Anecdotal Records in Behavior Intervention

Life Lessons Along A Christian s Journey - 1006 Words

Life Lessons along a Christian’s Journey The Bible has stories and lessons that communicates to each of us in different areas of life. The Bible is the guide to everyone’s salvation. Understanding God’s voice is understanding the existence of all the living. It is up to each person to choose a godhead life or not. The responsibility in a godhead life does not come easy. The understanding, connecting and unity in a godhead life comes with many tests and trials along the journey, but faith is all it takes. Understanding Christians understand that the Bible is from God. There is so much to take in, but we have a lifetime to get to know God and what are place is in this universe. God does speak to each of us, we just have to listen. God is†¦show more content†¦The entire bible is one book, has one author, the Holy Spirit, and has one purpose, to show the fall of man and God’s way to redeem him. No one cannot understand the New Testament without understanding the Old Testament first. Connecting The Old Testament and the New Testament are one book; one balances the other. In the Old Testament life started when God decided to make Adam, â€Å"Let us make human beings in our image, (Genesis 1:24 NIV)†. God revealed himself to humans. This is where God connected on a personal level with each of us and we learned how to speak to God. This is also the time when the â€Å"Fall of Man† was redeemed. We all may agree that again and again we â€Å"fall down†, but God is right there. We just have to believe and pray for God’s guidance. God shows grace, forgiveness and love. God sent his son, Lord Jesus Christ to show us physically and visibly what God is like. God again revealed himself to the world, by his unconditional love. God is constant in his words. Throughout the Bible starting in the Old Testament that God’s son is coming and tells how he is coming. In the New Testament, Christ is sent to save all our sins and uphold the universe. It is imp ortant to understand this from the beginning, because whatever is true of God the Father is true of Jesus Christ the Son and is true of the Holy Spirit. God is three persons, but one God. God is REAL. Role To understand God is to understand that, â€Å"The Father is God: Jesus Christ is God; the Holy Spirit is

Feminism in Education Gender Equality Free Essays

Prior to 1870 education was not formally recognised and only available to the elite few who could afford to educate their children privately or at private schools. The poorer people of society would have to rely on the education of the church and its moral teachings rather than academic teachings. Although the 1870 Forster Act was to bring education to all children between 5-10 years old, it was not welcomed by everyone. We will write a custom essay sample on Feminism in Education: Gender Equality or any similar topic only for you Order Now Some thought it would lead to the masses ‘thinking’ for themselves and see their roles in society as unfair, causing them to revolt. Others such as the church were funded by the state with public money to provide education for the poor and these churches did not want to lose that influence on youth. Although this gave children a few years of formal education , still only the richer children had the opportunity to further their education until they were 18/19 years old, thus education still being based on social class until the 1944. The 1944 Butler Education Act saw the introduction of a three stage structure that is still in place today and gave all pupils an equal chance to develop through education. It introduced primary education, up to the age of 11, Secondary education, from 11 to 15, and further education which was non- compulsory after the school leaving age. One of the ground-breaking results of the Act was to educate and mobilise women and the working class. It opened secondary school to girls, and the working class, and as a result, a far higher percentage attended higher education after secondary school. This newly found education increased working class awareness of their disadvantaged social position and created a bitter class division between the working and middle class. The most present act of education is the New Labour. The Labour government famous with its motto, â€Å"Education, Education, Education† focused their campaign on a better education system but kept many old policies such as consumer choice league tables and competition. They mainly focus on market choice and value for money in today’s education. Education, since is formal existence, has always seen a gender divide in the achievement of young people and there is many studies that link gender to education and achievement. Feminists analyse the school curriculum from a gendered perspective. Feminist argue that education plays a major role in promoting gender inequalities in society through classroom interactions, labeling and school curriculum. They highlight the existence of a gendered curriculum within schools. Since the 1944 Butler Act they have been concerned with the discrimination of girls and the difference in exam results between boys and girls The different branches within feminism offer different degrees on how this is. Liberal Feminists see that sex discrimination should be tackled through education legislation and policies and has had some success in highlighting these inequalities through the work of the Equal Opportunities Commission. They see this as being enough to combat the problems within education due to gender but Radical and Marxist feminists feel this is only the surface of the problem and it is much deeper. Radical feminists emphasise a conflict between men and women. They see men as in the dominant position within the education system to further their own interests and this patriarchy is their main problem. Their main goal is to eradicate patriarchal control and free women. They believe that inequality will be brought to an end when women are free from physical and emotional suppression. Marxist feminists believe that social class has its part to play in inequalities and that education is their to support the needs of the ruling class. As the ruling class do this the womens role is therefore to support men so are the lowest rung of society within a Capitalist society. They argree with Marxist about the hidden ciricullum but they feel that both the formal and the hidden are ways of enforcing these unequal roles within education A study that supports the feminists point of view would be Sharpe (1976) ‘Just like a girl: how girls learn to be women. This study involved interviewing 249 working class girls who lived in London. It found that many of the girls held traditional views of their role within society- motherhood , marriage and family life. Through the education system they were being set up for these roles or for jobs that were classed as womens work, ie shop assistant, office work, work with little or no promotion opportunities or job satisfaction. To support this study, Kelly (1982) also found differences with reagards to gender in the t oys that were being given to children. Although these studies did prove there were some equality between the sexes with regards to the way they children were being educated, they really investigate more the issue of stereotyping. As it is from a feminists point of view if fails to recognise that males were also underachieving at the time of Douglas’s study. It also may be a bit dated as it was conducted again in the 1990’s with vast differences. Females were now placing much more emphasis on their career and independence. This emphasises the way society has moved on and there is less of a role perception today. Also the data may have been subjective and open to interpretation as they used the method of interviews. As the studies do show some equality between the sexes, I think these theories may be a bit dated. When these studies were conducted boys were achieving more than girls, roles have changed in today’s society and feminists fail to recognise this or offer an explanation. How to cite Feminism in Education: Gender Equality, Essay examples

Case study on arbitrage pricing theory free essay sample

ABSTRACT This study investigates the Arbitrage Pricing Theory for the case of Zimbabwe using time series data from 1980 to 2005 within a vector autoregressive (VAR) framework. The Granger causality tests are conducted to establish the existence of causality among the variables like inflation, exchange rate and Gross Domestic Product. The VAR estimates as shown by the impulse response and variance decomposition together with the Granger causality test show that there is unidirectional causality from Consumer Price Index to Stock Prices. Although the Granger causality test has indicated that there is no causality between RGDP and Stock Prices, the variance decomposition has shown that the real GDP explains deviations in the Stock Prices in the long run. Granger causality tests found no meaningful relationships between Stock Prices and Exchange Rate but considering impulse response functions the effect is significant as early as the first period. Keywords: Arbitrage, Capital Asset Pricing Model (CAPM), Efficient Market Hypothesis, Vector Auto Regression Model (VAR), Impulse Response, Variance Decomposition. INTRODUCTION The Capital Asset Pricing Model (CAPM) and the Arbitrage Pricing Theory (APT) have emerged as two models that have tried to scientifically measure the potential for assets to generate a return or a loss. Both of them are based on the efficient market hypothesis, and are part of the modern portfolio theory. The Efficient Market Hypothesis (EMH) (Fama, 1965), states that at any given time, security prices fully reflect all available information. If the asset is overpriced, then arbitrageurs will short the asset, until reduced demand for purchasing it caused the price to fall. The opposite is true for underpriced securities. The CAPM is based on several simplifying assumptions and because most of these assumptions appear to be unrealistic in the real world, it has been argued that they are the cause of flaws in the CAPM (Watson and Head 1998; Harrington 1987). Several of the CAPM assumptions have been criticized. For instance, the assumptions that there are no taxes and no transaction costs do not conform to reality. In addition, the assumption of homogeneous expectations is also open to doubt, because investors usually have divergent expectations, apply various investment holding periods, differ in respect of their decision-making processes and so on. (Levy and Solomon 2000). Some researchers have also suggested that the CAPM is incorrect in respect of its description of expected returns and that a multi-factor model offers a better explanation. The Capital Asset Pricing Model (CAPM) has run into several roadblocks such as Rolls (1977) suggestion that it is not a testable scientific theory and a plethora of empirical anomalies which provide empirical evidence that the usual market proxies are not mean-variance efficient. In 1976 Ross introduced the Arbitrage Pricing Theory (APT) as an alternative to the CAPM. The APT has the potential to overcome CAPM’s weaknesses. It requires less and more realistic assumptions to be generated by a simple arbitrage argument and its explanatory power is potentially better since it is a multifactor model. The APT relates the expected rate of return on a sequence of primitive securities to their factor sensitivities, suggesting that factor risk is of critical importance in asset pricing (Gilles and Leroy, 1990). It tries to capture some of the non- market influences that cause securities to move together. The APT rests on the hypothesis that the equity price is influenced by limited and non- correlated common factors and by a specific factor totally independent from the other factors. The main empirical strength of the APT is that it permits the researcher to select whatever factors provide the best explanation for the particular sample at hand (Groenewold and Fraser, 1997). Scanty literature has tried to test the APT in Zimbabwe. Although, Chakaza (2008) has attempted to investigate the link between systematic factors and stock prices in Zimbabwe, he only focused on a unidirectional effect running from financial systematic factors to stock prices in the context of cointegration. The results he obtained supported that systematic factors influence stock prices but the issue of causality is unknown for the Zimbabwean economy and this is what this study seeks to investigate. This comes as a result of different studies carried out in different countries having yielded different results on the causality issue and the subject matter remains inconclusive. The issue of causality is far from being settled. Besides the study carried out by Chakaza (2008), the authors are not aware of any study which has been carried out for Zimbabwe in an attempt to answer the direction of causality. The study will add to the existing body of knowledge by determining the direction of causality between systematic factors and stock prices by employing a vector autoregressive (VAR) modeling framework. The rest of the paper is organized as follows. Section II reviews the theoretical and empirical literature. Section III provides the methodology to be employed in this study. The main contribution of the paper is Section IV, where the Arbitrage Pricing Theory will be tested. The paper concludes in Section V, with brief final comments and policy recommendations. LITERATURE REVIEW The Arbitrage Pricing Theory (APT) Ross (1976) developed the arbitrage pricing theory (APT) as an alternative model that could potentially overcome the CAPM’s problems while still retaining the underlying message of the later. The core idea of the APT is that only a small number of systematic influences affect the long term average returns of securities. The first ingredient of Ross’s APT is a factor model. Multi-factor models allow an asset to have not just one, but many measures of systematic risk. Each measure captures the sensitivity of the asset to the corresponding pervasive factor. If the factor model holds exactly and assets do not have specific risk, then the law of one price implies that the expected return of any asset is just a linear function of the other assets’ expected return. If this were not the case, arbitrageurs would be able to create a long-short trading strategy that would have no initial cost, but would give positive profits for sure. The intuition for the result when assets have no specific risk, is that all asset prices move in lockstep with one another and are therefore just leveraged ‘copies’ of one other. The result becomes more difficult when assets do have specific risk. In this case it is possible to form portfolios where the specific risk may be diversified away. To achieve full diversification of residual risk, however, a portfolio needs to include an infinite number of securities. With a finite set of securities, each of which has specific risk, the APT pricing restriction will only hold only approximately. The advantage of factor analytic techniques is that the factors determined from the data explain a large proportion of the risks in that particular dataset over the period under consideration. The drawback is that factors usually have no economic interpretation. As Roll and Ross argue, â€Å"an effort should be directed at identifying a more meaningful set of sufficient statistics for the underlying factors†. An alternative to factor analytic techniques is to use observed macroeconomic variables as the risk factors. One of the first studies using observed factors was by Chen et al (1986). Their argument is that at the most basic level some fundamental valuation model determines the prices of assets. That is, the price of a stock will be the correctly discounted expected future dividends. Therefore the choice of factors should include any systematic influences that impact future dividends, the way traders and investors form expectations, and the rate at which investors discount future cash flows. Empirical Investigation Mpohamba (1955) used autoregressive distributed lag (ARDL) approach for the case of Germany covering the period 1935-1954. The results reviewed that, in the long-run, inflation and real interest rate exerted positive impact on stock prices. A stable long-run relationship between economic growth and stock prices was found. This method of estimation however, does not cater for reverse causality and would be inappropriate for the estimation of causality in Zimbabwe. More so the feedback effect should have been considered. By employing provincial panel data from Congo, Zhang (1967) examined to determine if diamond prices and money supply explained the stock prices in Congo for the period 1960-1966. He employed a provincial panel data. The results suggested that both variables influenced stock prices. He concluded that the findings revealed a significant and positive nexus between diamond prices and stock prices. This method however, assumes that all elements in the collection have the same economic structure which is not the case for all provinces or nations especially the developing ones. Hamao (1988) replicated the Chen, et al (1986) study in the multi-factor APT framework. By applying an unbalanced panel data, he showed that the Asian stock returns were significantly influenced by the changes in expected inflation, and the unexpected changes in both the risk premium and the slope of the term structure of interest rates. However, different countries have different financial and economic structures which need to be estimated using different proxies and methodologies. Maysami and Koh (1990) examined long-term dynamic interactions between the Botswana Stock Exchange and macroeconomic variables for the period 1978 to 1989 by employing a vector error correction model (VECM). The variables were seasonally adjusted money supply, industrial production index, foreign exchange rate, retail price index (inflation), domestic exports, and interest rates. Results indicated a cointegrating vector among returns on the Botswana Stock Exchange and money supply growth, inflation, term structure of interest rates, and changes in exchange rates. This study is going to employ a VAR instead of VECM because the variables are not integrated of the same order. Akmal (1997) investigated the relationship between equity market prices and inflation in Algeria for the period 1971-1996 by employing the autoregressive distributed lag (ARDL) approach to observe cointegration among variables and provided evidence that equity returns are hedged against inflation in the long run. Though the study by Akmal (1997) is important in defining and providing a background for the inclusion of the explanatory variables, this study will adopt a different methodology, thus it is going to use the VAR model instead of ARDL. Mukherjee and Naka (2005) tested the dynamic relationship between six macroeconomic variables and the Japanese stock market, by employing a vector error correction to a model of seven equations. They found that a long-term equilibrium relationship exists between the Japanese stock market and the six macroeconomic variables which are exchange rate, money supply, inflation, industrial production, long-term government bond rate and call money rate. However, using money supply, inflation, government bond rate and call money rate as explanatory variables in one study may bring about the problem of multicollineality. Maysami et al (2006) examined the long run relationship among macroeconomic variables and Stock prices in Angola and found stock prices to have long term relationship with industrial production, inflation, exchange rate, changes in the short and long-term interest rates and money supply. METHODOLOGY The study is going to employ the Vector Auto Regression (VAR) model to model the relationship between stock prices and certain macroeconomic variables. A VAR is an economic model that is used to capture the innovation and interdependency of multiple times series variables. The VAR model, developed by Sims (1980) represents dynamic models of a group of time series. In a VAR model each variable will have its own equation explaining the changes in that variable in question, in response to its own current and past values and the current and past values of all the variables in the model. Unit root tests will be conducted to test the data for stationarity. If the variables are integrated of the same order then a cointegration test will be performed. Definition and Justification of variables The dependent variable is stock prices. Stock prices are estimated by the industrial production total index. The industrial production total index is a proxy for the real activity. It shows the changes in production value added of branches of manufacturing industry. It is computed on the basis of production data collected for about 1500 factories, the production value added of which covers over 75% of the total value created by the manufacturing industry in Zimbabwe. Independent Variables a. Gross Domestic Product (GDP) GDP is a measure of corporate output and activity influencing possible future dividends. Industrial production index has been used as proxy to measure the growth rate in real sector. GDP presents a measure of overall economic activity in the economy and affects stock prices through its influence on expected future cash flows. It is hypothesized that an increase in industrial production is positively related to equity prices. b. Consumer Price Index (CPI) Consumer Price Index is used as a proxy of inflation rate. CPI is chosen as it is a broad base measure to calculate average change in prices of goods and services during a specific period. Inflation is ultimately translated into nominal interest rate and an increase in nominal interest rates increase discount rate which results in reduction of present value of cash flows so it is hypothesized that an increase in inflation is negatively related to equity prices. Inflation is likely to influence stock prices directly through changes in the price level and through the policies designed to control it. c. Foreign Exchange Rate (ER) This study employs foreign exchange rate as end of month US$/Z$ exchange rate. It is hypothesized that a loss in value of the home currency is negatively related to equity prices. A positive relation between the exchange rate and stock prices is conjectured. Persistent devaluation of the Zimbabwe dollar lures people to rather invest in strong international currencies usually by keeping them as idle balances. Thus resources that could be invested on the stock exchange are diverted into non-functioning assets usually comprised of dollars, Rands and pound sterling. Empirical Model The study is going to follow Mishra (1994) to identify factors in the Arbitrage Pricing Theory with macroeconomic variables that have an impact on stock market prices. Most studies employed this model in order to test the impact of macroeconomic variables on stock market prices. As stated in the previous chapter, it has advantages over the CAPM model as it allows the selection of whatever factors provide a better explanation of variations in stock market prices. The regression equation is specified as follows: k Vt = ? At Vt ? i + ? t i =1 V = (CPI , GDP, ER) Where; Vt is a vector of endogenous variables, A 1 -A k are three by three matrices of coefficients and ? t is a vector of error terms. Following Shan et al (2006) the variation is smoothed out in time series variables and further even and make the variables consistent in the model by transforming all of the variables into logarithm format. ESTIMATION OF RESULTS The unit root tests were conducted by applying the Augmented Dickey-Fuller test developed by Dickey and Fuller (1981) to test the stationarity of our variables. If the estimated Augmented Dickey-Fuller statistic is greater than the critical value the null hypothesis that the series is non-stationary in favour of stationarity will be rejected. To deal with the problem of high variability and unevenness of our data, all variables were converted into logs before being subjected to the tests for stationarity. A trend and an intercept were employed for the testing for stationarity in levels and only an intercept for successive test. After running the data, it is only Exchange Rate (ER) that was stationary in levels. All other variables were found to be non-stationary. Appropriate differencing were conducted and it was found that the Stock Price (SP) became stationary after differencing twice, that is , it is integrated of order two I(2). After differencing once, Consumer Price Index (CPI) and the Real Gross Domestic Product (RGDP) were found to be stationary which means they are integrated of order one, I(1) as illustrated Table 1 below. This therefore, means that this study is going to perform the vector autoregression (VAR) analysis without proceeding to conducting the vector error correction (VEC) model. Table 1: Augmented Dickey Fuller (ADF) test results after appropriate differencing. ***Indicating stationarity at 1% level, ** stationarity at 5% level and * stationarity at 10% level of significance Table 2 reports diagnostic test results of residuals of the VAR model. Table 2: Diagnostic Tests of the residuals of the VAR Inspection of the table regarding the VAR shows that the Q-statistic is insignificant at 5% confidence level, with large p-values. Consequently, the null hypothesis, that the residuals of the equations incorporated into the VAR up to order k are not autocorrelated, cannot be rejected. Moreover, the Breusch-Godfrey Lagrange Multiplier is reported. This is also a test of the null hypothesis that there is no serial correlation in the residuals up to the specified order. The reported F-statistics indicate no autocorrelation in the residuals at 5% confidence level. Also, the ARCH test for autoregressive conditional heteroskedasticity was applied. Ignoring ARCH effects may result in loss of efficiency. It is a test of the null hypothesis that there is no ARCH up to order k in the residuals. The reported n*R2 (i. e. number of observations multiplied by R-squared) follows ? 2 distribution with k degrees of freedom. For the estimated VAR the observed value is lower than the critical value. Thus, the null hypothesis that there is no autocorrelation in the error variance is accepted. Impulse Response The long run relations among the variables of the systems have been determined. Subsequently, there should be examined the transmission mechanisms of the shocks among the variables, which determine the time paths of the systems and settle the equilibrium. Table 3 shows the impulse response functions for the variables.