Exercise Tests for Aerobic Capacity | Evaluation

Exercise Tests for Aerobic Capacity | Evaluation Evaluation of Exercise Tests Used to Examine Aerobic Capacity Aerobic exercise was developed by Dr. Kenneth Cooper in 1969, to study why some individuals with superior muscular strength, scored poorly in long distance running, cycling or swimming regimes (Cooper, 1969). Dr. Cooper’s research involved using a bicycle ergometer to measure sustained human performance, in terms of an individual’s ability to utilize oxygen (Cooper, 1969). The data Dr. Cooper collected for his research is the foundation for the development of all modern aerobic tests and programs (Cooper, 1969). Aerobic exercise describes a physical activity performed at moderate levels of intensity for extended periods of time; ultimately increasing heart rate (Donatelle, 1969). This includes exercises like long distance jogging but not sprinting (Donatelle, 1969). In aerobic exercise, glycogen is decomposed to produce glucose; however, when glucose levels are minimal, fat is broken down (Donatelle, 1969). The ability an individual’s respiratory and cardiovascul ar systems can meet the oxygen demands of exercising muscles is called aerobic capacity (NYCFD, 2006). It is the maximum volume of oxygen muscles will intake during exercise (Donatelle, 1969). High aerobic capacity translates to better performance (Donatelle, 1969), not only because oxygen is efficiently delivered to and used by muscles, but also because recovery from extreme efforts by the muscles is faster (NYCFD, 2006). To boost aerobic capacity, heart rate needs to be worked up to 70% to 85% of its maximum; this is known as the heart’s â€Å"Target Heart Rate† or â€Å"Training Sensitive Zone† (NYCFD, 2006). This can be done by participating in aerobic training that recruits large muscle groups, such as those in the legs (NYCFD, 2006). As exercise intensity increases, oxygen consumption (VO2) linearly relates to workload, but only to a certain point, where VO2 plateaus, even as exercise intensity rises (McArdle et al, 2001). This plateau value, known as the maximal oxygen consumption (VO2 max), is synonymous with aerobic power (Peterson, 2004), which is defined as the extent at which aerobic capacity, the peak aerobic energy strength, is exploited (Sports Resource Group, 2003). However, VO2 max is not the only predictor of aerobic capacity (Peterson, 2004); expressed as a fraction of VO2 max (% VO2 max ) (Peterson, 2004), the physiological value (LT), typically known as lactate threshold or anaerobic threshold (Peterson, 2004), also provides valuable information. LT defines situations when glycogen decomposition does not meet the required energy demands of the exercising muscles (Donatelle, 2005), and measures the degree of muscular and metabolic stress during exercise (Peterson, 2004). It is the point above restin g level, when light elevating levels of exercise causes glycogenolysis increases (Peterson, 2004), and lactate begins to accumulate in active muscles and blood (Farrell et al, 1993). Although lactic acid build up is removed gradually by slow oxidative muscle fibers, lactic acid often builds up in muscles before LT is reached (Peak Performance, 2006). Since there is no definitive start point in lactic acid build up, a set lactate accumulation value of 4 mmol/L of lactic acid in the blood is usually used as the point of onset of blood lactic acid (OBLA) (Peterson, 2004). LT is considered to be a more accurate predictor of aerobic capacity than VO2 max, however, it pertains only to the local muscles’ training state (Peterson, 2004). The LT phenomenon helps to explain why individuals with similar VO2 max can differ in endurance performance times (Peterson, 2004); those with a higher LT exhibit better ability to exercise because they use a larger fraction of their aerobic capacity (85-90% VO2 max) (Peterson, 2004). Factors leading to these results include examining whether subjects have undergone previous strength and endurance training in the muscles being analyzed and the percentage of Type 1 muscle fibers in the targeted muscles (Peterson, 2004). Exercise tests that informatively examine aerobic capacity, should help describe the overall changes in the cardiovascular system, as well as the local changes in the muscles, active in exercise (Peterson, 2004). Theses changes, collectively known as adaptations (Peterson, 2004), include increase in plasma volume, blood flow redirection to active muscles, heart size enlargement, heart rate reduction (HR), stroke volume elevation (SV), increase in cardiac output (Q), total muscle blood flow increase during maximal exercise and blood pressure reduction (Peterson, 2004). When capillary density is increased because of aerobic exercise, muscles take in more oxygen (Peterson, 2004). The local adaptations of the muscles that should be regarded as a part of examining aerobic capacity include: increase in the number and size of mitochondria, more carbohydrate oxidation because of increased oxidative enzyme activity, improved fat metabolism, the amount of muscle and type of muscle fiber eviden t during the exercise (Peterson, 2004). Today, common forms of aerobic capacity testing are the treadmill (TM), walk tests and cycle ergometer (CE) tests (Peterson, 2004). These methods are effective because they require the use of large muscle groups and are also cheap and straightforward enough for subjects to handle (Peterson, 2004). In all incidences, the clinical exercise testing protocols would involve initial warm-up; gradual increasing loads of uninterrupted exercise, with adequate duration per level; and finally a recovery period (Fletcher et al, 1995). Endurance running can be defined as maintainable velocity over a given distance (Peterson, 2004). Measuring aerobic capacity using treadmill facilitated tests require subjects to walk at a light pace, then gradually pickup the workload at set time intervals (Donatelle, 1969). The equipment used is an accurately calibrated, standard treadmill with variable speed and grade capability (Fletcher et al, 1995). Subjects should refrain from tightly grasping handrails on the treadmill during the test, as this results in decrease in VO2 and increase in muscle exertion and exercise time (Fletcher et al, 1995). The duration of an average protocol is 6 to 12 minutes (Fletcher et al, 1995), but a number of different protocols exist, varying in the increments of time or amount of increase in workload (Fletcher et al, 1995). The ideal protocol however, should be tailored to the type of subject being tested (Fletcher et al, 1995). The values usually measured in TM tests, VO2 and peak cardiac power output (CPOmax) , (Fletcher et al, 1995), give an idea about an individual’s aerobic capacity, and are used as data for many different studies. For example, studies have used TM tests to determine aerobic capacity of subjects (Williams et al, 2001 and Cooke et al, 1998). Their data gave evidence that CPOmax during exercise, was significantly related to aerobic capacity and also correlated to exercise duration (Williams et al, 2001 and Cooke et al, 1998). CPOmax was found to be an independent mortality predictor (Williams et al, 2001), and using TM cardiopulmonary exercise testing is beneficial because it is non-invasive, therefore less stressful for patients to participate (Williams et al, 2001 and Cooke et al, 1998). This finding was consistent in a population of normal subjects and individuals with heart disease (Cooke et al, 1998), and ultimately gave a more definitive idea about the extent of cardiac impai rment of patients with heart failure (Williams et al, 2001 and Cooke et al, 1998). A lower impact alteration of the TM test is the six minute walk test (6MWT), which is cheaper and simpler to conduct (American Thoracic Society, 2002). This test is usually used on patients with health problems, and measures the distance of hard, flat surface subjects can briskly over in 6 minutes (American Thoracic Society, 2002). The test is useful for evaluating the body’s overall and local adaptation responses involved in exercise (American Thoracic Society, 2002). This includes pulmonary and cardiovascular systems, systemic circulation, peripheral circulation, blood, neuromuscular units, and muscle metabolism (American Thoracic Society, 2002). However, since the 6MWT evaluates the submaximal level of functional capacity (American Thoracic Society, 2002), information generated is not specific about the causes of limitation (Johnson, 2004). Measuring performance at submaximal levels of exertion, the 6MWD gives a good indication of the level of functional exercise in daily physical activities (American Thoracic Society, 2002). However, for patients with severe chronic obstructive pulmonary disease (COPD), the test generates a similar stress as a maximal test (Johnson, 2004). In studies conducted using a population of patients with cardiac and or respiratory problems (Solway et al, 2001), the 6MWT was established to be the easiest to administer, most tolerated by patients and most reflective of daily activities, out of 2-min walk tests (2MWT), 12-min walk tests (12MWT), self-paced walk tests (SPWT), and shuttle walk tests (SWT) (Solway et al, 2001). In order to study the effects aerobic and strength training have on improving aerobic endurance and muscle strength in female cardiac transplant recipients (Haykowsky et al, 2005), the 6MWT was administered to measure cardiac transplant patients’ aerobic endurance befor e and after placing them in aerobic training programs (Haykowsky et al, 2005). However, firm conclusions on the usefulness of the test in clinical practice, are still lacking (Opasich et al, 2001). In a study to investigate the correlation between walk test performance, cardiac function and exercise capacity (Opasich et al, 2001), it was found that for moderate to severe chronic heart failure patients, the 6-min walk test is not related to cardiac function and only moderately related to exercise capacity (Opasich et al, 2001). Therefore, the paper deemed the test to have only limited usefulness as a decisional indicator in clinical practice (Opasich et al, 2001). Some disadvantages of the 6MWT is that being a time controlled test, the only way a subject can show improved aerobic capacity in subsequent testing, is by walking faster (Johnson, 2004). However, for some COPD patients, walking faster is difficult due to factors such as stride length (Johnson, 2004); a TM test on the other hand can accommodate for a steeper grade, hence allowing patients to show improvements in their overall condition (Johnson et al, 2002). TM testing can be deemed better than 6MWT as it is more versatile; it can be used with or without advanced monitoring such as continuous electrocardiography or expired gas analysis (Johnson, 2004). However, TM tests are more expensive and require more expertise (Johnson, 2004). Although 6MWT is a good test to repeat for the purposes of documenting decline in exercise tolerance (Johnson, 2004), TM tests are better at documenting improvements in function because they test at constant workload, and is therefore more sensitive (Johns on, 2004). For individuals untrained in cycling, VO2 max is higher when tested on TM compared to CE (Peterson, 2004), while trained cyclists generated only slightly higher VO2 max values when tested via CE compared to TM (Peterson, 2004). VO2 values from TM tests are generally higher than those attained from CE protocols (McArdle et al, 2001). The cause is because most individuals are more comfortable walking or running, as oppose to cycling (McArdle et al, 2001). It could also be because CE testing causes discomfort and fatigue of the quadriceps muscles (Fletcher et al, 1995). Leg fatigue of an inexperienced cyclist causes subjects to stop before reaching a true VO2max (Fletcher et al, 1995), making the value 10% to 15% lower in CE than TM tests (Fletcher et al, 1995). In cycling terms, endurance performance is the power output maintained for a given time (Peterson, 2004). CE tests require an initial power output of about 10 or 25W, followed by a 25W increase in 2 to 3 minute increments (Fletcher et al, 1995). Arm ergometry would require a similar approach, but with a smaller initial power output and lower incremental increases; usually every 2 minutes (Franklin, 1985 and Balady et al, 1985). Studies have also shown that it is possible to measure actual aerobic capacity in a single session by continuously increasing the load (Birkhorst Leeuwen, 1963). The equipment used for CE tests can either be mechanical or electrically braked cycles with adjustable variable force on the pedals (Fletcher et al, 1995). The highest values of VO2 and heart rate can usually be obtained with pedaling speeds of 50 to 80 rpm (Fletcher et al, 1995). The cycles are calibrated in kilopounds (kp) or watts, where 1 W corresponds to about 6 kilopound-meters per minute (kpm/min) (Fletcher et al, 1995). This can be converted to oxygen uptake in milliliters per minute for aerobic capacity measurement purposes (Fletcher et al, 1995). A cycle ergometer is usually less expensive, more space efficient and less noisy than a treadmill (Fletcher et al, 1995). Other advantages of CE tests are that upper body movement of subjects’ are reduced, which facilitates measurements in blood pressure and making ECG recordings (Fletcher et al, 1995). CE tests also give precise quantization of external work, ultimately facilitating the calculation of certain parameters for aerobic capacity examination (Johnson, 2004). Like the TM test, it is important that subjects refrain from exercising their arms in a resistive fashion, because this results in attaining inaccurate data for aerobic capacity (Fletcher et al, 1995). In studies of patients with COPD, in addition to being inconsistent with patients’ normal activities, CE tests are less commonly used because they produced significant respiratory differences when compared with walking tests (Johnson, 2004). However, CE tests have been useful for identifying that the pathology of Gulf War veterans (GV) with chronic fatigue syndrome (CFS), do not show a decreased aerobic capacity like most normal CFS patients (Nagelkirk et al, 2003). Overall, although TM, 6MWT and CE tests are all used to examine aerobic capacity, there are fundamental differences between the three tests (Peterson, 2004); these include differences in the muscle group exerted, pattern of muscle use, contraction speed and time of muscles and the metabolic processes (Peterson, 2004). In summary, TM and walking tests are more likely to identify oxygen desaturation (Turner et al, 2004). 6MWT is the easiest test to perform (Turner et al, 2004), and is adequate for most purposes (Johnson, 2004). However, depending on how and what the data from the aerobic capacity testing is used for, an important factor for choosing the most suitable test is the population of subjects being observed. References American Thoracic Society 2002, ‘ATS Statement: Guidelines for the Six-Minute Walk Test’, American Journal of Respiratory and Critical Care Medicine, vol. 166, pp. 111-117, viewed 24 23 April 2006, http://ajrccm.atsjournals.org/cgi/content/full/166/1/111.pdf> Balady G.J., Weiner D.A., McCabe C.H., Ryan T.J. 1985, Value of Arm Exercise Testing in Detecting Coronary Artery Disease, Am. J. Cardiol., vol. 55, pp. 37-39. Birkhorst R.A., and Leeuwen P.V., 1963, ‘A Rapid Method for the Determination of Aerobic Capacity’, European Journal of Applied Physiology, vol. 16, no. 6, pp. 459-467, viewed 22 April 2006, http://www.springerlink.com/media/16jvphlgmre1hfpuupvn/contributions/v/5/0/2/v502752208v3240h.pdf> Cooke G.A., Hainsworth R., Marshall P., Tan L.B., Al-Timman J.K., Riley R., Wright D.J. 1998, ‘Physiological Cardiac Reserve: Development of a Non-Invasive Method and First Estimates in Man’, Heart, vol. 79, March, pp. 289-294, viewed 23 April 2006, http://heart.bmjjournals.com/cgi/content/full/79/3/289> Cooper K., Aerobics, New York: Bantam Books, 1969 Donatelle R.J 1969, Health: The Basics, 6th ed. San Francisco: Pearson Education Inc., 2005. Farrell P.A., Wilmore J.H., Coyle E.F., Billing J.E., and Costill D.L. 1993, Plasma Lactate Accumulation and Distance Running Performance; 1979, Med. Sci. Sports Exerc.,vol.25, no. 10, pp. 1091-1097 and 1089-1090. Fletcher GF, Balady G, Froelicher VF, Hartley LH, Haskell WL, Pollock L. 1995, ‘Exercise standards: A statement for healthcare professionals from the American Heart Association’. Circulation, vol. 91, pp 580-615, http://circ.ahajournals.org/cgi/content/full/91/2/580?ijkey=0811df26787e2a783372541f0bbaae62282badf6keytype2=tf_ipsecsha> Franklin B.A. 1985, Exercise Testing, Training and Arm Ergometry, Sports Med., vol. 2, pp. 100-119. Haykowsky M.., Figgures L., Jones L., Kim D., Riess K., Tymchak W., Warburton D. 2005, ‘Exercise Training Improves Aerobic Endurance and Musculoskeletal Fitness in Female Cardiac Transplant Recipients’, Curr Control Trials Cardiovasc Med, vol.6, no. 1, pp. 6-10, viewed 22 April 2006, http://www.pubmedcentral.nih.gov/picrender.fcgi?artid=1166569blobtype=pdf> Johnson J.E. 2004,Which Exercise Test Should Be Used for Patients with Symptomatic COPD, Chest, vol.126, pp. 668-670, viewed 23 April 2006, http://www.chestjournal.org/cgi/reprint/126/3/668.pdf> Johnson J.E., Gavin D.J., Adams-Dramiga 2002, ‘S Effect of Training with Heliox and Noninvasive Positive Pressure Ventilation on Exercise Ability in Patients with Severe COPD’, Chest, vol. 122, pp. 464-472. McArdle W.D., Katch F.I., and Katch V.L. 2001. Exercise Physiology: Energy, Nutrition, and Human Performance; Chapter 7 Oxygen Consumption. Baltimore: Lippincott Williams Wilkins. (NYCFD) New York City Fire Department 2006, Aerobic Fitness; To Improve Aerobic Capacity, New York, viewed 24 April 2006, http://www.nyc.gov/html/fdny/html/fitness/fitness_aerobic.shtml>. Opasich C., Capomolla S., Cobelli F., Febo O., Forni G., Pinna G.D., Mazza A., Riccardi R., Riccardi P.G., and Tavazzi L. 2001, ‘Six-Minute Walking Performance in Patients with Moderate-to-Severe Heart Failure: Is it a Useful Indicator in Clinical Practice?’ European Heart Journal, vol. 22, pp. 488–496, viewed 22 April 2006, http://eurheartj.oxfordjournals.org/cgi/reprint/22/6/488.pdf> Peak Performance 2006, Fitness Testing; Critical Swim Speed, United Kingdom, viewed 21 April 2006, http://www.pponline.co.uk/encyc/0162.htm> Peterson A. 2004, Can endurance running performance be predicted from cycling performance? Curtin University of Technology; School of Physiotherapy, viewed 22 April 2006, http://physiotherapy.curtin.edu.au/resources/educational-resources/exphys/00/specificity.cfm> Solway S., Brooks D., Lacasse Y., and Thomas S. 2001, ‘A Qualitative Systematic Overview of the Measurement Properties of Functional Walk Tests Used in the Cardiorespiratory Domain’. Chest , vol. 119, pp. 256-270, viewed 22 April 2006, http://www.chestjournal.org/cgi/reprint/119/1/256.pdf> Sports Resource Group Inc 2003, Lactate Testing for Triathlon Coaches A Framework for Testing, Lactate.com, viewed 23 April 2006, http://www.lactate.com/triathlon/trtest.htm> Turner S.E., Eastwood P.R., Cecins N.M., Hillman D.R., Jenkins S.C. 2004, Physiologic Responses to Incremental and Self-Paced Exercise in COPD: A comparison of Three Tests, Chest, vol. 126, no.3, pp. 766-73. Williams S.G., Cooke G.A., Marshall P., Parsons W.J., Riley P., Tan L.B., and Wright D.J. 2001, ‘Peak Exercise Cardiac Power Output; A Direct Indicator of Cardiac Function Strongly Predictive of Prognosis in Chronic Heart Failure’, European Heart Journal, vol. 22, pp. 1496-1503, viewed 23 April 2006, http://eurheartj.oxfordjournals.org/cgi/reprint/22/16/1496.pdf>

Homosexuality in the Christian Church Essay

Homosexuality is defined as consistent fantasy, interest and arousal toward a person of the same sex. Disagreement exists about the explanation of homosexuality. On the other hand, evidence supports the fact that homosexuality has existed throughout the history of humankind and is not just a development of the 20th century. Early psychoanalytic theory concluded that homosexuality developed from conflicts derived from early developmental disturbances. Investigators more in recent times have explored neuroendocrine explanations as a cause of homosexual development. The results of these studies have been controversial. On the other hand, a lot of experts believe that sexual orientation, whether heterosexual or homosexual, is the consequence of a multifaceted interface flanked by anatomic and hormonal influences during fetal growth. As investigators attempt to reply the question of etiology, others have worked to further define the incidence of homosexuality. Cognitive and communal expansion throughout adolescence is an intricate progression characterized by the acquisition of a sense of self-separate from family, a sexual independence, the capacity for intimacy and the ability to be autonomous. (The Christian Science Monitor) For those young people who grow a homosexual orientation in a society based on heterosexuality, the changeover all the way through adolescence is expanded and expressed to some extent in a different way throughout the stage of acquiring a sexual uniqueness. Interviews with gay and lesbian youth specify a general pattern in which an adolescent accepts his or her own homosexuality. It is the sexual orientation toward people of the same sex. Homosexuality contrasts with heterosexuality, sexual orientation toward people of the opposite sex. People with a sexual orientation toward members of both sexes are called bisexuals. Female homosexuals are often called lesbians. In modern years, the word gay has been applied to both homosexual men and women. Homosexuality appears in almost all societal contexts within unlike community settings, socioeconomic levels, and cultural and dutiful groups. The number of homosexuals in the inhabitants is not easy to find out, and dependable data do not subsist. Nevertheless, current estimates propose that the term homosexual may relate to 2 to 4 percent of men. Estimates for lesbians are lesser. Not all people who slot in homosexual commotion essentially classify themselves as homosexual. (Zgourides, G. ) The move toward greater unity among Protestant denominations has continued in the 21st century; however, within denominations there is still conflict between conservatives and moderates or liberals. One for the most part divisive issue is homosexuality. Denominations debate whether to ordain practicing homosexuals and whether to bar clergy from performing same-sex marriage ceremonies. Some churches condemn all homosexual activity, while others refuse to do so. Consequently, according to the same religious law that many of them use when religiously citing the gay and lesbian community, countless, reputable Christian leaders today, especially within African America, are in a word adulterers. However, you will not readily read of religious leaders publicly denouncing the social and spiritual validity of their fellow divorced clergy who have married more than once, like you will their `cry loud and spare not’ public cries relating to gay and lesbians desiring the equal choice and right to marry only once. There exists no evidence that suggests Jesus ever discussed same-sex anything, publicly or privately, during his ministry. However, Christ, the bedrock of modern-day Christianity, did publicly condemn religious leaders of his age for granting bills of divorcement. However, wading through all the hype in the media these days one might just conclude the opposite. (Knutson, D. C. ) It is considered an act of unconditional grace to say that the immeasurable, unmerited grace available from God stops only at the sin of adultery. Does God’s amazing grace cover only those sins of Old Testament law that are socially comfortable by today’s standards? Let me put it another way: Is divorce (absent of unfaithfulness) a sin? Many Christians might respond, and there is plenty of scripture to back that up. Then will God consider the bed of that remarried person defiled? Most would probably respond, No, absolutely not, because of the New Testament law of grace, and there is plenty of scripture to support this. Christian churches historically have discriminated, excluded, and persecuted homosexuals on the basis of their sexuality. The emergence of new social attitudes and modernization has contributed to the easing of such taboos. However, the role of the church to defend minorities has led to serious conflicts between the gay community and the church’s prohibition of homosexuality. Within the Christian churches, homosexually oriented people have been excluded, marginalized and persecuted in the great majority of cases. The relatively few exceptions, which are known, are seldom taken into account. John Boswell, from whom the most important studies in this area have come, has found examples of liturgical forms for the union of same-sex partners from the churches of Asia Minor. Nevertheless, it must be said in general that in societies, which have morally proscribed homosexual relations, treated them as taboo or legally forbidden them, the sexual ethic upheld by the churches has not represented a divergent position. (Bauserman, R. ) New reflection by the churches in this area began only under the influence of a shift in social attitudes towards sexuality. The processes of modernization and secularization were accompanied by a removal of sexuality from the realm of taboo and a new respect for the private sphere. Furthermore, since the end of the 19th century modern sexual research has brought new insights into how the sexual identity of persons is formed. In addition, constitutional provisions guaranteeing the rule of law have made it possible for the first time for homosexual people to organize and struggle publicly for the abolition of discriminatory laws and regulations. For the most part the churches have supported the decriminalization of homosexuality only hesitantly. Nor was this new orientation primarily the consequence of new biblical insights or spiritual experiences; rather, the reconsideration was touched off by other factors. In the first place, personal encounter with gay or lesbian people, once they no longer had to conceal themselves but could begin to speak for themselves, was certainly important. As a rule, living alongside homosexual persons on the job, in the neighborhood, within the circle of friends or relatives leads to a reconsideration of traditional social or individual prejudices. A second factor was the exposure of individuals or groups in a good number of churches and congregations to the investigations and findings of modern empirical research on sexuality. However, this research is academically institutionalized (usually in connection with faculties of medicine) in only a few countries; and church declarations on sexual ethics draw explicitly on scientific sexological research only rarely and usually in passing. Finally, it should be noted that quite a few churches have accepted the decriminalization of homosexuality and the principle of non-discrimination against people because of sexual orientation through decisions by their competent governing bodies without however immediately reconsidering their own moral convictions and reservations on the issue. Churches time and again have a great deal of freedom for autonomous structuring of their ordinances and especially their offices. They should work at abolishing any remaining discrimination because of individual sexual orientation in the right to hold office and accept homosexual persons as office-bearers of course, as in the case of all office-bearers, according to the measure of their suitability for the growth of the community. (Boswell, J)

Shareholder value analysis of carphone warehouse - Free Essay Example

Sample details Pages: 7 Words: 2115 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? The chosen company for our shareholder value analysis is Carphone Warehouse Group Plc. The company has outstanding growth and has a dominant market position. It is the largest independent mobile retailer in Europe. After reviewing the latest Annual reports between 2000 2009, the model is used to calculate the shareholder value minus the estimate of total corporation value. Here are the 10 steps used to calculate the Shareholder value analysis for Carphone Warehouse Group Plc. Step 1: Calculate weighted average Cost of Capital Weighted Average cost of capital (WACC) = Ke * We + Kd * Wd Where, Ke stand for cost of equity Kd stands for cost of debt We stand for weight of equity proportion to total capital structure Wd stands for weight of debt proportion to total capital structure The figure below shows the WACC in detail. Don’t waste time! Our writers will create an original "Shareholder value analysis of carphone warehouse" essay for you Create order step 1 calculate WACC  wacc = ke *we+kd*wd risk free rate = 3.50% FTSE return = 9% beta = 101%  ke = 3.5%(101%*9%-3.5%))  gross debt = 5% tax adjustment = (1-28)  kd = 5%*0.72% =  debt to equity ratio = 20:80  we = 80%  wd = 20%  WACC = (9.6%*80%)+(3.6%*20%) = 8.4% Step 2: Calculate Future Turnover Total turnover for the year = Turnover for the last year + increase (turnover of the last year * growth rate) The assumption of the growth rate was calculated using the previous annual records for the company. This is given in the SVA model and shows to be 24.37% This was then used to calculate an estimated forecast of turnover for the next 7 years. Step 3: Calculate Operating Profit We calculated the average profit margin using the previous 10 years of data; hence using the change in percentage from previous year we used the average of that as our rate of profit margin which is 2.18%. We then used the forecasted turnover from step 2 and multiplied this to the profit margin to calculate the forecasted profits for the next 7 years pre tax. Step 4: Calculate After-Tax Inflow This step was used to calculate the post tax of estimated profits. We got our results by multiplying the pretax profits with the tax rate of 28%; we then subtracted the tax worked out from the post tax profit to get the post tax inflow. Step 5: Calculate Incremental Investment Needs We first calculated the working capital investment rate, we did this by dividing the turnover with working capital per year from 2000 2009 as a percentage and then we used the average percentage as our working capital rate. This was then used to used to work out the capital required, we did by multiplying the turnover per forecasted year by the working capital rate (6.2%). Step 6: Calculate Free Cash Flow (FCF) FCF = After-tax inflow [fixed investment cash outflow + working capital Investment cash outflow] Free cash flow measures how much money a company generates after deducting maintenance. FCF is important as it allows the company to pursue opportunities that will enhance the shareholders value. Step 7: Calculate Present value of future cash flow in seven years Discount the future cash flow based on weighted average cost of capital PV of FCF for each year= FCF *Discount Factor Total Present value of Future cash flow for seven years = FCF year 1 / ( 1+WACC) + FCF year 2 1/(1 +WACC)^2 + FCF year 3 1/(1 +WACC)^3+ FCF year 4 1/(1 +WACC)^4+ FCF year 5 1/(1 +WACC)^5+ FCF year 6 1/ (1 +WACC)^6 = 2677003479.09 Step 8: Calculate Business Value First calculate PV of RV which equals to after tax inflow divided by WACC (calculate from step 1) then the result to be multiplied by the discount factor. Present value of Residual value can be calculated as the form of perpetuity. There is assumption made that the cash flow after seven years would be constant amount and forever, which the definition of perpetuity is and it can be calculated using formula. Business Value = Cumulative PV of FCF + PV of RV Therefore, total Business Value = 26770034791 + 69502852504= £ 96272887295 Step 9: Calculate Corporate Value The total corporate value is the sum of Business value and the Marketable securities like equities offered by the corporation. Marketable security is used as of year 2009  £ 872000000.00 Corporate Value = Business Value + Marketable Securities (investments)  £ 96272887295 +  £ 872000000.00 Therefore, Corporate value =  £97144887294.68 Step 10: Calculate Shareholder Value Shareholder Value = Corporate Value -Total Debt Total Debt = Long term + Short term Total Debt = 425000000 + 33000000 = 458000000 Corporate Value=  £97144887294.68 458000000 Total Shareholder Value =  £ 96686887295 Part A (2) ÃÆ' ¢-  The growth rate This was calculated based on the previous 9 years of annual revenue of the company. The annual Growth rate was worked out using the average percentage of change between 2 financial years, i.e. 2001-2000. The growth rate is 24.37% The growth rate is moderately high and that is largely to the fact that the company has expanded with its venture with Best Buy in the United States. We thought about not including the 2009 annual figures within our model but then decided using our judgment that it would be best to use them. The assumption here is that the mobile phone industry is expanding globally which are good future prospects for the sales of independent retailers of mobile phones and electronics. ÃÆ' ¢-  profit margin (pre tax) : We used the the profit margins from the annual reports dating back to 2000, and worked out the average of 2.18%. In my opinion this rate is a more realistic value even though the comp any is showing high sales growth. ÃÆ' ¢-  tax rate Here, is the assumption made that Taxes is depend on the Revenue and it is assumed that tax rate will be constant for the seven year period but the total amount of tax paid each year will vary based on the growth of revenue. we have assumed that the tax rate in countries other than UK averages 28% as well. This is because of lack of information on the international operations and taxation of  CWG  and because the majority of the business of  CWG  after the joint venture in the States is now in UK. Therefore we have not included any other taxes regarding taxation. ÃÆ' ¢-  fixed capital investment rate To calculate the fixed capital investment forecast the fixed capital in terms of plants , machinery fixed assets will be used for seven year time period. The expected future growth rate is calculated similarly from compounded annual growth rate in which annual growth is assum ed to constant but it can vary with in the year period. The assumption is that the organization fixed assets requirement will be similar in the past. ÃÆ' ¢-  Investment in working capital rate Here, is the assumption made that working capital requirement will depend on the Revenue and it is assumed that growth rate will be constant for seven year period but the total amount of investment in working capital each year will be varied based on the growth of revenue. Thus, to calculate the investment in working capital the growth rate used is the sales growth rate. Part A(3) Report to the director This report will be outlining the main constraints of the valuation model and how risk and uncertainty could be incorporated into the valuation process. The valuation module indicates that Carphone warehouse will be succeeding in the foreseeable future. However the future results are assumptions that we have calculated using formulas. Many factors can influence changes that are out of our control such as environmental, political, economical and technical factors. Risks may arise from any of those factors listed above. The awareness on shareholder value does not take into account societal needs. Shareholder value financially benefits only the owner of t he corporation; it does not provide a clear measure of social factors such as employment, environmental issues, or ethical business practices. As a result, a management decision can exploit shareholder value while adversely affecting third parties, including other companies. Shareholder value is a term that suggests that the decisive measure of a companys success is how well it enriches its shareholders. Shareholder Value Analysis is one of a number of techniques used as substitutes for traditional business measurements In May 2008 Carphone Warehouse merged into two commercial agreements with Best Buy, a leading US consumer electronics retailer, also launching Best Buy Mobile an independent retail format in the US. They also invested in a launch of a Geek Squad, a home technology support business, in the UK, to assist customers with their increasingly complex home technology needs. The key component of the valuation module is the estimation of future cash flows, it can be extremely difficult to complete accurately, and the risk of this can lead to incorrect or misleading figures forming the basis for strategic decisions. When calculating the figures we found difficulty as a group finding data as well as understanding the formulas to calculate the organizations shareholder values. It can be extrem ely difficult to estimate future cash flows accurately. The limitations we faced was dependent heavily on two key drivers, cost of capital and planning horizon as well as non cash measures such as operating profit margin due to the difficulties of finding information and the importance of having the information in the method to enable us to complete the formulas and accomplish affective results. We understood the importance when planning is to adopt the shareholder value as a significant financial objective and the implications and best approach for our chosen business Carphone Warehouse. Part B THE VALUATION METHODS NAV Long Term Liabilities  Long Term Debt -425 Group Loans (long t.) 0 Director Loans (long t.) 0 Hire Purch. Leas. (long t.) 0 Hire Purchase (long t.)  Leasing (long t.)  Other Long Term Loans -425 Total Other Long Term Liab.  Accruals Def. Inc. (l. t.)  Other Long Term Liab.  Provisions for Other Liab.  Deferred Tax  Other Provisions  Pension Liabilities  Balance sheet Minorities  Long Term Liabilities -425   Total Assets less Liabilities 1,116 Shareholders Funds  Issued Capital 1 Ordinary Shares  Preference Shares  Other Shares  Total Reserves 1,115 Share Premium Account 476 Revaluation Reserves 0 Profit (Loss) Account 690 Other Reserves -51 Shareholders Funds 1,116 Taking Carphone Warehouse 2009 accounts the NAV per share is: 1116/914108246= 1.22p per share Net asset value is a term used to describe the value of an entitys assets less the value of its liabilities. In the case of no-load funds Carphone Warehouses NAV, market price, and offering price are the entire matching figure, which the public pays to buy shares, offer prices are quoted after adding the sales charge to the net asset value. NAV is calculated by most funds after the close of the exchanges each day by taking the closing market value of all securities owned plus all other assets such as cash, subtracting all liabilities, and then dividing the result by the total number of shares outstanding. The number of shares outstanding can vary each day depending on the number of purchases and redemptions. This is not very successful and commonly used approach as it has many drawbacks and limitation. It does not take into account of time value of money. It also not concerned about the capital structure of firm has. Price earnings ratio P/E Ratio = Market Price EPS P/E ratio = 194.40p/ 347million/914108246= 194.40/0.3796= 512.11 times The P/E ratio of a stock is a measure of the price paid for a share relative to the annual net income or profit earned by the firm per share. The P/E is usually based on earnings from the last four quarters; the P/E is more than a measure of Carphone Warehouses past performance. It also takes into account market expectations for  a companys  growth. Carphone warehouse stock prices reflect what investors think a company will be worth. Future growth is already accounted for in the stock price. As a result, a better way of interpreting the P/E ratio is as a reflection of the markets optimism concerning a companys growth prospects. If a company has a P/E higher than the market or industry average, this means that the market is expecting big things over the next few months or years. A company with a high P/E ratio will eventually have to live up to the high ra ting by considerably increasing its earnings, or the stock price will need to fall. Discounted Cash Flow Basis Free cash flows: Revenues less operating costs plus depreciation less investment expenditure Revenue =347 million operating costs= -771million depreciation= 54 million investment expenditure= 872 million 347m 771m + 54m 872m = 7560000 P/E is short for the ratio of a companys share price to its per-share earnings. As the name implies, to calculate the P/E, you simply take the current stock price of a company and divide by its earnings per share Discounted Cash Flow is a cash flow summary  adjusted to reflect the time value of money.  DCF is an important factor to Carphone Warehouse when  evaluating or comparing investments, proposed actions,  or purchases, Other things being equal, especially in 2009 when Carphone Warehouse emerged with a company called best way in America. The  action or investment with the larger DCF is the better decision. When  discounted cash flow events in a cash flow stream are added together, the result is called the Net Present Value.

Fast Food Industry Essay - 724 Words

It is not a surprise that fast food has become a way of life in America. Every day about a quarter of the adult population n United States visits the fast food restaurant. Every month about 90 percent of children aged 3-9 visit McDonalds. According to Schlosser, Americans spent more than $110 billion a year on the fast food. In his book Fast Food Nation Eric Schlosser is not chiefly interested in the consumption of fast food, but his primary objective is to explore manufacturing starting with the unemployment. His book deals with United States politics and raises many social issues. It has been estimated that one out of eight workers at some point of their career worked at McDonalds. Today there are approximately 3.5 million†¦show more content†¦Schlosser makes a statement that fast food has changed the society and popular culture. He strongly believes that this industry is exploiting teenagers and minorities. Who is guilty? Is it executives? Schlosser says that the executives who run the fast food industry are not bad men. They are businessmen. They will sell free-range, organic, grass-fed hamburgers if you demand it. They will sell whatever sells at a profit . The social position of service workers is of primary importance for the author in trying to inform the reader about negative sides of the fast food industry. In 1998, according to Fast Food Nation, more restaurant workers were murdered on the job in the United States than police officers. Fast food industry often hires young, poor and disabled not because it is such a good industry, but because it gains government subsidies for training. The author tells the reader about how industry has fought unions and how it does benefit from hiring teenagers. The author continues that US teens are injured on the job twice the rate of adult workers. The jobs are kept mechanized to be able to change cheap workforce quickly instead of hiring well-trained and informed specialist who might demand insurance and higher wages. In addition, in this book the author examines the rise of fast food and careers of Ray Kroc and others . Schlosser agreesShow MoreRelatedFast Food And The Food Industry1642 Words   |  7 PagesThe majority of Americans enjoy fast food like bees enjoy their honey. Fast food is hard not to love due to families experiencing fast paced days, parents who work more than 20 hours a week, and having children with picky appetites can be rough. For most American families, it can be a challenge to not consider eating fast food more than once a week. The fast food industry has grown tremendously through the years. The one restaurant that is known all over the world for their golden arches and theirRead MoreFast Food Industry1506 Words   |  7 PagesTable of Contents: 1) Executive Summary †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦P.2 2) Industry Structure Analysis †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦P.2 3) Five Force Model †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.P.3 4) Comparative industry structure analyses †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.P.5 5) Critical Success Factors Now ...†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦Ã¢â‚¬ ¦P.5 6) Critical Success Factors in Future...†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦Ã¢â‚¬ ¦.P.7 7) Conclusion †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦P.8 6) Appendix †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..P.9 Executive Summary: Hong Kong is a city in which efficiency and speed areRead MoreThe Fast Food Industry Essay2085 Words   |  9 Pagesyears old, I got my first job at the most wonderful fast food restaurant ever, Cookout. This was not an ideal job for a 16-year-old. Most teens dream of their first job being in their favorite clothing store, or maybe even their favorite grocery store. I was that teen, but where I am from there are very limited options for 16 year olds so I had to just settle for a fast food restaurant. We have all heard these typical assumptions about fast food employees, they are all uneducated, they work too hardRead MoreFast Food And The Food Industry979 Words   |  4 Pagesyou see one of the fifty thousand fast food chains in the United States alone (Ransohoff). It might be easy to resist the cheap and easy deliciousness of a McDonald’s cheeseburger for a while, but then you have a long day and cooking seems too tedious for the amount of energy you actually have. Or you a re out with friends and the only food options are fast food. That is okay! Today, healthier food options are more accessible in and out of the fast food industry. In today’s world of technology andRead MoreFast Fashion On Fast Food Industry2279 Words   |  10 PagesSlow Fashion Fast fashion is a force that needs constant change from retailers; new garments and new trends cycle out as fast as a bi-weekly basis, putting pressure on the industry to sell fast and cheap to the consumer. However, with the news publishing more articles about the working conditions in factories, comparable to the Rana Plaza disaster in Bangladesh, and the run-off pollution these factories produce, the consumer is demanding more transparency in the supply chain. The introduction toRead MoreEssay on Fast Food Industry968 Words   |  4 Pagesworld has become so fast paced that everything is rushed. Almost every aspect of life has become industrialized. Food and the way it is prepared is no exception to this world that always appears to be in fast forward. The fast food industry has revolutionized how and what people eat. The public has begun to consume more fast food and the problem is that people do not know what they are eating. If the concept of a nutritious meal is thrown out th e window for the convenience of fast food then the healthRead MoreThe Fast Food Industry1246 Words   |  5 Pageschanged their spending habits in particular food. This has lead fast food joints to profits, proving that there is an upside to our low economy Todays industry faces high real-estate prices and highway strips teeming with fast-fooleries, there is now one restaurant for every 2,700 Americans, compared with one for every 7,000 in the late 1970s (Clark). Chains have been branching out into sports arenas, airports, hospitals, colleges, turnpike stops, mall food courts, kiosks, airline in-flight meal servicesRead MoreFast Food And The Kingdom Of The Fast Foods Industry1532 Words   |  7 Pagesof the fast food industry. Since White Castle, which was known as the first fast food chain in the United States, was established by Walter Anderson and Edgar Waldo â€Å"Billy† Ingram in 1921 (Kieler), other fast food chains also emerged such as McDonalds, Taco bell, Burger Ki ng, or Wendy’s after 1941 (Wilson). Among those various fast food chains, especially, McDonalds became the biggest fast food chain not only in the overall America but also all around the world (Wilson). Nowadays, fast food is servingRead MoreThe Effects Of Fast Food On The Food Industry2319 Words   |  10 Pagespresent themselves (What Causes Obesity, 2006). Advertisements in the fast food industry are persuading people to eat their greasy, fat, salty, unhealthy foods (McDonald’s Advertising Themes, 2013). In order for people to live a happy, healthy life, they must change their eating habits. However, fast food advertisements are contributing to what is making eating habits so hard to change, with their misleading advertising. Fast food is slowly but surely killing us, yet we hardly notice until it finallyRead MoreThe Fast Food Industry Essays1646 Words   |  7 PagesThe dagger of the people is always twisting and changing the fast food world. Fast food itself has always been changing due to social, economic, and health concerns. To begin I will cover the origins of fast food, followed by a brief discussion about McDonalds as well as Burger King. This will be accompanied by a brief discussion on Taco Bell, with our final subject covering healthier fast food options. The origins of the fast food death machine: The machines gears were forged by the company known