There is no god but Allah

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my website

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Management

Management: Manegement is a process of activities compeleted effectively and efficiently through and by others.
Difference b/w Effectiveness & Efficiency:
Resources & goals:Effectiveness is just concerned with to achieve the goal with given resources.
Efficiency is concerned with to not only achieve the goal but to save something or to get more then the goal.
Input & Output:Effectiveness is concerned with to get well output from a given input.
Efficiency is concerned with to get the maximum output with minimum input.
Do the things right or to do the right things:Effectiveness is concerned eith to do the right things.
Efficiency is concerned with to do the things right.
An eeficient employee is also effective but it is not neccessary that an effective employee is always efficient.
So a good manager should be efficient not only effective.
Manager:Someone who coordinates oversees the work of other people order to accomplish organisational goals.                           OR
A manager is a person who get the work completed with the help of other people.

Flood in Pakistan

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it is a unbelieveable truth to whom u can't forget

Coca Cola

When COCA COLA came in Pakistan?
In 1950s Coca cola started its operations in Pakistan.
In 1996, the coca cola itself took over business operations in Pakistan & setup its 1st production plant in Karachi.
 Now there are 6 production units and 11 distribution units working in Pakistan providing employment to
more than 6000 people.

Economics

Define the following.

PPF, scarcity, productive efficiency, inputs and outputs.

Productive Efficiency:

        When an economy can’t produce more than one commodity without the less production of that commodity than we can say that economy is on its Productive Efficiency.

Example: A person has 20000 RS only. He want to produce 400 kg cheese which cost is 20000 thousand RS but he also want to produce butter so he has to decrease the production of some cheese then he can produce some butter.

             

Scarcity:

             It is the situation in which resources are limited to fulfill the desires.

Example: A person has budget of 15000 monthly he want to afford a car and also have the responsibility of 5 children and a wife if he will purchase and afford the car then it will be difficult for him to purchase other needs like grain, clothes.

Input:

           Raw goods or services which are used to produce useable goods or services.

Example: Like milk is a material to which is converted into cheese then milk is an input and after the processing it will become cheese which is output.

Output:

           Output is the various useful goods or services that come as the result of production process, technical operations and management functions.

Example: Like milk is a material to which is converted into cheese then milk is an input and after the processing it will become cheese which is output.

PPF:

        PPF stands for Production Possibility Frontier. This shows the maximum amounts of production that can be obtained by an economy, given its technological knowledge and quantity of inputs available. The PPF represents the menu of goods and services available to society

EXAMPLES OF POTENTIAL MARKET FAILURE

There are plenty of reasons why the normal operation of market forces may not lead to economic efficiency.

Public Goods 

Public Goods not provided by the free market because of their two main characteristics

• Non-excludability where it is not possible to provide a good or service to one person without it thereby being available for others to enjoy

• Non-rivalry where the consumption of a good or service by one person will not prevent others from enjoying it

Examples: Street lighting / Lighthouse Protection, Police services,  Air defense systems, Roads / motorways, Terrestrial television, Flood defense systems, Public parks & beaches

Because of their nature the private sector is unlikely to be willing and able to provide public goods. The government therefore provides them for collective consumption and finances them through general taxation.

Merit Goods 

Merit Goods are those goods and services that the government feels that people left to themselves will under-consume and which therefore ought to be subsidized or provided free at the point of use.

Both the public and private sector of the economy can provide merit goods & services. Consumption of merit goods is thought to generate positive externality effects  where the social benefit from consumption exceeds the private benefit.

Examples: Health services, Education, Work Training, Public Libraries, Citizen's Advice, Inoculations

Monopoly

Few modern markets meet the stringent conditions required for a perfectly competitive market. The existence of monopoly power is often thought to create the potential for market failure and a need for intervention to correct for some of the welfare consequences of monopoly power.

The classical economic case against monopoly is that

• Price is higher and output is lower under monopoly  than in a competitive market
• This causes a net economic welfare loss of both consumer and producer surplus
• Price > marginal cost - leading to locative inefficiency and a praetor sub-optimal equilibrium.
• Rent seeking behavior by the monopolist might add to the standard costs of monopoly. This includes high (possibly excessive) amounts of spending on persuasive advertising and marketing.
• Libenstein's X-inefficiency may also result if the monopolist allows cost efficiency to drop. An upward drift in costs because of a lack of effective competition in the market-place can lead to consumers facing higher prices and a reduction in their real standard of living

Externalities

Any exam question on market failure must make some reference to externalities. What are the potential market failures arising from externalities?

The social optimum output or level of consumption diverges from the private optimum. 

Main problem is the absence of clearly defined property rights for those agents operating in the market. When property rights are not clearly defined, market failure is likely because producers & consumers may not be held to account

Don't forget that positive externalities can also justify intervention if goods are under-consumed (social benefit > private benefit)

Inequality

Market failure can also be caused by the existence of inequality throughout the economy. Wide differences in income and wealth between different groups within our economy lead to a wide gap in living standards between affluent households and those experiencing poverty. Society may come to the view that too much inequality is unacceptable or undesirable.

Note here that value judgments come into play whenever we discuss the distribution of income and wealth in society. The government may decide to intervene to reduce inequality through changes to the tax and benefits system and also specific policies such as the national minimum wage

GOVERNMENT INTERVENTION AND MARKET FAILURE

Government intervention may seek to correct for the distortions created by market failure and to improve the efficiency in the way that markets operate

• Pollution taxes to correct for externalities 
• Taxation of monopoly profits (the Windfall Tax) 
• Regulation of oligopolies/cartel behavior 
• Direct provision of public goods (defense) 
• Policies to introduce competition into markets (de-regulation) 
• Price controls for the recently privatized utilities