SYN 960 Business Government & Society

Albright College

Application Test #1

Read the following case below and then answer the questions following the case.

Case: A Brawl in Mickey’s Backyard

Outside City Hall in Anaheim, California—home to the theme park Disneyland—dozens

of protestors gathered in August 2007 to stage a skit. Wearing costumes to emphasize their

point, activists playing “Mickey Mouse” and the “evil queen” ordered a group of “Disney

workers” to “get out of town.” The amateur actors were there to tell the city council in a

dramatic fashion that they supported a developer’s plan to build affordable housing near

the world-famous theme park—a plan that Disney opposed.

“They want to make money, but they don’t care about the employees,” said Gabriel de

la Cruz, a banquet server at Disneyland. De la Cruz lived in a crowded one-bedroom apartment

near the park with his wife and two teenage children. “Rent is too high,” he said. “We

don’t have a choice to go some other place.”

The Walt Disney Company was one of the best-known media and entertainment companies

in the world. In Anaheim, the company operated the original Disneyland theme park,

the newer California Adventure, three hotels, and the Downtown Disney shopping district.

The California resort complex attracted 24 million visitors a year. The company as a whole

earned more than $35 billion in 2007, about $11 billion of which came from its parks and

resorts around the world, including those in California.

Walt Disney, the company’s founder, had famously spelled out the resort’s vision when

he said, “I don’t want the public to see the world they live in while they’re in Disneyland.

I want them to feel they’re in another world.”

Anaheim, located in Orange County, was a sprawling metropolis of 350,000 that had

grown rapidly with its tourism industry. In the early 1990s, the city had designated two square

miles adjacent to Disneyland as a special resort district, with all new development restricted

to serving tourist needs, and pumped millions of dollars into upgrading the area. In 2007, the

resort district—5 percent of Anaheim’s area—produced more than half its tax revenue.

Housing in Anaheim was expensive, and many of Disney’s 20,000 workers could not

afford to live there. The median home price in the community was more than $600,000,

and a one-bedroom apartment could rent for as much as $1,400 a month. Custodians at the

park earned around $23,000 a year; restaurant attendants around $14,000. Only 18 percent

of resort employees lived in Anaheim. Many of the rest commuted long distances by car

and bus to get to work.

The dispute playing out in front of City Hall had begun in 2005, when a local developer

called SunCal had arranged to buy a 26-acre site in the resort district. (The parcel was directly

across the street from land Disney considered a possible site for future expansion.)

SunCal’s plan was to build around 1,500 condominiums, with 15 percent of the units set

aside for below-market-rate rental apartments. Because the site was in the resort district,

the developer required special permission from the city council to proceed.

Affordable housing advocates quickly backed SunCal’s proposal. Some of the unions

representing Disney employees also supported the idea, as did other individuals and groups

drawn by the prospect of reducing long commutes, a contributor to the region’s air pollution.

Backers formed the Coalition to Defend and Protect Anaheim, declaring that “these

new homes would enable many . . . families to live near their places of work and thereby

reduce commuter congestion on our freeways.”

Disney, however, strenuously opposed SunCal’s plan, arguing that the land should be

used only for tourism-related development such as hotels and restaurants. “If one developer

is allowed to build residential in the resort area, others will follow,” a company

spokesperson said. “Anaheim and Orange County have to address the affordable housing

issue, but Anaheim also has to protect the resort area. It’s not an either/or.” In support of

Disney’s position, the chamber of commerce, various businesses in the resort district, and

some local government officials formed Save Our Anaheim Resort District to “protect our

Anaheim Resort District from non-tourism projects.” The group considered launching an

initiative to put the matter before the voters.

The five-person city council was split on the issue. One council member said that if

workers could not afford to live in Anaheim, “maybe they can move somewhere else . . .

where rents are cheaper.” But another disagreed, charging that Disney had shown “complete

disregard for the workers who make the resorts so successful.”

Sources: “Disneyland Balks at New Neighbors,” USA Today, April 3, 2007; “Housing Plan Turns Disney Grumpy,” The New

York Times, May 20, 2007; “In Anaheim, the Mouse Finally Roars,” Washington Post, August 6, 2007; and “Not in Mickey’s

Backyard,” Portfolio, December 2007.

1. Using Disney as the focal organization, identify all the relevant stakeholders to this case.

2. For each of the stakeholders above, clear explain their respective “interest” or claim to the situation using evidence from the case. Also, indicate if each stakeholder is in

favor of, or opposed to, SunCal’s proposed development.

3. What sources of power do each of the relevant stakeholders identified above have in this case?

4. Based on the information you have included in your stakeholder analysis/map, what do you believe is the socially responsible decision for Disney? Justify your solution by applying either the ownership theory of the firm or the stakeholder theory of the firm.

#32)     Under traditional common law, the damages awarded to his family for the                                        accidental death of the family breadwinner used to be

            a) The present value of his expected future earnings.

            b) The present value of his expected future earnings and pension benefits.

            c) Derived from the compensating differentials in pay for high-risk jobs.

            d) The present value of his expected future earnings and pension benefits, plus

                        punitive damages for the loss of a loved one.

            e) Zero.

#33)    You can tell a person is risk averse if

1. He/She buys insurance.
2. He/She sells insurance.
3. He/She doesn’t like skydiving.
4. He/She doesn’t value additional money after becoming really rich.
5. He/She likes skydiving.

#34) One problem with allowing people to keep their health records confidential from       insurance companies is

1. Moral Hazard
2. Adverse Selection
3. Risk Aversion
4. Risk Pooling
5. Risk Sharing

#35)     Post hoc ergo propter hoc (in Latin: After this, therefore because of this)

            a) Is a philosophical principle first advanced by Plato.

            b) Is a form of logical fallacy.

            c) Is contrary to the time reversibility of classical physics.

            d) Is the principle of causality used in the common law.

            e) None of the above.

The traditional business of banking comprised lending, deposit-taking and the provision of transaction services. Through the first half of the twentieth century, banking was a regulated, local, low risk business based on a customer’s credit worthiness and yielded returns based on interest.

Much has changed, but the mid-century model persists in the popular consciousness. Bank advertising draws heavily on this historical image. During the 1950s, banking had little to do with funds management, where an entity pools and invests money on behalf of customers.

The funds management sector was composed largely of superannuation and life insurance. For reasons discussed below, the reach of this sector was limited until regulatory and financial conditions changed.

In the 1970s, Australia began to deregulate its financial markets. Restrictions on bank interest rates and liability structures were removed; foreign banking was made easier to access; the Australian dollar was floated. The financial sector expanded. At the same time, growth in the size and liquidity of securities markets allowed more diverse financial products to develop.

The next critical steps were the expansion of superannuation, which shifted the responsibility for and control of provision for retirement from employers into the hands of individuals. From 1983, successive changes to the tax treatment of superannuation increased the complexity of superannuation but also established it as a vehicle for compulsory saving. These developments included the incorporation of superannuation into employment awards in 1986 and legislation in 1991 imposing tax penalties where employer contributions were not made.

With greater amounts of savings invested in superannuation funds, Australians now have a far higher exposure to capital markets and since the 1980s Australians have increasingly seen a need for financial advice.

In 2000, CBA acquired Colonial Mutual Life Assurance Ltd, which conducted life and other insurance business, and a funds management business

In 2000, NAB acquired the financial services businesses of Lend Lease, including its MLC Holdings Ltd. advice, platform and superannuation and asset management businesses.

In 2002, ANZ entered joint venture arrangements with ING Group in respect of wealth management and life insurance businesses in Australia and New Zealand, and later acquired the full business.

In 1999, Westpac founded Magnitude Group Pty Ltd. In 2008, as part of its merger with St George Bank Ltd, Westpac acquired St George’s financial advice business, which included employed advisers as well as Securitor Financial Group Ltd. In 2002, Westpac acquired all of BT Financial Group’s asset accumulation businesses.

Scandals dating back to the GFC began to shed light on the conflicts and culture in the financial advice industry.

In their submissions to the Commission, financial services entities acknowledged conduct that amounted to misconduct or conduct falling below community standards and expectations in connection with the provision of financial advice.

Clients of financial advisers or financial advice licensees being charged fees for services not provided to them is now rightly recognised to have been a large and endemic problem in the industry.

Charging for doing what you do not do is dishonest. No-one needs legal advice to tell them that.

https://financialservices.royalcommission.gov.au/Documents/interim-report/interim-report-volume-1.pdf (Links to an external site.)Links to an external site.

1. What are the core traditional functions of commercial banks? (1 mark)
2. How did banks generate profits prior to the 1980s, and what was their attitude to risk? (1 mark)
3. Identify two major changes which happened in the funds management sector of the Australian financial system between the 1970s and the 1990s. (1 mark)
4. How did Australia’s big-4 banks respond to these changes? (1 mark)
5. What is the main problem which arises as a result of providing financial advice and selling investment products in the same organisation? (1 mark)
6. Identify evidence of undesirable cultural change in the banking and financial services sector of the economy in the above extract. (1 mark)
7. Identify and distinguish between the roles played in the Australian banking system by APRA and ASIC. Which of these two institutions appears to have been more heavily criticised by the Royal Commission, and what is the main reason for this criticism?
8. What does it mean to say that the big-4 banks are ‘too big to fail’? Explain your answer clearly and concisely. (1 mark)
9. In what sense do the big-4 banks face a problem of moral hazard? (1 mark)

Please read case and answer the questions

The problem of developing engaging online content that serves the interests of readers, journalists, and advertisers alike has persisted since the explosion of the Web in the 1990s. Information may want to be free, but high quality journalism also wants to be compensated. Although modern media companies have learned valuable lessons about how to create high quality, profitable online content, the industry still has more to learn about how to create content better suited for the capabilities of the Web. One company, Vox Media, is hoping to develop answers to these problems and to other important challenges in online journalism. Founded in 2003, Vox Media is a digital media company that manages a set of editorial brands focusing on major content categories like sports (SB Nation), technology (The Verge),gaming (Polygon), and real estate (Curbed). Vox Media hopes to become a purely online version of media companies like Conde Nast, Time Inc., and Disney. Vox Media consists of over 300 sites, all of which are built on its proprietary Chorus digital publishing platform. For example, the SB Nation brand consists of hundreds of sites, most of which are focused on individual professional sports teams. Vox Media also launched a news and politics site under its flagship domain, Vox.com, in 2014.Vox.com plans to use the persistence of the Web and freedom from the space restrictions of traditional print media to cover the news more effectively and engagingly. In traditional print media, there are space constraints for every article, and each inch of column space is precious. Space online is more abundant, and the editorial compromises required to get the most information possible into a fixed space are no longer necessary. Vox hopes to avoid oversimplifying a complicated topic or omitting any details except the most pertinent.Not only that, but the Web makes it much easier to find older material or to search within archives. Most home pages emphasize only the newest developments. In print media, each day’s news is forgotten, as staff and management continually focus on the next day’s content. But on the Web, this doesn’t need to happen. Topics can build organically, and journalists can focus on new developments instead of repeatedly explaining the same concepts each day. In this way, the Web is “persistent” in a way that print media is not; the previous day’s content is still readily available, and the next day’s content can build on it, enriching coverage and reducing journalists’ workloads.Sites like Wikipedia use the persistence of the Web to great effect, as articles continue to build over time, retaining information that is still relevant while updating information that has become outdated. But very few online news outlets take advantage of the persistence of the Web. Vox envisions this type of approach to covering the news. In the past, many of the most important topics in the news have been troublesome for media companies because they’re distasteful, difficult to understand, and difficult to cover. If Vox reaches those lofty goals, it will likely be because of unique features like the card stack. Card stacks are modular topic resources that are updated to reflect the most recent developments in a particular area. For example, there are card stacks for Bitcoin, ISIS, and Obamacare, where each card discusses one specific element of the topic; for example, the Bitcoin card stack features cards such as “How do people get bitcoins?” and “Does Bitcoin have a security problem?” For complicated topics with a lot of jargon or subordinate topics that need to be frequently explained, card stacks are a perfect companion to relevant news articles.Highlighted text within these articles indicates when a card can better explain a phrase or a topic. Card stacks have some things in common with Wikipedia, including persistence and contemporariness.

1.How does James Bankoff, Chief Executive Officer and Chairman of Vox, describe Vox Media?

2.What does Bankoff say Vox Media’s approach is to digital media?

3. What does Bankoff think about the issue of trust and quality with respect to online content as it relates to Vox Media?

4.According to Bankoff, how does Vox Media intend to grow?

5.What is the difference between Vox Media and Vox (Vox.com)?

6.What does Matthew Yglesias say that he is hoping to achieve at Vox.com?

6. The following are IQ scores for some medical school students:

               120        106        121        112        114        134        140        121        168        127

Construct a 99% confidence interval for the population mean IQ score of a medical student.

7. Construct a 95% CI for σ in #6.

Review the most common causes of injury and death in children of various ages. Choose an age group (infant, toddler, preschool-aged, school-aged, adolescent), and develop a teaching plan about ways to avoid the hazards. Would you address the parent or child with your teaching plan?

• Differentiate among the professional psychology specializations (clinical, counseling, and school) in terms of philosophy, topic areas, and settings.
• Select five major events/milestones in the development of clinical psychology. Develop a chronological time line detailing the events/milestones you chose and their significance to the profession of clinical psychology.

Robert Sternberg and Howard Gardner argued that, as a society, we need to expand our measure of intelligence beyond traditional tests. Describe the way each explains intelligence. Then explain how ideas presented by Sternberg and Gardner have changed school environments. Please include two sources