

The pharmaceutical industry is characterized by heavy R&D expenditure. It is only the large pharmaceutical companies who can allocate significant resources for R&D to introduce new products. As the products are an outcome of significant R&D expenditures incurred by these companies, they have their products patented. The patent allows the companies concerned to wield immense pricing power for their new products.

2.6 THE COMPETITION

The level of competition in very high in Acute segment on day to day basis

49

however the degree of competition in not as much as high in Chronic therapy area on day to day basis

As doctor has to prescribe drug for a long time in chronic cases and patient is suppose to consume it without any change of brand. While in acute cases doctor is changing brands on day to day basis.

3.Pharmaceutical Company Business Strategies

What’s the secret behind these successes? For one, the company operates in niche formulations (chronic) segments such as psychiatry, cardiovascular, gastroentology and neurology. While most of the top Indian companies have focused on antibiotics and anti– infectives (acute), Sun Pharma focused on therapeutic areas such as depression, hypertension and cancer. The company has introduced the entire range of products and has gained leadership position in each of these areas. Being a specialty company insulates Sun Pharma from the industry growth. The first quarter results for FY02 explain this to some extent. While the industry was affected to a large extent by a slowdown in the domestic formulations market, Sun Pharma logged a growth of 26% in revenues. Over the years Sun has also used the strategy of acquisitions and mergers to grow quickly. It acquired Knoll Pharma’s bulk drug facility, Gujarat Lyka Organics, 51.5% in M. J. Pharma, merged TamilNadu Dadha Pharma & Milmet Labs and acquired Natco’s brands. Post Merger with TamilNadu Dadha Pharma the company gained presence in gynecology and oncology segments.

One of the constants of pharmaceutical company strategy over the past decade has beenincreasing scale. Only by growing larger are companies able to afford the considerable costs of drug development and distribution.

Within this broad approach at least two business models are discernable:

(i)    Super Core Model involving the search for, and distribution of a small number of drugs from Chronic Threapy Area that achieve substantial global sales. The success of this model depends on achieving large returns from a small number of drugs in order to pay for the high cost of the drug discovery and development process for a large number of patients. Total revenues are highly dependant on sales from a small number of drugs.

Core Model in which a larger number of drugs from Acute Threapy Area are marketed to big diversified markets. The advantage of this model is that its success is not dependant on sales of a small number of drugs.

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India has world’s third largest higher secondary education system with a number of institutions. More and more students are going for higher education these days. The result gets reflected on the number of students enrolling for higher education. The number of institutions is also increasing day by day. India has got following numbers of educational institutions (as on December 31, 2007):

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1.1.1 Introduction to the Topic

In modern business, environment organizations are striving hard to meet customer expectations (Lai et al. 2014). These customer expectations are supercilious in nature thus organizations are forced to be quick to respond. Being global is the key to organizational growth especially for the aviation industry. For supporting this global approach in a sustainable manner and gain leadership position, it is a mandate for airline companies to outshine satisfaction level of customers by providing them with quality services, which their competitors fail to.

In airline industry, which is essentially a service business format, quality of customer service perceived and provided drives customer satisfaction (Chen & Chang 2005). Thus, companies need to be exceptional in this area for gaining competitive advantage. Airline companies continually design innovative services for not only meeting customer expectation but also achieve organizational goals.

1.1.2 Introduction to the Company: Etihad Airways

Etihad Airways, founded in the year 2003 by Royal (Amiri) Decree. Its  headquarters are in Abu Dhabi, United Arab Emirates (Bloomberg Businessweek 2015). Since then the airways is striving to gain a leadership position within air transport industry not only in the Middle East but in international arena too (Etihad 2015). Etihad Airways has marked a strong presence in countries from areas like Middle East, Africa, Europe, Asia, Australia, and North America thereby connecting a larger part of the world within a short span of 12 years (Bloomberg Businessweek 2015).

Along with core-air transportation service, Etihad also offers ground services, especially to those availing limousine and lounges. These services are made available in selected cities namely London, Abu Dhabi, Manchester, Frankfurt, Paris, Dublin, and Washington, D.C (Bloomberg Businessweek 2015). Further Etihad also offers training and development for local people categorized as Emiratis through programs related to cadet pilots, technical engineering, and management development. Global Traveller Awards have accredited Etihad with a number of awards in the year 2014 in categories related to Airline of the Year, Best Airline in the Middle East and Best Airport Staff / Gate Agents (Etihad Airways 2014). In 2014 approximately 14.3 million Revenue passengers availed the air transport services by Etihad Airways (Etihad Airways 2014).

1.1.3 Brief Introduction to Literature Review

For the purpose of this research, understanding the concepts of decision making in a consumer based on services quality was the most important aspect.. The impact of consumer satisfaction or dissatisfaction level is understood decisions taken by the same through purchase decision-making process  (Kardes et al. 2010).

The decision making process in a consumer as considered for this research is the Engel-Blackwell-Miniard Model (Masterson and Pickton, 2014). Selection of this model is considered as it concentrates more in an amalgamated ways of understanding service related factors that influence the decision-making approach in a consumer. The basic points analysed in a consumer, by this model are – need recognition, search of information (internally & externally), evaluation of alternatives, purchase, post purchase reflection and divestment (Masterson and Pickton, 2014).

In terms of service quality, a number of models have been proposed for measuring services quality, out of which SERVQUAL is the most crucial and comprehensive one. In accordance to Zeithaml et al. (2010) SERVQUAL is a complete model that aids in identification and analysis of varied perspectives of service provider and customer about a particular service and its quality. With the help of this model, organizations can efficiently categorize varied gaps that are present in service delivery process which affects customer satisfaction. Based on the analysis and identification of unique requirements measures can be taken accordingly to overcome gaps and thereby augment service quality levels. As per Seth et al. (2005) it is one of the most suitable models for determining service quality as it helps in determining the discrepancies present in customer service expectations and that provided by organizations.

1.1.4 Brief Introduction to Research Methodology

The research methodology was designed using an amalgamation of both qualitative and quantitative approaches, which implies usage of mixed method. As the method supports in undertaking a holistic research and thus has been adopted (Martins & Martins 2014). The data get collected through both primary and secondary sources for supporting achievement of research objectives. For making the study more comprehensive, primary data has been collected through 100 customers from Etihad and 100 from Emirates, making 200 in total.  Moreover, 8 managers (4 from each company) from customer service department are contact for interviews of the related companies. Secondary data was collected from varied reliable and authentic published sources (Collis & Hussey, 2014).

1.2 Problem Statement

In modern day environment, airline companies are striving to not only retain their existing customers but also attract new ones to gain sustainable business amidst intense competitive pressures. With new players entering the industry and existing competitors resorting to innovative practices, the only option left with companies like Etihad is to endow customers with satisfaction. Today, partially due to augmentation in technology and partially due to emergence of globalization the opportunities for satisfying customers have also increased.

Irrespective of this fact, due to intense competitive pressures from companies like Emirates and other constraints, Etihad is unable to benefit from its customer service strategies adopted to provide customer satisfaction. Consumer behaviour too is highly dynamic which further aggravates the problem for Etihad. Thus, this research paper attempts not only to understand the varied customer satisfaction related issues faced by Etihad and the remedial strategies used by the company in comparison to its competitors but also provide for measures through which customer satisfaction can be augmented.

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OBJECTIVES: 

The main objectives of the study are as follows: 

1)      To study the financial position of the company.

2)    To analyse the financial stability and overall performance of SAIL in general.

3)    To analyse and interpret the trends as revealed by various ratios of the company in particular.

4)    To analyse the profitability & solvency position of the unit with the existing tools of financial analysis.

5)    To study the changes in the assests,liabilities structure of the company during the period  of study.

METHODOLOGY:

For the detailed analysis of the data, I have adopted different Costing and Accounting procedures and methods like- Cost Sheet, Cash Flow Statement, Ratio Analysis, Sensitivity Analysis, and Discounting Cash Flow technique(NPV Method).  SWOT Analysis was carried out on the financial aspects of the SME sector of the Indian Steel Industry.

For expressing various results into graphs and charts, spread-sheet software MS EXCEL was used.

Finance is one of the most primary requisites of a business and the modern management obviously depends largely on the efficient management of finance. Financial statements are prepared mainly for decision making.

They play a dominant role in setting the frame work of managerial decisions. The finance manager has to adhere to 5 R’s with regard to money. The right quantity of money for liquidity consideration of right quality. Whether owned or borrowed funds, at the right time to preserve solvency from the right sources and at the right cost of capital.

The term financial analysis also known as “analysis & interpretation of financial statements”refers to the process of determing financial strength and weaknesses of the firm

By establishing strategic relationship between the items of the balance sheet ,profit & loss account and other operative data.

The purpose of financial analysis is to diagnose the information contained in financial statements so as to judge the profitability and financial soundness of the firm.

Limitations of the study :

The analysis & interpretation are based on secondary data contained in the published annual reports of SAIL for the study period.

SOURCES OF DATA :

Sources of date are collected from annual reports of the company

From the year 2010-11 & 2011-12.

METHODS  OF DATA ANALYSIS :

The data collected were edited,classified & tabulated for analysis.

The analytical tools used in this study are :

Analytical tools  applied :

1) Comparative Statement

2)  Common  Size Statement

3)  Trend percentage

4)  Ratio Analysis

ANALYSIS AND INTERPRETATION :

Financial statement is an organized collection of data according to logical and consistent accounting procedures.Its purposes to convery an understanding of some financial aspects of a business firm. It may show a position at a moment of time,as in the case of a balance sheet,or may reveal a series of activities over a given period of time, as in the case of a Income statement.Thus the “Financial Statements” refers to two basic statements : (i) the Income statement & (II) Balnace Sheet.

RATIO ANALYSIS:

Ratio Analysis of the Cost Statement of the production process of hot metal (without using sinter):

1) RAW MATERIAL COST: WORK COST=13,695:15,190=1:1.1

2) IRON ORE COST: WORK COST=4,420: 15,190=1:3.4

3) COKE COST: WORK COST=8,800:15,190=1:1.7

4) IRON ORE: COKE=4,420: 8,800=1:2

5) IRON ORE: COKE: FLUX=4,420:8,800:475=9.3:18.5:1

6) FLUX COST: WORK COST=475:15,190=132

7) IRON ORE COST: TOTAL RAW MATERIAL COST=4,420:13,695=1:3

8) COKE COST: TOTAL RAW MATERIAL COST=8,800: 13,695=1:1.6

9) FLUX COST: TOTAL RAW MATERIAL COST=475: 13,695=1:29

10) LIMESTONE: DOLOMITE: QUARTZ=220:225:30=7.3:7.5:1

11) LABOUR COST: WORK COST=500:15,190=1:30

12) DIRECT LABOUR: INDIRECT LABOUR=400:100=4:1

13) UTILITY COST: WORK COST=535:15,190=1:28

14) POWER: WATER=525:10=52.5:1

15) OVERHEAD: WORK COST=100:15,190=1:152

16) STORES & CONSUMABLES: WORK COST=500:15,190=1:30

17) PRIME COST (MATERIAL+DIR. LABOUR): WORK COST=(13,695+400):15,190=14,695:15,190=1:1.034

18) PBDIT: WORK COST=3,060:15,190=1:5

Ratio Analysis of the Cost Statement of the production process of hot metal   (WITH SINTER  40 %):

1) RAW MATERIAL COST: WORK COST=12,194:13,389=1:1.1

2) IRON ORE COST: WORK COST=2,629: 13,389=1:5

3) COKE COST: WORK COST=8,250: 13,389=1:1.6

4) IRON ORE:COKE=2,629: 8,250=1:3.14

5) IRON ORE:COKE: FLUX=2,629: 8,250:280=9.4:29.5:1

6) FLUX COST: WORK COST=280: 13,389=1:48

7) IRON ORE COST: TOTAL RAW MATERIAL COST=2,629:12,194=1:4.6

8) COKE COST: TOTAL RAW MATERIAL COST=8,250: 12,194=1:1.5

9) FLUX COST: TOTAL RAW MATERIAL COST=280: 12,194=1:44

10) LIMESTONE: DOLOMITE: QUARTZ=110:150:20=5.5:7.5:1

11) LABOUR COST: WORK COST=350:13,389=1:38

12) DIRECT LABOUR: INDIRECT LABOUR=150:200=3:4

13) UTILITY COST: WORK COST=535: 13,389=1:25

14) POWER: WATER=525:10=52.5:1

15) OVERHEAD: WORK COST=150: 13,389=1:89

16) STORES & CONSUMABLES: WORK COST=300: 13,389=1:45

17) PRIME COST (MATERIAL+DIR. LABOUR):WORK COST=(12,194+150): 13,389=12,344:

13,389=1:1.08

18) PBDIT: WORK COST= 4,861: 13,389=1:2.75

Financial ratio analysis groups the rations into categories that tell us about the different facets

Of a companies financial state of affairs .Some of the categories of ratios described below :

1)    Liquidity Ratios : Give a picture of companies short term financial situation or solvency.

2)    Turnover Ratios : show how efficient a companies operations and how well it is using its assets.

3)    Profitability ratios :  show the quantum of debt of companies capital structure.

Liquidity Ratios :  1) Current Ratio  2) liquid ratio 3)  Net working capital ratio.

1)    Current Raio = CURRENT ASSESTS/CURRENT LIABILITIES

An Ideal solvency ratio is 2. The ratio of 2 is considered as a safe margin of Solvency due to the fact that if current assests are reduced to half  i.e. 1 instead of 2, then also the creditors will be able to get their payments in full.

2)     Liquid Ratio :  Quick Ratio= Total Quick Assest/Total current liabilities

Quick Assets = Total current Assest- Inventory.

The liquid ratio denotes the concern had achieved more than the ideal ratio of 1:1.

3)    NET WORKING  CAPITAL RATIO :

NET WORKING CAPITAL /CAPITAL EMPLOYED.

Net working capital measures the firm’s potential reserve of funds. It can be related to NET ASSETS. This ratio represents the availability of working capital in realtion with Capital employed.

4)    TURNOVER RATIO :   i)  Fixed Assets turnover ratio  ii) Working capital turnover ratio

iii) Debtors Turnover Ratio iv)  Stock Turnover ratio.

i)                   Fixed Assets Turnover ratio : Net Sales/Net Fixed Assets

Higher the ratio is the better. A high ratio Indicates your business has less money tied up in fixed assets for each dollar of sales revenue.

ii)                Working capital turnover ratio : NET SALES /NET WORKING CAPITAL:

iii)               Debtors Turnover ratio :  a) Debtors turnover ratio  b) Debt collection Period

DTR = CREDIT SALES/AVERAGE ACCOUNTS RECEIVABLE

Average accounts receivable = Opening balance of debtors+ Closing balance of debtors/2

In SAIL, There has been increase in the DTR, which shows the efficiency of collection deptt.

iv)                Stock Turnover Ratio =  Net Sales/Average Inventory

Average  Inventory= Opening stock of Inventory + Closing Stock  of Inventory/2

Profitability Ratio :   1) Return on Investment 2) Return on Shareholder’s funds.

4)    Return on total assets  4) Earning per share (EPS)  5) Net Profit Ratio  6) Operating ratio

1)    Payout ratio  7) Dividend yield ratio

Return on Investment =  Operating Profit/Capital EmployedX100

The term operating profit means “Profit before interest & Tax” and Capital employed means sumtotal of long terms funds employed in the business.

i.e. Share capital + Reserves & surplus + long term loans-(non business assets + fictitious assets)

Return on Shareholder’s funds :  Net profit after Interest and Tax/Shareholder’s fund X100

Return on Total Assets = Net Profit after TAX/Total Assets X100

Earning per Equity Share = Net Profit after tax/No. of Equity sharesX100

NET PROFIT RATIO =  Net Operating Profit/Net Sales X100

Operating Ratio = Operating Cost /Net SalesX100

Direct Material Cost to sales = Direct Materials/Net Sales X100

PAY OUT RATIO =  Dividend per Equity Share/Earning per Equity Share X100

DIVIDEND YIELD RATIO =    Divident per share/Market price per share X100

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