Marketing Plan- Pepsi in Pakistan

Contents acknowledgement3 executive summary4 challenge5 new product category5 product line extension5 incremental improvement5 introduction to the company5 sigtuation analysis7 company analysis7 mission statement7 vision statement7 market share8 customer analysis8 customers:8 consumer decision process:9 competitors10 collaborators11 climate:12 economic effect analysis12 political effect analysis13 technological factors:14 social and cultural analysis14 swot analysis of pepsi15 strengths15 weaknesses15 opportunities16 threats16 market segmentation16 behavioral base16 congnitive base17 selected market strategy17 product17 branding:17 logo18 pepsi slogan18 product line19 packaging19 price20 prices of different bottles21 discounts21 placement/distribution channel22 indirect distribution22 direct distribution22 promotions22 conclusion23 suggestions23 bibliography24 references24 evidences24 visiting cards24 acknowledgement ? We owe our gratitude to Allah Almighty whose shower of blessings and kindness has been on us throughout the working on these pages. It is His help that we finally able to compile this document. Related article: co.uk/gardenia-marketing-plan/">Gardenia Target MarketWe are indebted to our respected teacher Miss Fiaza Rehman who’s indispensable and intricate comments on various aspects conjoined with motivation made us come forth holding such as project. EXECUTIVE SUMMARY ? Purpose of this project is to study the strategies which Pepsi is doing in Pakistani market for its product Pepsi cola. Pepsi International is a world renowned brand. It is a very well organized multinational company, which operates almost all over the world. In Pakistan It also has proved itself to be the No. 1 soft drink.Now days Pepsi is recognized as Pakistanis National drink Pepsi's greatest rival is Coca Cola. Coca Cola has an international recognized brand. Coke’s basic strength is its brand name. But Pepsi with its aggressive marketing planning and quick diversification in creating and promoting new ideas and product packaging, is successfully maintaining is No. 1 position in Pakistan. Pepsi is operating in Pakistan, through its 12 bottlers all over Pakistan. These bottlers are Pepsi's strength. Pepsi has given franchise to these bottlers.Bottlers, produce, distribute and help in promoting the brand. Pepsi also launched its fast food chain KFC i. e. â€Å"Kentucky Fried Chicken. † We also did analysis of the soft drink industry in Pakistan and worldwide. The soft drinks set to become world's leading beverage sector. Global consumption of soft drinks is rising by 5% a year. CHALLENGE Pepsi is doing new product development on frequent interval of times. The purpose of which is to refresh the brand. By new products and innovative ideas consumers can easily be attracted.In following ways Pepsi is doing new product development. New product category Pepsi which is mainly a company of soft drinks after establishing a brand in Pakistan Pepsi came into several new product category. Lays, kurkuray and aqua fina, fast food restaurants are the examples of new product category. Product line extension Mountain dew is the most recent addition in the product line of soft drinks which is very popular especially among the youngsters. However Pepsi launch its several variants with a minor difference on frequent interval of time.There have been many Pepsi variants produced over the years since 1903, including Diet Pepsi, Crystal Pepsi, Pepsi Twist, Pepsi Max, Pepsi Samba, Pepsi Blue, Pepsi Gold, Pepsi Holiday Spice, Pepsi Jazz, Pepsi X (available in Finland and Brazil), Pepsi Next (available in Japan and South Korea), Pepsi Raw, Pepsi Retro in Mexico, Pepsi One, Pepsi Ice Cucumber and Pepsi White in Japan. * Line Filling Pepsi claims that they are doing mass marketing but there was an unfilled gap in the consumers. The diabetic patient can’t use the regular Pepsi because f the sugar. So Pepsi had introduced diet Pepsi to fill the gap in their drinks as of then onwards even diabetic people became their consumers. Incremental Improvement Pepsi jumb o is an example of incremental improvement made by Pepsi. It was 2. 25 liter bottle introduced few years ago in Pakistan. The purpose of this packing is to offer the Pepsi to a family for one or two time meals. Price of this pack is also kept low so that is can be affordable easily by the consumers. INTRODUCTION TO THE COMPANY Pepsi International is a world renowned brand.It is a very well organized multinational company, which operates almost all over the world. They produce, one of best carbonated drinks in the world. Pepsi is a symbol of hygiene, quality and service, all over the world. Pepsi is producing Cola for more than 100 years and it has dominated the world market for a long time. Its head office is in New York. HISTORY OF PEPSI COLA It was first introduced as â€Å"Brad's Drink† in New Bern, North Carolina in 1898 by Caleb Bradham, who made it at his pharmacy where the drink was sold.It was later named Pepsi Cola, possibly due to the digestive enzyme pepsin and kol a nuts used in the recipe. Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy. In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore to a rented warehouse. That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was sold in six-ounce bottles, and sales increased to 19,848 gallons. In 1909, automobile race pioneer Barney Oldfield was the first celebrity to endorse Pepsi-Cola, describing it as â€Å"A bully drink†¦ efreshing, invigorating, a fine bracer before a race†. The advertising theme â€Å"Delicious and Healthful† was then used over the next two decades. In 1926, Pepsi received its first logo redesign since the original design of 1905. In the year 1929, the logo was changed again. In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered bankruptcy – in large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a r esult of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight years later, the company went bankrupt again.Pepsi's assets were then purchased by Charles Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained soda fountains. He sought to replace Coca-Cola at his stores' fountains after Coke refused to give him a discount on syrup. Guth then had Loft's chemists reformulate the Pepsi-Cola syrup formula. During the Great Depression, Pepsi gained popularity following the introduction in 1936 of a 12-ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was slashed to five cents, sales increased substantially.With a radio advertising campaign featuring the jingle â€Å"Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you,† arranged in such a way that the jingle never ends. Pepsi encouraged price-watching consum ers to switch, obliquely referring to the Coca-Cola standard of six ounces per bottle for the price of five cents (a nickel), instead of the 12 ounces Pepsi sold at the same price. Coming at a time of economic crisis, the campaign succeeded in boosting Pepsi's status. In 1937 500,000,000 bottles of Pepsi were consumed.From 1936 to 1938, Pepsi-Cola's profits doubled. Pepsi's success under Guth came while the Loft Candy business was faltering. Since he had initially used Loft's finances and facilities to establish the new Pepsi success, the near-bankrupt Loft Company sued Guth for possession of the Pepsi-Cola company. A long legal battle, Guth v. Loft, then ensued, with the case reaching the Delaware Supreme Court and ultimately ending in a loss for Guth. PEPSI COLA PAKISTAN The market in Pakistan is surely dominated by Pepsi. It has proven itself to be the No. 1 soft drink in Pakistan. Now days Pepsi is recognized as Pakistanis National drink.In 1971, first plant of Pepsi was constru cted in Multan, and from there after Pepsi is going higher and higher. Pepsi is the choice soft drink of every one. It is consumed by all age groups because of its distinctive taste. Compared with other Cola in the market, it is a bit sweeter and it contributes greatly to its liking by all. Consumer’s survey results explain the same outcome and Pepsi has been declared as the most wanted soft drink of Pakistan. SITUATION ANALYSIS COMPANY ANALYSIS MISSION STATEMENT â€Å"To be the world's premier consumer Products Company focused on convenient foods and beverages.We seek to produce healthy financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity. † VISION STATEMENT â€Å"To be the world's best beverage company†. Being the best means providing outstanding quality, service, cleanliness and value, so that their every customer is contented and happy with their products. † â€Å"To increase the value of their shareholder’s investment through sales growth, cost control and wise investment of resources. † MARKET SHAREWhen Pepsi was introduced in Pakistan, it faced fierce competition with 7up, lemon and lime drinks, which was established during 1968, in Multan. Pepsi introduced its lemon and lime, â€Å"Teem† to compete with 7up. It successfully, after some years, took over 7up, and this enhanced Pepsi's profits and market share. In Pakistan, Pepsi with 7up enjoys 70% of the market share where as the coke just has 20% markets share. Pepsi is operating in Pakistan, through its 12 bottlers all over Pakistan. These bottlers are Pepsi's strength. Pepsi has given franchise to these bottlers. Bottlers, produce, distribute and help in promoting the brand.Pepsi also launched its fast food chain KFC i. e. â€Å"Kentucky Fried Chicken. † CUSTOMER AN ALYSIS CUSTOMERS: There are three types of customers 1. Consumer 2. Business 3. Government Pepsi main focus is the consumers which are the end users. Pepsi has to make its marketing strategies keeping in view the consumer buying behavior. To forecast the behavior of the consumer is a business problem. Physical aspect of the consumer can be satisfied but it is difficult to satisfy the consumer psychologically. Consumer buying behavior is affected by certain factors like Cultural factors, Social factors, Personal factors and Psychological factors.So the producer should keep these factors in Mind while promoting their product so that they can acquire the customer and increase their market share. There are different consumers in a society whose behavior is not the same. Every consumer has a different perception of different products. Some consumers are impressed by one quality of the product which may be in the view of other consumer not that impressive. So to deal with different consum ers in a society one should know about the consumer buying behavior process which may help in making a true picture of their product in the mind of the consumers.About 75 million cases a year for Pepsi alone; the total beverage market is about 120 million cases of which 65% per cent are Pepsi products; about 20 to 22 per cent are Coca-Cola products and Zum Zum cola and Mecca Cola, Amrit Cola and Muslim Cola†¦ there are so many colas; there is RC and Double Cola which are franchised products. Altogether they have around 5 per cent of the market. Due to the Afghan and Iraq wars, they did get a little footing especially in the frontier and Islamabad area but still they are not hugely popular * ? Total annual sale of soft drink in Pakistan 120 million cases * ?Pepsi annual sales in Pakistan 75 million * ? Market share of Pepsi 65% * ? Consumption growth 1. 7 % per year CONSUMER DECISION PROCESS: Consumer decision process or consumer buying behavior is explained in some steps which are discussed below: * Need Identification The consumer is thirsty and he wants to quench his thirst. * Information Search He will search as to what will satisfy his thirst the most. * Evaluation of Alternatives He will now evaluate from the wide range of beverages available to him that which one of them is suitable to him in terms of quality, taste and is pocket friendly. Selection After evaluating the product he will select a product. * Purchase The consumer will buy the selected product. * Post-Purchase Experience: It is the experience that the consumer gets after using the product. He will use the product again if he feels that his satisfaction after use is more or equal to the price of the product. After looking at above mentioned example, we can get an understanding that a product should be so desirable that whenever a person identifies his need, he selects our product among various substitute products and he feel satisfies so that he retains the use of that product.COMPETITOR S Company who directly target your customers. The marketing concept states that to be successful, a company must provide greater customer value and satisfaction than its competitors do. Pepsi has a tough competition with Coca Cola while it faces a little competition with the local producers like RC Cola, Shandi Cola etc. The local producers hardly affect the sales of Pepsi in the market. There are different types of competitor in the market. Some of them in which our product lies are discussed below: ? Close Competitor Pepsi and Coke are close competitors.It means that both have direct competition in the market, their products are close substitutes for one another. Both the products can influence the market share of one another through effective strategies made to cope up with their competitors. * Distant competitors Pepsi cola and Nestle juice are distant competitors of one another. It means that their products satisfy the same want but they are in indirect competition with one ano ther. * Strong Vs Weak: Coca Cola and Pepsi are strong competitors. In Pakistan Pepsi is the market leader and Coca Cola is its competitor.The Pepsi makes defense strategies so that it can maintain its position in the market. While Coca Cola is a challenger and it makes attack strategies so that it can become the market leader. Pepsi and Shandi Cola are weak competitors. Pepsi is the market leader and Shandi Cola is the follower. Pepsi is not in direct competition with the Shandi Cola. It means that Shandi Cola has little effect on the sales of Pepsi. COLLABORATORS Pepsi Cola International has given franchises all over Pakistan. These companies have installed their plants in different parts of Pakistan with these specified areas and names e. g.City| Name of Franchise| Karachi| Pakistan Bottlers| Lahore| Riaz Bottlers| Faisalabad| Punjab Beverage | Multan| Shamim ; company| Pepsi Cola provides consumers place utility which is, where ever and whenever you want it, you get it! Pepsiâ⠂¬â„¢s channel of distribution is very aggressive according to the consumers, manufacturers and distributors. Pepsi has 12 different units in different areas of Pakistan, which make the Pepsi easily available all over the country. The cities in which the Pepsi units are: * Lahore * Sukkur * Karachi * Multan * Dera Ghazi Khan * Islamabad * Faisalabad * Quetta * Hyderabad * Sahiwal * HattarPepsi is an international brand so it also has other units in other countries of the world like America, Europe, Afghanistan, Middle East and Central Asia. The big advantage for Pepsi in Pakistan is that it distributes the product through bottlers. So bottlers’ effort also contributes in the promotion of Pepsi. CLIMATE: ECONOMIC EFFECT ANALYSIS * Income and Income per Capita If the income level or per capita income of the people increases, it will have a positive effect on the consumption of Pepsi. * Inflation If the country faces inflationary trend in the market, the price of the Pepsi will ultimately increase which will lower its demand. Consumption Behavior Pakistan is a consumption oriented society. Due to demonstration effect the people are more inclined towards consumption than saving. So the people of Pakistan spent heavily on food items. Hence Pepsi has a good market share in the present circumstances. * Income Distribution It means how much is in the hands of rich and poor class. In Pakistan 10% rich people posses 93% of wealth and 90% people posses 7% of wealth. If there is balanced distribution of income in the country, the consumption of the people will increase hence increasing the sales of beverages as well. * Payment ModAs the use of plastic money is increasing the consumption pattern of the people are increasing. Although it will have a low affect on the consumption of Pepsi. * Employment Opportunities As employment opportunities increase the living standard of the people increase and the people consume more. * Aggregate Demand In case of Pepsi, aggregat e demand of the product increases in the season of summer as the hot weather makes the consumers want to drink more. * Aggregate Supply In summer season to cope up with the increasing demand they have to increase the aggregate supply of their product. * Economic PoliciesSome of the economic policies which can affect the market of Pepsi are discussed below: * Fiscal Policy It is the policy of taxes. If heavy tax is levied on Pepsi then its price will rise having negative effect on its consumption. * Monetary Policy Monetary policy is made to restrict or increase the supply of money in the market. If policies are made to restrict the flow of money in the market, inflation can be controlled hence increasing the real income of the people which will ultimately affect the consumption of Pepsi. * Price Policy If price of Pepsi is increased its demand will decrease and vice versa. Income Policy If income of the people will increase their purchasing power will increase and hence increasing t he market share of Pepsi. POLITICAL EFFECT ANALYSIS * Political Stability: Whenever the government is considered to be stable, the business will flourish. If there is political stability in the country the policies and strategies made by Pepsi can be consistent to be implemented. Foreign companies are also keen to invest in those countries which are politically stable where they have no fear of decline in their market share or shut down due to sudden change of government. Mixed Economy In mixed economy government and private sector both plays their role in developing the economy of the country. Investment by foreign companies like Pepsi is more likely to flourish in mixed economy.? * Laws Formulation Government has given copy rights to Pepsi so that another company cannot sell their product by the name of Pepsi. The countries where laws are formulated, the strategies and activities of the company are different. TECHNOLOGICAL FACTORS: * Research and DevelopmentThrough research and de velopment quality of the product can be improved or better techniques or machinery can be developed which can increase the production. When technology is advance the supply of the product increase hence the company experiences growth in their business. SOCIAL AND CULTURAL ANALYSIS * Psychographic It is a combination of demographic and psychological factors. Psychological attributes mean how you perceive things. The company will focus on the behavior of consumers and make different changes in their product quantity or quality and in promoting their product so that they can attract the customers.Keeping in view that the behavior of different consumers is not alike they have to make their marketing strategies in accordance with their requirements so that they are convinced to buy the product. * Religious Religious factors can influence the market sales of Pepsi as it happened in 2003 when the U. S-led attack on Iraq, wide sections of society in Pakistan have banned American multination als Coke and Pepsi * Social Status Pepsi is a well renowned brand. People who are brand conscious will not drink beverages of lesser known brands such as Amrat cola.They will try to show their status by drinking Pepsi which is known to all as a quality drink. * Media It is a very important factor for marketing. Media these days is a very effective way of inspiring people to buy a specific product. A good promotion can boast up sales to a great extent. SWOT ANALYSIS OF PEPSI SWOT Analysis, which is based on thorough review of the business (corporation, product category competition, customers and products), identities and evaluates the internal strengths and weakness of the companies well as its external threats and opportunities.The marketing mix is driven by the results of the SWOT analysis. STRENGTHS * Demand of Pepsi is more than its competitors. * Company has a very established name and a good reputation. * Pepsi has large market share than its competitors. * As the target custom ers of Pepsi is young generation, so Pepsi has more brand loyal customers. * Most of the customers are satisfied with the price of the Pepsi. * Pepsi is an international company and it has a very strong position internationally. * The environment of factory is very good and attractive. * Pepsi spends a lot of budget on its advertising. Pepsi has a very vast distribution channel and it is easily available everywhere. * Employees are also motivated. * Pepsi offers many discount schemes for customers time to time. * Pepsi Cola is sponsoring sports, musical concerts, walks. * The location of the Pepsi plant is utilized that all major markets of Lahore are within the reach of the Pepsi plant within 30-45 minutes. WEAKNESSES * Pepsi does not offer any sort of incentive or discount to its retailers. * Pepsi target only young customers in their promotions. * Crown of the disposable bottle is not good. * Demand of disposal bottle is declining. Pepsi tin pack is not available in far off rural areas. * Pepsi is not considering many potential outlets like hotels, college canteens etc. OPPORTUNITIES * Company may start entering rural areas also. * The company may also diversify its business in some other potential business. * Increased interest of people in musical groups, cultural shows and sports has provided an opportunity for Pepsi to increase its sales through them. THREATS * The main competitor of the company is the Coca Cola. * At the international level, Pepsi has a very strong competition with Coke.Coke has started its advertisements more effectively to increase their demand and it is a very strong threat for Pepsi. * Cola drinks are not good for the health so the awareness level of the people is increasing which is a big threat to the company. MARKET SEGMENTATION It means that you divide the target market in to different groups. Market consists of buyers and buyers differ in one or more ways. They may differ in wants, resources, locations and buying practices. Th rough market segmentation companies divide large, heterogeneous markets into smaller segments that can be reached more efficiently and effectively with products nd services that match their unique needs. Segmentation is done on basis of the previously mentioned external factors and the following: BEHAVIORAL BASE It is how people perceive a specific product, in short psychological analysis of a product. Pepsi all over the world is recognized as a quality drink and therefore people drink it without any hesitation whenever they are thirsty or otherwise. So marketers of Pepsi have made it a drink for all people and for diabetic people they introduced diet Pepsi. CONGNITIVE BASE It pushes and pulls the consumer.If the outlook of Pepsi bottle is desirable and it attracts the consumer, he will buy it even if he isn’t thirsty. SELECTED MARKET STRATEGY PRODUCT The soft drinks market in Pakistan enjoys dynamic growth in both volume and value terms. Carbonated drinks have become part of the culture in Pakistan and multinational companies have maintained standards over the years to provide the nation with high-quality drinks. Rural areas of Pakistan have driven sales of carbonated drinks to new heights as more than 60 percent of the population resides in rural areas and young consumers are more attracted to advertising.Pepsi is the most popular and leader brand in the Pakistani market and is consumed by children and adults alike. Pepsi is a responsible corporate brand of Pakistan and have contributed a lot to the economy. In marketing, a product is anything that can be offered to a market that might satisfy a want or need. Until unless the product of the company is not strong in the market it cannot survive in the longer run. Pepsi has a product line comprised up of carbohydrate drinks, Lays and many other products in Pakistan.Pepsi’s product line satisfies consumer needs because Pepsi produces different types of soft drinks for different consumers. The most popular product of Pepsi is Pepsi Cola. Due to its good taste Pepsi is a well-known product. Thus Pepsi Cola satisfies the consumer’s needs efficiently by launching a desired product. BRANDING: Consumer view a brand name as an important part of the product and branding can add value to the product. A name, term, sign, symbol or design or a combination of these intended to identify the goods and services of one eller or group of seller and to differentiate them from their competitors. LOGO Logo is what establishes a brand name in the consumer mind. It is the brands identify, signature, image and more often it is a logo that makes of breaks a product logo plays a very effective role to improve the product or brand. Pepsi kept on changing its logo from time to time along with the trade marks. Evolution of Pepsi logo ? PEPSI SLOGAN 1909-1939:  Ã‚  Ã‚   | Delicious and Healthful | 1939-1950: | Twice As Much For A Nickel Too | 1950-1963: | The Light Refreshment | 1953-1961: | Be Sociable | 961-1963: | Now It's Pepsi For Those Who Think Young | 1963-1967: | Come Alive! You're In The Pepsi Generation | 1967-1969: | Taste That Beats The Others Cold | 1969-1973: | You've Got A Lot To Live, Pepsi's Got A Lot To Give | 1973-1975: | Join The Pepsi People Feelin' Free | 1975-1978: | Have A Pepsi Day | 1978-1981: | Catch That Pepsi Spirit | 1981-1982: | Pepsi's Got Your Taste For Life! | 1983-1983: | Pepsi Now! | 1984-now : | Pepsi, The Choice Of A New Generation | 2000 : The choice of a new generation. 2003 : Zinda Dilon Ki Pehchan. 006 : Generation next. PRODUCT LINE SODA| WATER| CHIPS| JUICES| Pepsi cola| Aquafina| Lays | Tropicana | Teem | | Kurkure | | Mirinda | | | | 7up| | | | Dew | | | | Pepsi twist| | | | PACKAGING â€Å"Packaging is a part of product planning in which a firm researchers, designs, and produces its packaging. † The physical container may be a cardboard, metal, plastic or wooden box; a cellophane, wax paper, or cloth wrapper; a glass, aluminum, or plastic jar or can; a paper bag; styro foam; some other material; or a combination of these products frequently have more than one physical container.But packaging depends upon the product nature as well as structure means either it is liquid, semi liquid or solid. In case of Pepsi Cola, they take the packaging designs by considering what is better for company and what is better or convenient for the transportation. For protecting the syrup, Pepsi Cola uses the glass as well as plastic bottles of different quantity. The variants that are offered by Pepsi in terms of size and quantity, 1. 175 ml Mini Bottle(not available now) 2. 250 ml Regular Bottle 3. 300 ml Tin 4. 1000 ml Regular Liter Bottle 5. 1500 ml Disposable BottlePRICE The amounts of money charged for a product or service, or sum of the values that consumers exchange for the benefits of having or using the product or services. As price gives us the profit so this P is very important for business price of produ ct should be that which gives maximum benefit to the company and which gives maximum satisfaction to the customer. Following factors Pepsi kept in mind while determining the pricing strategy. * Price should be set according to the product demand of public. * Price should be that which gives the company maximum revenue. Price should not be too low or too high than the price competitor is charging from their customers otherwise nobody will buy your product. * Price must be keeping the view of your target market. The price of Pepsi Cola, despite being market leader is the same as that of its competitor Coca cola. Sometimes, Pepsi places its customers into some psychological pricing strategies by reducing a high priced bottle and consumers think that they save a lot of money from this. PRICES OF DIFFERENT BOTTLES Regular bottle e= rupees 12 Non Returnable/disposable= rupees 17 Liter Bottle=rupees 30 . 5 Liter Bottle= rupees 60 2. 25 Liter Bottle= rupees 70 DISCOUNTS Pepsi Cola offers va rious discounts to those retailers who have the maximum sales of Pepsi products on daily, monthly and on seasonal basis. Some of the main discounts given to the retailers are as follows: Quality Discount Following are discounts offered by Pepsi. 1/10 Discount I. e. one case of Pepsi is free on buying 10 cases of Pepsi at one time. 2/20 Discount I. e. two cases of Pepsi are free on buying 20 cases of Pepsi at one time. Seasonal Discount Following are discounts offered by Pepsi.Pepsi also offers seasonal discounts schemes by reducing price in Ramadan and on Eid. Pepsi also offers trade in allowance for retailers. PLACEMENT/DISTRIBUTION CHANNEL The Pepsi uses the following two channels for the distribution of their products. INDIRECT DISTRIBUTION Indirect distribution involves agency holders e. g. Riaz Bottlers Pvt. Ltd. Lahore franchise has divided its region i. e. Lahore and Kasur districts in two categories. Local Zone These are 62 agencies distributing Pepsi Products (250ml Sd) onl y around Lahore in their respective allocated sub zones. Out Station Zone 7 dealers have been appointed by the bottlers for far distant places and in out skirts of Lahore and Kasur the dealers involved in direct distribution are only authorized to sell 250 ml (STD) bottle of Pepsi, Team and Marinda. DIRECT DISTRIBUTION The factory vehicles operate on 45 direct routes in Lahore selling non-returnable bottles Litter, Pet and Can. PROMOTIONS In Pakistan Pepsi is the most liked soft drink especially by young generation so the Pepsi cola company has devised such marketing strategy which attracted them. For this reason they started monitoring the habits of the generation.What they saw was that the students were crazy about cricket and usually liked to idealize them so in order to increase their sales the Pepsi cola company paid high amounts of money to the cricketers to act as their spokes men. Some of the most famous cricketers in the modern era have acted as spoke persons also film star s have been acting as spoke persons. The Pepsi cola company has after doing research also has introduced different size of bottles offered at lower prices so that everyone can afford them. Also Pepsi Company has introduced other soft drinks including mountain dew, seven up and marinda.Pepsi company has introduced other flavors such as Pepsi twist, Pepsi max diet Pepsi. Pepsi Cola Company has also become official sponsors of Pakistan cricket and has sponsored a number of series. Also Pepsi has donated a lot to the earth quake victims and has launched a number of prize schemes to attract new customers As a result of this marketing strategy Pepsi has become the largest seller of soft drinks in Pakistan and is slowly forming a monopoly in drinks market. Although many soft drinks like Pepsi have been introduced such as Amrit Cola, Quibla Cola offered at lower prices but none of these drinks have been able replace it.Frequency of the Pepsi ads varies from time to time. When the season is on Pepsi do heavy advertisement especially in ramzan days or eid occasions but this advertisement not remain consist. We can hardly see the ads of Pepsi now as there is winter season. CONCLUSION Pepsi is a well renowned company and it has maintained its position well by understanding the client psychology, by ensuring quality, by introducing ingenuity in products, by enlarging its product base, by keeping economic factors in view and by intense and jazzy advertisements.Whenever and where ever there is a spotlight event, Pepsi must figure in, like the one day international cricket matches between India and Pakistan many other such occasions. The key word for success in the Marketing World is to â€Å"remain in the spotlight† and that is what Pepsi is doing. SUGGESTIONS The marketing world is full of surprises. Who could imagine that Coca Cola would be overtaken by Pepsi? If Coke could be overrun by Pepsi, it would be no wonder that Pepsi might be overtaken by some other bevera ge. The need then is to combine quality with ingenuity.Along with that, the reputation of the company has to be kept robust. Today we live in a fast moving world where novelty and newness count a lot. One cannot rest on one’s laurels. Fresh efforts, newness of approach must remain the cardinal principles of a well orchestrated marketing strategy and the campaign must be relentless. A continuous bombardment in advertisement would convince the clients that Pepsi is a part of their lives. In order to live with style, Pepsi ought to be an essential ingredient of one’s life.The Pepsi is at its maturity stage and the sales of company are not growing very rapidly. Company is doing a lot of promotional activities to let the product remain in the market. It holds a large share of the market and whenever the sales state declining, the company can improve it by different promotional activities. Marketers of Pepsi can try to improve sales by improving one or more marketing mix ele ments. They can cut prices to attract new users and competitor’s customers. They can also launch a better advertising campaign or use aggressive sales promotion to improve the sales.Thus, Pepsi is at its maturity stage. BIBLIOGRAPHY The following are the reference material where the information is collected. i) Company websitewww. pepsico. com ii) Project Outline REFERENCES The person from whom the information is collected. i) NameTousif-ur-Rahman Khan ii) Designation/PositionBusiness Unit Manager iii) Cell No. 0302-8465226 iv) Email Addresstousif. [email protected] com. pk EVIDENCES VISITING CARDS The visiting cards of the persons relevant to marketing department are attached herewith.

Macbeth’s inner turmoil

Machete's inner turmoil, highlighting his uncertainties, regarding the act of regicide, are prevalent throughout the play. The character who once was seen as a noble man to the king eventually becomes his murderer. Machete's inner turmoil is revealed in scene four for the first time when he soliloquies, â€Å"†¦ The eye wink at the hand; yet let that be which the eye fears when it is done, to see. † Macbeth at this point is already contemplating the act of regicide.Act one scene seven Is perhaps the most Important scene highlighting Machete's Inner turmoil before he commits the unthinkable crime of regicide. The soliloquy accentuates his unwillingness to perform the crime. However it also reflects Machete's power hungry motives and overly ambitious personality. This soliloquy proves his inner turmoil about the fact that,† if the assassination could trammel up the consequences and catch, with his surcease, success; that but this blow might be the be-all and the end-a ll†¦ Ere, but here upon this bank and shoal of time, we'd Jump to the life to come. † Proving his fear of consequence not only In this life but In the life hereafter. His fear of murdering the king while he possesses his â€Å"double trust† reinforces the rower struggle between good and evil within Macbeth. The Idea of upsetting the whole of Scotland also frightens Macbeth and the fact that Duncan Is a virtuous well-liked King would make the crime seem even more horrendous.The fact that Macbeth admits ambition, which overlaps itself and falls on other's† reinforces the idea that although he is contemplating the act of regicide he is fully aware of the consequences he will have to bear. The â€Å"dagger of the mind† Is a clear Indication and foreshadow of the guilt he Is experiencing by simply fantasizing about killing the king and the guilt he will experience after he has committed the crime. Macbeth decision that he â€Å"will proceed no further in t his business† indicated his virtuous morals.Macbeth after the murder, Is scared at even the slightest sound this reinforces his guilty conscious and his utter regret â€Å"this sorry sight. † He also confesses his incapability of saying,† ‘Amen' when they did say ‘God bless us. ‘† as he has now realized that he has completely handed himself over the evil. Macbeth proves to be both a good virtuous man and a cold blooded murderer, tragic hero over the brink of no return.

Do Colleges Use PSAT Scores?

Most generally, the PSAT/NMSQT (literally Preliminary Scholastic Aptitude Test / National Merit Scholarship Qualifying Test) serves as practice for the SAT. This test is usually taken in the first semester of 11th grade, while the newer versions, which include PSAT 10 and PSAT 8/9 , are taken in 10th and 8th or 9th grades respectively. Since you probably won’t be taking the SAT before your junior year, the latter tests serve as measures for what you’re learning and indicate whether you’re on track for college. Colleges usually don’t see your PSAT scores. In most cases, just you and your high school are able to see the report. These reports offer details on your performance in different areas and can help you determine which areas you need to improve and hone your practicing. Your PSAT/NMSQT scores may enter you in the National Merit Scholarship Program if you take the test as an 11th grader. Your scores may also be used as qualifiers for other scholarships. So while college probably won’t see your PSAT scores, that doesn’t mean they don’t matter. The earlier you take the PSAT, the more likely your score will change when you take the SAT. That’s one reason why it’s not the most solid indicator of your SAT performance, though it can show you where you should focus your practice efforts. When you receive your report, you’ll see college readiness benchmarks that indicate how prepared you are for a college curriculum. Still, remember that you have more than a year and a half of high school education, so there’s plenty of time to improve. Check out Are PSAT Scores Related to SAT Scores? for more information on how your results on the tests correlate. You raw scores, or total number questions you answered correctly, are converted to a score on a scale of 160–760 for each section, for a total of 320–1520. The tests themselves mirror the SAT and include Reading, Writing and Language, and Math. You will also see subscores for specific skill sets and percentiles that indicate how you did relative to others taking the same test. For instance, if you scored in the 80th percentile, you scored better than 80 percent of test takers. Whatever your personal goals and objectives are for the PSAT, you should definitely aim to exceed the College Readiness Benchmarks. The good news is that if you don’t, you have time to improve for the SAT. Each skill will be color-coded according to when you’ve reached the benchmark. Green means you’ve met or exceed it in that area, yellow means you’re approaching the benchmark, and red means you need to strengthen your skills in the area. With our free SAT guide, you'll get ’s top tips for mastering the SAT. Enter your name and email below to download the checklist. As we’ve discussed, colleges don’t typically pay attention to PSAT results. In most cases, they won’t even see your results. However, you shouldn’t blow off the test. It can help you a lot in preparing for the SAT and understanding your college readiness and where you need to improve. If you take the PSAT seriously and prepare for it as though you were taking the SAT, you may have a less stressful admissions and financial aid process. Doing well can also boost your confidence, since scoring well can alleviate fears that you might not do well on the SAT, and the practice can help you cope with test anxiety before the tests colleges will see. Think of it as a rehearsal for the real test. Your PSAT scores can also help you win scholarships. The National Merit Scholarship Corporation cosponsors the test and will automatically receive your results. (Check out How to Qualify for the National Merit Scholarship Program for information on the award.) Some other scholarship committees, including National Hispanic Recognition Program, the National Scholarship Service, and Telluride Seminar Scholarships, use these results, too, although you may elect to not have them sent. Ultimately, you shouldn’t underestimate the importance of the PSAT. It can help you a lot with practicing, studying, preparation and, ultimately, getting into college. Looking for some help with acing the SAT? The SAT Tutoring Program will help you achieve top scores on your test. We’ll pair you with two private tutors, one for English and writing, and one for math and science. All of our tutors have scored in the 99th percentile on the section they are teaching and are chosen based on teaching skills and ability to relate to their students.

Pick an international event (from any time period) and apply either Research Paper

Pick an international event (from any time period) and apply either the systemic or domestic level of analysis to that event. In - Research Paper Example The paper aims at providing an intensive review of the historical validity and impacts of the WWI on United States history. Discussion The First World War occurred between 1914 and 1919 and was an intensively bloody war with massive life losses and minimal ground lost. Mainly fighters in trenches fought the war, and it led to approximated ten million or more militants dead and approximately 21 million more wounded. While various nations hoped that the war would be crucial to put a stop to all other wars, in the real sense, the culminating peace agreement set the pace for the Second World War (Dutton 98). The First World War destroyed various empires and weakened others. For instance, the Russian Revolution of 1917 following the regime of Czarist collapse, which ended in the seizure of the authority by Bolsheviks. With the overthrow of the military group in 1918, the Austro-Hungarian and Ottoman kingdoms declined, whereas Germany substituted the administration of Kaiser with the natio n of Weimar. New nation states including Poland, Yugoslavia and Czechoslovakia emerged from formers empires (Protess, Callaway and Vernon 234). Consequently, victory for the allies of the Europe nations came at an increased price. They owed more than $12 billion to the U.S, which was endorsed from a former net defaulter to a higher status (net creditor). In addition, New York City substituted London as the international economic headquarter. Additionally, the European allies experienced high demands for self-rule mainly from their colonies. Similarly, European allies lost control over sufficient economic and military resources to shape global affairs as before. Near the culmination of the WW1, Japan and USA joined the leading nations at the 1919 Unity charter, in Paris, together with other nations such as France, UK and Italy, with the president of the USA, Woodrow Wilson taking a central role. The president formed the League of Nations a fundamental part of the Versailles Treaty wi th Germany (Gracia 104). The U.S and the allies, failed to acknowledge the government of Bolsheviks in Russia, and consequently, exempted the Soviet Union from Paris. In addition, Wilson strived for maintenance of unity and cooperation that would preserve industrialist and democratic countries. Reinforcing the principle of self-determination at national level, Wilson summoned the post war (aftermath) league of nations to offer a collective security to all its members. Further, he expected the national league, under the leadership of Americans, to protect the political independence and territorial integrity of its members, against external hostility, and, therefore, preserve the peace (Keene 248). Americans reacted against Woodrow Wilson’s firm wartime leadership, for instance, the elections in 1918 reduced Democrats to the inferior (minority) in congress. Moreover, after the crisis, with the removal of policies and rules by wartime organizations, the U.S suffered intensive ec onomic upturn, inflation, and labor go-slows. The Expeditionary Forces of America returned from France and rapidly demoralized. In addition, the Congress, with the 1920 National Defense Act, reduced the American army to almost its pre-war level. Rapid disbursement and restructuring led to social strife in the U.S in early 1918 and 1921. Irrespective of the wartime loyalty, numerous Americans such as black American were mainly the critical victims of

Comparison of Wesley and Whitfield on grace and predestination Essay

Comparison of Wesley and Whitfield on grace and predestination - Essay Example 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‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.13 V. Bibliography†¦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‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦14 I. Introduction Three prominent religious members lay behind the evangelical movement that arose in English Christianity within the 1730s when Charles, John, and Wesley came together as Methodists. George Whitefield was a Calvinist while John Wesley and his brother Charles Wesley can be considered as Arminians. The reasons for Whitefield’s dedicated attitude can partly be linked to his close friendships with American evangelicals, which led into deeper comprehension of Puritan theology and its significance to evangelism and revivals. The pa per explores the views of Wesley and Whitefield on the theology of grace and predestination. II. Background Prior to his departure, Whitefield’s sermon dwelling on â€Å"On the Nature and Necessity of Our Regeneration or New Birth in Christ Jesus† based on 2 Corinthians 5: 17 â€Å"if any man be in Christ he is a new creature.† In his sermon of 1737, â€Å"the doctrine of our generation, new birth in Christ Jesus† can be regarded as one of the most fundamental. ... agreed wholly with the Wesley that â€Å"nothing but a guarantee that people are born again that all are members of Christ united to Him by one and to the Holy Spirit that He was actuated† can fulfill the heart of man.2 The three also concurred on the nature and degree of the sanctification started through the work of the Holy Spirit within regeneration. When George Whitefield left England in 1739, he was appreciated as a leader of the evangelical awakening. Whitefield handed over his followers to John Wesley’s; nevertheless, when he returned in 1741, Whitefield found that a majority of his spiritual children were hostile to the extent that they sent threatening messages to him that God will speedily destroy him. This emanated from by the fact that, on Whitefield’s departure, Wesley had published a sermon titled â€Å"Free Grace,† which professed to be founded upon, Roman 8:32. John Wesley’s sermon, published in August 1739 and attempted to demonstr ate how God’s Grace is â€Å"free in all and free for all.† Wesley’s message was a robust critique of the doctrine of predestination and election. Wesley believed such a doctrine was a precarious one and that it blasphemed the very person and nature of God. Election represents God’s choosing whom to save and it is unconditional, given that there is no condition man must satisfy before God chooses to save him. Calvinists concur that humankind must meet the condition of faith in Christ so as to inherit eternal life; however, faith is not a condition for election, but rather election is a condition of faith. Whitefield and Wesley could not find a common ground, which split the movement between the adherents of Wesley and those of Whitefield.3 The division arose from the fact that Whitefield and Wesley did not share the

Literacy Essay Example | Topics and Well Written Essays - 500 words - 3

Literacy - Essay Example e along a variety that includes of reading, writing and skill in both digital and print environments together with the critical understanding and decision-making abilities they need in their lives. Nonetheless, a culture creates a definition of this aspect, literacy is connected to most of the attributes in individuals’ and community life and remains an important basis for learning through life and should always be considered as a human right. Literacy involves an long-term and academic procedure of achieving meaning as a result of critical understanding of text or written text. The main characteristic of all literacy is the development of reading, which is a development of skills that start with the ability to understand spoken words and interpret written words that ends in a better understanding of the text. The development of reading abilities involves a variety of complicated language foundations such as being aware of speech sounds, patterns of spelling, meaning of words, grammar as well as the patterns used in forming words to provide a necessary stand that leads to ease in reading and ability to understand text. When these skills are acquired, the person who is reading can achieve full language literary that includes the capacity to critically explore printed material, conclude and create, write accurately and reasonably, and use the information and understanding from the text as the basis for informed choices and creative thoughts. An inability to achieve all this aspects is referred to as illiteracy. The English language has gone through a lot of significant changes throughout history and in the previous decade alone, the level of literacy of students has increased past the traditional characteristics such as reading, ability to understand, grammar and writing to encompass applications that are more digital and interactive. With the present learners experiencing numerous traditional and digital literacies, parents are left with the question of how they

Water conservation strategies according to green seal requirements Case Study

Water conservation strategies according to green seal requirements - Case Study Example This paper deals with the concept of water recycling and waste water management according to the principles enshrined in Green Seal recommended practices. Water recycling processes can adopt many strategies that strives to conserve water as well as reuse them after separating harmful pollutants and organic matter from it. The strategies also involve practices that encourage the effective use of water and reduction of waste water. Waste water management is not a discipline that merely consists of scientific jargon. It is attainable and sustainable provided one takes the pains to implement it aptly.With the increasing destruction of environmental resources, the need for conservation has significantly increased in the modern world. This is specifically so in the case of resources such as water. Statistics available indicate that sources of potable water will not remain as such if the level of exploitation is to continue at the current rate in the world. In addition to the pressures of p opulation increase and pollution, industrial pressures on potable water are also decreasing the availability of fresh water and there is an urgent need to control water wastage. It is in this context that the need to control water wastage through water recycling gains importance. Wastewater management is an emerging field of science that helps to tackle issues related to water pollution and contamination in the industrial world.The need for waste water management has many ramifications, which is both social as well as economical. As far as the society is concerned waste water management helps to recycle the much needed elixir of life back into the water sources as potable water. Otherwise, water that is recycled can be used to sustain green cover over an area thereby providing for the optimum use of this precious natural resource. On the economic front it may be said that conserving water amounts to saving money in many ways and the initial costs that may be involved can soon be rec ouped in terms of both tangible and intangible benefits for the company. World wide statistics indicate that water, which is a fundamental need for the existence of life on earth, is limited in terms of its availability. Humans have access to less than 0.08% of all the water that is available in earth. To add to the woes it is believed the need for water will increase by about 40% in the next two decades. This perhaps indicates to the immense responsibility that humans have towards conserving water. In the year 1999, the United Nations Environment Programme identified water shortage as one of the two most worrying problems for the millennium. The fact that the other problem, global warming, is also related to water shortage adds gravity to the situation. It is believed that one person in five across the world has no access to safe drinking water. Similarly, one in two lacks safe sanitation [United Nations Industrial Development Organization. 1996] In terms of social ramifications, a reliable supply of water is the basic need for any form of development. The availability and quality of water is essential factor in the nation's ability to protect public health, preserve ecological integrity, ensure sufficient agricultural production, and meet commercial needs. Therefore issues affecting the nation's atmospheric water, surface water and groundwater need to be addressed with priority. Certain facts that point towards the gravity of a water crisis are: About 1.1 billion people, or 18 percent of the world's population, lack access to safe drinking water. In addition, 2.5 billion are without proper sanitation. Even though the freshwater supplies are sufficient for the world's population, water scarcity exists due to poor management and distribution of water resources. Unsafe drinking water is the cause of death of more than five million people each year.

This coursework for entrepreneurship module. I need to answer one of

This for entrepreneurship module. I need to answer one of the three following questions. I will write this questions in instructions area - Coursework Example sses has tremendously grown in popularity in the recent past, with a large section of entrepreneurs opting for this route in place of starting their premises from scratch. However, this process may not be the cheapest in numerous aspects, carrying with its fair share of risks as well. It is only through good planning, and business evaluation coupled with a due diligent research of this option that a bought business is capable of surviving the changes that come with the swapping of the ownership. This paper will evaluate the two advantages of buying an existing business as well provide the demerits that come with this process. By weighing between the two aspects, the paper will determine whether taking this route (instead of starting a business from scratch) is a viable entrepreneurial option or not. The paper will first look at the advantages before delving into the disadvantages. I will then provide my verdict on whether the process is a viable entrepreneurial option based on my findings. As earlier mentioned, starting a new business may be dreary and risky especially considering the statistics of failed start-ups available today. A buyer may thus benefit by buying an already established business which helps him/her to skip the first stage that carries the most risk. Buying a business means that the business has passed the test of time and that its model and operations are proven to succeed. Additionally, the buyer enjoys the assurance that comes with a near autonomy of the business operations with them having been honed by the owner during the start-up stage. The buyer of the existing business also does not have to hassle for employees and other vital resources in a business since these may be part of the inherited properties of the business. This saves the buyer important time, energy and finances through processes such as recruitments and hiring. The saved resources can then be invested elsewhere in the business for expansion purposes (Sutherland, 2008:

The Role of Peer Feedback in Improving EFL Writing Skills of Saudi Essay

The Role of Peer Feedback in Improving EFL Writing Skills of Saudi English Major Students - Essay Example The essay explains the role of peer feedback in helping them improve their EFL writing competencies. Following this, a section of the paper presents the concept of peer feedback in detail. Finally, the last section looks at the issue of collaborative learning, in order to provide a theoretical basis for the process of peer feedback to help better understand this type of approach. Many researchers have found a positive relation between students’ writing achievements and the provision of feedback. It is seen that feedback improves writing skills since it gives both students and teachers a picture of students' progress and improvement. It is also considered to be â€Å"a key element of the scaffolding provided by the teacher to build learner confidence and the literacy resources to participate in target communities†. This paper makes a conclusion that peer feedback as it was presented in this essay can be a very beneficial collaborative activity in EFL writing sessions. Unfortunately, this kind of feedback is novel in many non-Western teaching contexts such as Saudi Arabia where teacher-feedback based classes are still dominant. The education system in Saudi Arabia is in the traditional style where it is loaded by rules, and is bound by a certain structure. Saudi students are taught writing by structured written exercises and traditional drills. Students’ writing is most often controlled and guided with model writings provided by teachers rather than allowing them to write freely. However, this situation could be changed with proper awareness of the educational problems and with appropriate writing instructions such as applying cooperative learning and peer feedback to make students better writers.

The Statistical indicators of DSL Subscribers Essay Example for Free

The Statistical indicators of DSL Subscribers Essay The repeating sentences: 2nd repeat: United States and Japan are losing export market shares and new actors are emerging such as Hungary, Finland and Czech Republic. Page 3. Change to Due to the fact that United States and Japan are losing a number of their export market shares, their Balassa index has subsequently decreased. In addition to this, Hungary, Finland, and Czech Republic, as new actors, has much potential with regard to their Balassa index. The RCA index presents information about a country’s comparative advantage in ICT exports of goods and table below makes obvious each country’s gain or lost comparative advantage in ICT export through changes of RCA. RCA equivalent 1 indicates an identical export structure; RCA above 1 indicates relative specialization, while RCA below 1 means a countrys de-specialization. Page 4: kindly delete this paragraph because the term â€Å"RCA† has already been explained and there is no need to introduce this again. Price is consistently a very important issue. Nowadays the supply side hat vast influence of price and it is one of the largest barriers to purchase of broadband service. The Statistical Indicators: In this section, descriptive statistics will be used to describe the characteristics of the data set regarding the DSL subscribers. Different statistical measures will be used and will be introduced in the following sections. Measures of Central Tendency: The value for the mean of the data set is equal to 3251010.03. This means that on the average, there are about 3251010.03 DSL subscribers in the OECD countries. The Median of DSL Subscribers is equal to 1136709.50. This is the middle of the data set which means that half of the OECD countries have DSL subscribers above 1136709.50 and the other half has less than 1136709.50 DSL subscribers. The computed value for the Mode of DSL Subscribers is equal to 60024.00. This means that a number of OECD countries has this much DSL subscribers, more specifically the countries of . Measures of Variability: The standard deviation describes the degree of spread in the data set. If the data lies close to the mean, then the standard deviation is small. The standard deviation for the number of DSL Subscribers is 4645295.15. It shows the amount of deviation from the mean (3251010.03). Apparently, the value of the standard deviation is far from the mean and this shows that the data set has a high degree of spread. The largest number of DSL Subscribers is 19031154.00, which is in the United States, and the smallest number of DSL Subscribers is 60024.00, which is in Luxembourg. Computing for the range, which is the difference between the largest and the smallest value, the result is 18971130.00. This also indicates the degree of spread in the data set since the largest value and the smallest value is far from each other as indicated by the big difference in their range. The value for the Skewness of the data set is 2.08. It means that the distribution of the number of DSL Subscribers is referred to an asymmetric tail extending out to the right or skewed to the right. Correlation between the number of DSL Subscribers and the Monthly Charge In order to find the correlation between the Monthly Charge and the number of DSL Subscribers, the Pearson’s correlation is used.   The results show that the Pearson’s coefficient has a value of -0.355 for these two variables. It shows that the relation between Monthly Charge and the number of DSL Subscribers is negative and it implies inverse association. P-value is equal to 0.027. The P-value is smaller than 5%, which means that there is a correlation between the two factors but with the coefficient less than 0.5, the correlation is said to be weak. The graph below shows the negative relation between the number of DSL subscribers and the Monthly charge. It means that countries with lower Monthly charge have more DSL subscribers. The distribution of countries in the graph is expansive and far from the correlation line. It reaffirms the previous conclusion that the correlation is not strong. Correlation between the number of DSL Subscribers and the Speed of Connection The Pearsons correlation is used to find a correlation between the number of DSL Subscribers and the Speed of Connection. The Pearson’s coefficient is equal to 0.5. With the said value, it can be concluded that there is a positive correlation between the variables Speed of connection and the number DSL Subscribers and it implies direct association. The computed P-value is equal 0.002. Because this value is between 0 and 0.5, it means that there is a direct relation between the two factors where countries with higher connection speed have more DSL subscribers. The graph below shows that there is direct relationship between the number of DSL subscribers and the Speed of Connection. It shows that in countries where the Speed of connection is higher, there are more DSL Subscribers. Correlation between the number of DSL Subscribers and the Monthly Charge and Speed of Connection The possible value for Regression’s coefficient is between 0 and 1. If it is 0, then there is no correlation between factors of regression. If it is equal to 1, then the correlation is perfect. Also, the result of the analysis regression’s coefficient near 1 shows strong correlation. The regression coefficient for measuring the correlation between two variables will be computed. These variables are the Monthly Charge and Speed of Connection as the independent variables and the dependent variable which is the DSL subscribers. The result shows that the regression coefficient value is equal to 0.574. It shows that there is a correlation between Monthly Charge and Speed of Connection with the number of DSL subscribers and this relation is . There is another Index that will be used which is the R2. It is between 0% and 100%. It shows the percentage of change in the independent variables (Monthly charge and Speed of Connection) in relation to the change in dependent variable (number of DSL subscribers). It determines the influence that the independent variables (Charge and Speed) have over the change in the number of DSL Subscribers. The R2 for the current variables is 0.330. It means that 33% of change in the number of DSL Subscribers can be attributed to Monthly Charge and Speed of Connection and rest is from other variables. In addition to this, it is necessary to compute for the Beta Index. This Index determines the influence of each of the two independent variables, Monthly Charge and Speed of Connection. The value of Beta for Monthly charge is negative, which is -0.286. The value of Beta for Speed of Connection is 0.457. Upon a comparison of the value of Beta for the two independent variables, it could be said that the influence of Speed on the number of DSL Subscribers is more significant than the influence of Monthly Charge on the number of DSL Subscribers. In addition, the negative Beta Index of Monthly charge on DSL Subscribers means that as the Monthly Charge decreases, the number of DSL Subscribers increases. The graph below shows this regression. Correlation between number of DSL Subscribers and the Monthly Charge in Middle East The rate of Broadband penetration in Iran and Middle East is insignificant. The table below shows the Broadband penetration in Middle East. -Correlation between the number of Broadband Subscribers and ICT Export in Middle East The data on hand shows that the Pearson’s coefficient value of the number of Broadband Subscribers and ICT Export is equal to .939. It shows that the correlation between number of Broadband subscribers and ICT export is very strong. P-value is equal to 0.000, which means that there is a correlation between Broadband subscribers and ICT export. The Regression’s Coefficient is 0.993 which means that the correlation of the two variables is strong since the value of 0.993 is close to 1. In addition to this, the R2 value is equal to 0.98. It means 98% of the change in the number of Broadband Subscribers in Middle East is related to ICT Export. The graph below shows this regression.    The result can be considered for countries with available data. Due to the fact that there are not many countries with Broadband subscribers, the result cannot hold true for all Middle East countries. -Correlation between number of DSL Subscribers and ICT Export in OECD The variables number of DSL Subscribers and ICT Export in OCED countries is also subjected to the computation for Pearson’s correlation. The P-value is equal to 0.153, which is greater than 5%. It means that there is no correlation between DSL subscribers and ICT export in OECD countries. The value for the Regression’s Coefficient is 0.267 which means that there is a correlation but it is not too strong. The R2 value for the variables is equal to 0.072. It means only 3% of the change in the number of Broadband Subscribers in OECD countries is related to ICT Export. It supports the idea that there is no correlation between DSL subscribers and ICT export. The graph below shows this regression. Iran is the second largest oil producer among the Oil Producing and Exporting Countries (OPEC). Furthermore, it has the worlds second largest reserves of natural gas. This chapter analyses the ICT situation in Iran and it will evaluate the Internet and Mobile penetration in the Middle East region. The research tries to identify the obstacles for development of ICT in Iran and to serve as a basis in the proposal of new policies. There are many active companies competing in the DSL arena in Iran. The major companies and their activities are listed below: Almost all of the governments of Middle Eastern countries control the communication and information media services. Internet access is especially subjected to many restrictions. Some of the most important restrictions are (a) Religious restrictions, (b) Political restrictions, (c) Language restrictions, (d) Speed limitations, (e) Cost of service, (f) Technical problems (disruptions in connectivity). The reasons for most of these problems are the incompatible infrastructures, lack of skill for supporting services, scarcity of local websites, insufficiency for applied economy and life. There are some other local obstacles in each country that complicates the infiltration of Internet access. The table below shows the population and internet users. Moreover, the percentage of the total population with internet access will also be shown. Figure below presents the number of internet users. Iran has the most number of internet users and Bahrain and Iraq have the least number of internet users. The comparison between internet penetration in 2000 and 2005 in this region shows that the growth of all countries is notable. The total growth of Internet users in Middle East from 2000 to the latest data available is 491.4%.   Each country showed an increase in their rate of access to Internet by at least 100%. The figure below displays the percentage of population with access to Internet. The internet user share of population in Israel is the highest while the corresponding shares in Iraq and Yemen remained to be very low. As Figure 2 shows, 51% of Israel’s population have access to internet. United Arab Emirate with 36%, Qatar with 27%, Kuwait with 25%, and Bahrain with 21% followed Israel in the list. Other countries do not enjoy the same privileges where only a low percentage of the total population have access to the internet. The share of Internet users in each country to the aggregate sum of Internet users in Middle East is calculated in the table below. Internet penetration and population of each country can influence the share of Internet users to the sum of Internet users in the Middle East. However, the table below demonstrates the level of interest of each country to communicate with other countries in economic and cultural aspects. The results show that in 2005, Iran has almost 39% of Internet user in Middle East. Israel with 19%, Saudi Arabia with 13%, and United Arab Emirates with 7% has more contributions to assemble total Internet users in Middle East. Figure below displays the share of each country in total Internet users of Middle East. The figure below shows correlation between Mobile population coverage and GDP per capita. The Pearsons correlation is used to find a correlation between GDP and Internet user, GDP and Mobile user, GDP and Fixed telephone. The value of Pearson’s coefficients and the value of P-values show no relationship between GDP and three factors. The GDP does not have any influence in the penetration of Internet, Mobile, and Fixed telephone in the Middle East. The graph below shows a negative relation between the number of DSL subscribers and Monthly charge. It means that countries with lower Monthly charge have more DSL subscribers. The distribution of countries in the graph is very wide and far from the correlation line, which means that correlation is weak.   The Pearsons correlation is used to find a correlation between the variables Population and Internet Users. The Pearson’s coefficient is equal 0.784. It shows that the relationship between Population and Internet users is positive and it implies direct association. P-value is equal to 0.001 and the value is between 0 and 0.5. It means there is a direct relation between two factors. The graph below shows that there is a direct relationship between Population and Internet users. It shows that countries with more population tend to have more Internet users. The Graph below shows this regression. The Regression’s Coefficient is 0.784 and R2 is equal 0.614. It means 61% of the change in the number of Internet Users in Middle East countries is related to population. The graph below shows the relation between all variables. Relationship of each variable in the distribution’s Matrix is determined with other variables in Matrix through the row and column.

Relationship between Inflation and employment rates and GDP

Relationship between Inflation and employment rates and GDP INTRODUCTION 1.1 BACKGROUND Gross Domestic Product as an indicator of wealth and therefore quality of life has long been criticized (Mederly, P. and et al. 2003). Gross Domestic Product (GDP) is the value of total production of goods and services in a country over a specified period, typically a year. The gross domestic product (GDP) or gross domestic income (GDI) is a measure of a countrys overall economic output GDP can be determined in three ways, all of which should in principle give the same result. The most direct of the three is the product approach, which sums the outputs of every class of enterprise to arrive at the total. The expenditure approach works on the principle that all of the product must be bought by somebody, therefore the value of the total product must be equal to peoples total expenditures in buying things. The income approach works on the principle that the incomes of the productive factor must be equal to the value of their product, and determines GDP by finding the sum of all producer s incomes (Bureau of Economic Analysis, U.S Department of Commerce, 2007). The most common approach to measure GDP is the expenditure method: GDP= private consumption + gross investment + government spending + (exports à ¢Ã‹â€ Ã¢â‚¬â„¢ imports) GDP = C + I + G + (X-M) (Equation 1.1) An event in 1975 that remind us the current GDP in our country where the Malaysian economy slumped into its great recession, with a GDP growth rate of only 0.8 percent, compared to 8.3 percent in 1974. This is one of the effects of increase in oil prices and then substantial price increase in 1973 were bought about mainly shortage of food and raw materials arising from bad weather and increased aggregate demand (Cheng, M.Y. and Tan,.H.B. 2002). According to the above circumstances occurred in 1975, the researcher has choosing one of variables that may relate with fluctuation of GDP which is inflation rate. Inflation means either an increase in the money supply or an increase in price levels. Generally, when we hear about inflation, we are hearing about a rise in prices compared to some benchmark. The study of the effects of inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy (Risso, W.A and Carrera, E.J.S, 2009). Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. Results from such studies are particularly important for economies. Besides the inflation, the researcher has considered total employment as one of the variable in the model since economic growth and employment are correlated between each others. The relationship between unemployment and GDP is called Okuns law. It is the association of a higher national economic output with the decrease in national unemployment. This is because in order to increase the economic output of a country, people will need to go back to work, thus lowering unemployment. In order to support the relationship exist between GDP and employment, the researcher has found out the issue supporting the theory that GDP and employment has a positive relationship between each others. According to Hassan, M.K.H. and et al. (2010), in the period of 1996 -1997, the manufacturing sector experienced a rapid growth producing the employment rate in the sector to grow at 7.7 percent per annum but later declining to negative 3.6 percent in 1998 due to the economic recession. In addition, in year 2000, the Malaysian manufacturing sector contributed 33.4% to gross domestic product (GDP), 85.2% to total export and 27.6% to total employment. 1.2 PROBLEM STATEMENT Inflation is a major source of economic instability because it weakens incentives for work and production, distorts the allocate efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. According to study by Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism. Furthermore, inflation also damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of payments (Risso, W.A. and Carrera, E.J.S., 2009). According to Cheng, M.Y. and Tan, H.B. (2002), the economy has experienced episode of high (1973-1974, 1980-1981) and low (1985-1987) regimes of inflation, and was able to contain low and stable inflation during the high economy growth period of 1988-1996. The second problem statement that should be concerns since the employment can affect the economic growth and it is important variable to determine the quality of production for national output and next will influence the GDP of our country. For example, in the early 1990s, the unemployment rate increased for about a year following the end of the previous recession. Coming out of a recession, companies are thought to be reluctant to hire many more workers until they are convinced about the sustainability of a new economic recovery while people who had left the labor force during the recession return to seek to find jobs (Seyfried, W.). Therefore, the researcher conducts this research in order to examine the correlation exists between inflation rate and employment with GDP so that we can help the country to mitigate the problem occurs by supporting the governments policies to increase the countrys GDP. In addition, this research also useful since the results of the studies can be used in policys decision for resource allocation in order to accelerate economic growth. 1.3 OBJECTIVES The objectives of the study are to: 1.3.1 Analyze the relationship between Inflation Rate and Gross Domestic Product in terms of magnitude and direction. 1.3.2 Analyze the relationship between Total Employment and Gross Domestic Product in terms of magnitude and direction. 1.4 SIGNIFICANCE OF THE STUDY The significances of this study are as follow: 1.4.1 Researcher This study will help the researcher to complete their course requirement and will be as guidelines for their field of work in the future. The researcher can gain many experiences in order to complete this research. There are lot of weaknesses may be obtained and this will encourage the researcher to provide the better research in the future. Future researcher will know and more understanding about gross domestic product when conduct this research. It will give the knowledge to the researcher to identify the correlation exist between inflation rate and employment and it always make the researcher briefing to know deeply and applied the study. 1.4.2 Organization This study might help the organization in analyzing the countrys economic condition in order to prevent and reduce the risk during the inflation and know the effects of the crisis occurs to them. This study also may give some guidance to them to protect their company and industry itself. 1.4.3 Public This study can inform and gives some knowledge to the public the relationship between economic growth, inflation rate and employment. They also can make preparation to face the increasing in inflation rate and able to survive in that situation. 1.5 SCOPE OF THE STUDY The researcher chooses to conduct the research about GDP in Malaysia from 2000 until 2010 In this study, the researcher wants to determine the correlation exist between inflation rate and employment with GDP in Malaysia. It is important because as economic planners and forecasters used the GDP per capita in monitoring economic growth trend for time series. The collection of data of GDP, inflation rate and total employment were collected from Department Of Statistics Malaysia in quarterly basis. 1.6 THEORETICAL FRAMEWORK Figure 1.1: Theoretical Framework INFLATION RATE GROSS DOMESTIC PRODUCT EMPLOYMENT RATE RATE Independent variables Dependent Variable Figure 1.1 represents the dependent variable and independent variables in this study. The function of theoretical framework has been clarified by Sekaran, U. (2003) which is a conceptual model of how one theorizes or makes logical sense of the relationship among the several factors that have been identified as important to the problem. Figure above clearly discuss the correlation between Gross Domestic Product which is variable primary to the researcher while Inflation Rate and Employment act as independent variable which is influences the dependent variable. 1.7 HYPOTHESIS In classical test of significant, two kind of hypothesis are used. They are Null Hypothesis and Alternate Hypothesis. Hypothesis is a conjectural statement that describes the relationship among variable even negative or positive. Null hypothesis which is represent by H0 symbol to show that the relationship between independent and dependent variable is not exist. However alternate hypothesis is representing by H1 symbol to show that the relationship is existing between both dependent and independent variable. According to Sakaran (2004), a hypothesis defines as a logically conjectured relationship between two or more variables expressed in the form of testable statement. Relationship a conjectured on the basis on the network of associations established in the theoretical framework formulated for the research study. There are two hypotheses that can describes the correlation exists between dependent variable and independent variables. Therefore the hypothesis that can be tested as follows: Inflation and GDP H0: there is no significant relationship between inflation and GDP. H1: there is a significant relationship between inflation and GDP. Employment and GDP H0: there is no significant relationship between employment and GDP. H1: there is a significant relationship between employment and GDP. 1.8 LIMITATION / CONSTRAINTS The limitations / constraints are: 1.8.1 Time constraint The length of time is limited since the researcher does not have much time to make detailed research. The time provided only three months and the researcher need to divide time properly to complete the research because the process of collecting data is quite difficult. 1.8.2 Cost constraint The cost involves is quite high since as a student, the researcher only depend on the loan applied. Examples of cost involve in order completing this research such as cost of printing, cost of maintaining the laptop, cost of surfing the internet and etc. 1.8.3 Data constraint Since the researcher use the secondary data, the collection of data that have been publish are so limited and the related material are not very supporting the topic of research. 1.8.4 Lack of experience The researcher is less of experience in conducting the research therefore needs to refer the researchers advisor to process the data and learning the skill that needed as a good researcher. CHAPTER 2 LITERATURE REVIEW 2.1 DEPENDENT VARIABLE 2.1.1 GROSS DOMESTIC PRODUCT (GDP) Generally, according to Chan, W.W. and Lam, J.C. (2000), gross domestic product is a common measure of the economic well-being of a society. When government officials plan for the future, they consider the various economics sectors contributed to the gross domestic products. In the other study by Ivanov, S. and Webster, C. (2007), they use the growth of real GDP per capita gr as a measure of economic growth in line with other publications in the field (see Ivanov and Webster, 2007; Lopes et al., 2002; Plosser, 1992). The function of GDP also has been explained by Kosmidou, K. (2008) where gross domestic product (GDP) is among the most commonly used macroeconomic indicators, as it is a measure of total economic activity within an economy. The gross domestic product growth (GDPGR), calculated as the annual change of the GDP, is used as a measure of the macroeconomic conditions. The significance between GDP, foreign trade and foreign direct investment has been discussed by Liu Ying and Cui Riming (2008) where the economy is highlighted by the significant performance of both its economic growth and its foreign trade and foreign direct investment. Under this background, the correlation of foreign trade, foreign direct investments and economic growth in has become an important issue for academic research. Previous studies support that foreign trade and foreign direct investment have positive impacts on gross domestic product (GDP). In the study by Malul, M. and et al. (2008), the GDPpc is used mainly to compare the standard of living in different countries. It means that the higher of cost of living in a country, the higher earning of gross domestic product of the country. According to Wong, K.Y.(2008),economic growth of an economy refers to the expansion of its production possibility set, as a result of accumulation of primary factors such as labor and capital (physical and human), or improvement of production technologies. However, because the production possibility frontier (PPF) of an economy is not observable, economic growth is usually measured in terms of the growth rate of some observable variables such as real GDP or real per capita GDP. Besides that GDP also one of the result of the countrys economic activities based on the statement of Daly and Cobb (1989), GDP expresses the content of physical flows of capital, industrial production, services, resources and agricultural product. The scientific research has been conducted by Ligon and Sadoulet (2007) using a sample of 42 countries show that GDP growth, which comes from agriculture is at least twice as effective in reducing poverty compared to GDP growth coming from nonagricultural areas. In order to know the correlation between inflation and growth, Gokal, V. and Hanif, S. (2004), stated that the tests revealed that a weak negative correlation exists between inflation and growth, while the change in output gap bears significant bearing. The causality between the two variables ran one-way from GDP growth to inflation. While, according to some consensus exists, suggesting that macroeconomic stability, specifically defined as low inflation, is positively related to ec onomic growth. 2.2 INDEPENDENT VARIABLES 2.2.1 INFLATION RATE (INF) Inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy. Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. According to Andres and Hernando (1999), for example, reducing inflation by one percentage point when the rate is 20 percent which results in an increase in the growth rate of 0.5 percent, compared to reducing inflation by one percentage point when the inflation rate is around 5 percent, which results in a decrease in the growth rate by 1 percent. Furthermore, a study by Mallik and Chowdhury (2001), the structuralisms argue that inflation is necessary for economic growth, whereas the monetarists argue the opposite, that is, inflation is detrimental to economic growth such debate started in the 1950s, focused on developing countries, which had long suffered fro m low-growth rates with high rates of inflation and larger deficits in the balance of payments. In order of inflation, the monetarists argue that price stability promotes economic growth and protects the balance of payments. They argue that inflation is major sources of economic instability because it weakens incentives for work and production, distorts the allocative efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. They also argued that inflation damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of-payments. To monetarists, stable prices are the starting point in the process of economic development. The policy choice of a country would be stabilization with growth, or stabilization without growth. Several papers are typical of the monetarist tradition. To argue that, according to Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism proposed a model where the agents decide the level of labor output, and an increase in inflation reduces labor supply, and producing a decrease in economic production. On the other hand, a study by Mundell and Tobin (1965), the structuralizes argue that inflation normally accompanies economic growth in developing countries because structural rigidities and bottlenecks in supply sectors prevent the elastic supply of some basic commodities such as food, housing, energy, and transportation. Increased income as a result of growth would expand demand for such basic commodities, and prices would rise. The structuralize position is that economic difficulties in developing countries have roots deeper than just the results of inflation. Thus, structuralizes thought that inflationary pressures and det erioration in the balance of payments inevitably are attendant matters of economic growth. In developing countries, there thus would be a trade-off relationship between economic growth and inflation and an attendant deterioration in balance of payments. If a developing country wants stabilization of prices and balance of payments, it must reduce the speed of economic growth, including a sacrifice of employment. Among scholars who support the structuralize position on a positive relationship between inflation and economic performance, predict a positive relationship between the rate of inflation and the rate of capital accumulation, which in turn implies a positive relationship to the rate of economic growth. But, DeGregorio (1996) and Fischer (1926) pointed out, since money and capital are substitutable, an increase in the rate of inflation increases capital accumulation by shifts in portfolios from money to capital and thereby stimulate a higher rate of economic growth was the first to establish a negative correlation between inflation and unemployment. According to Grier and Grier (2006), it presents evidence on the real effects of inflation and inflation uncertainty on output growth. Their main findings are as follows: Inflation uncertainty has a negative and significant effect on growth Once the effect of inflation uncertainty is accounted for, lagged inflation does not have a direct negative effect on output growth; and As predicted higher average inflation raises inflation uncertainty, and the overall net effect of average inflation on output growth. Differ with theory of Bortis, H. (2004), he argues that inflation is a macroeconomic phenomenon represented by a gap between global supply and global demand. Inflation affects the money-output relationship, as does deflation; both phenomena modify the purchasing power of money over domestic output. In this view, price indices cannot come to grips with the inflation phenomenon. While Cheng and Tan (2002) in their study inflation in Malaysia, suggested that main factors affecting Malaysian inflation were external (foreign trade, foreign direct investment and technology transfer). Malaysia has been comparatively successful in balancing strong economic growth with moderate levels of inflation in the periods preceding and following the Asian Financial crisis. Actually, empirical results related to low and medium inflation are of a mixed nature; some papers (mainly these analysing the developed economies) argues that moderate inflation negatively affects growth (e.g. Alexander, 1997, Gillm an et al. 2002; Gillman and Harris 2009; Gillman et al. 2001; Fischer 1993; De Gregorio 1992 and 1993) while other argues that moderate inflation is actually stimulating growth. On the theory side Friedman (1977) in his Nobel lecture argues that a positive relationship between the level of inflation and inflation uncertainty. Friedman points out higher inflation leading to greater uncertainty, which lowers welfare and efficiency of output growth. On the other hand, Ball (1992) formalizes Friedmans hypothesis using an asymmetric information game where public faces uncertainty regarding the type of policymaker in the office. One of the policymaker is willing to tolerate a recession to reduce inflation and the other is not. During the low inflation time, both type of policymakers will attempt and try to keep it low. But, when inflation is high, only the tough type or anti-inflation policymaker will bear the economic costs of disinflation. The argument that central banks should emphasize holding down inflation comes from the beliefs that inflation has an adverse effect on macroeconomic variables, such as output and productivity growth. According to Clark (1982), inflation causes misperception of the relative price levels and leads to inefficient investment plans and therefore affects productivity inversely. Furthermore, inflation erodes tax reductions for depreciation and raises the rental price of capital, which in turn causes a reduction in capital accumulation and therefore in labour productivity. In addition, according to Feldstein (1982) inflation disrupts investment plans by imposing a higher tax rate on corporate profits and through higher effective tax rates on corporate income and accordingly affects productivity (Gilson, 1984; Boskin et al., 1980). Finally, inflation distorts price signals and reduces the ability of economic agents to operate efficiently (Smyth, 1995). According to Chen and et al. (1991), it has documented a significant relationship between the US stock returns and real economic variables such as industrial production, real GNP, interest rates, inflation and money supply. Besides that, there are also otherwise arguments that there is no relation between inflation rate and gross domestic product in the long run. For instance, Faria and Carneiro (2001) investigate the relationship between inflation and output in the context of an economy facing persistent high inflation and they find that inflation does not affect real output in the long run, but that in the short-run inflation negatively affects output. In addition, scholars such as Sidrauski (1967) suggest that there is no relationship between inflation and economic growth, supporting the hypothesis of super neutrality of money. On the other hand, Sarel (1995) asserts that there is a nonlinear relationship between inflation and economic growth. Using 87 countries, he finds the existence of an inflation threshold of 8 percent. Above the threshold there is a negative relationship between inflation and economic growth, whereas under the threshold there is a positive but not significant relationship. The others studies in order to prove Sarels result, Judson and Orphanides (1996) divide Sarels sample of countries into three groups, and they find similar results to Sarel, finding a threshold of 10 percent. Ghosh and Phillips (1998a, b) study 145 countries in the period 1960-1990 again finding similar results. Paul et al. (1997) study 70 countries (of which 48 are developing economies) for the period 1960-1989. They find no causal relationship between inflation and economic growth in 40 percent of the countries, bidirectional causality among 20 percent of the countries, and unidirectional causality for the rest (either inflation to growth or vice versa). Lastly, Mendoza (1998) finds that inflation has had no effect on Mexicos long-run economic growth since he conducted the study of inflation in Mexico. 2.2.2 EMPLOYMENT Some of studies have been conducted to examine the relationship between gross domestic product and employment. For instance, according to Okun (1962) and Philips (1958), they found different relationship both of these. Okun found a negative correlation between unemployment and economic growth, then from both propositions it can be deduced a positive relationship between economic growth and inflation while Phillips proposed a positive relationship between inflation and unemployment implying the same type of relationship. In addition, Boltho and Glyn (1995) found elasticities of employment with respect to output growth in the order of 0.5 to 0.6 for a set of OECD countries. While according to Evangelista and Perani (1996) discovered evidence suggesting that restructuring of major economic sectors reduce the relationship between economic growth and employment. A specific research conducted by Seyfried, W., among the G7 countries (Canada was excluded), a positive and significant relationship between growth in value added and employment was found only in Germany and the US. In addition, according to Verdoon (1949) and Kaldor (1966), an increase in output growth of 1 percent leads to an increase in productivity and employment growth of half a percentage point each. It should be noted that the higher the productivity effects of growth, the more difficult it will be to keep unemployment from rising. According to Okuns Law an increase of the economic growth rate by 3 percent (above the normal rate) was expected to reduce the unemployment rate by 161 percentage point. Or, to put it the other way round: The gain of real GDP associated with a reduction in unemployment of one percentage point was estimated to be 3 percent. Several studies also have been conducted to examine the correlation exists between employment and inflation rate. One of the studies by Spithoven, A.H.G.M. (1995), by the end of the 1960s evidently there was no fixed relationship between unemployment and inflation. Empirical research revealed that the relationship was not consistent over time and varied sharply between countries. This was explained as follows: in the short run higher nominal wages attract more labour and engender a fall in the rates of unemployment. As soon as the workers recognize the wage rise to be purely nominal they abstain from work, and unemployment is restored to the pre-wage-rise level, but with a level of prices higher than before. Secondly, according to Brenner (1991), confronted with a combination of unemployment and inflation (stagflation), many governments abandoned efforts to regulate the economy by the Keynesian instruments. They declared fiscal policies ineffective and sought refuge in a mixture of m onetary measures with supply-side economics. According to Keynes (1946), the volume of employment is given by the point of intersection between the aggregate demand function and the aggregate supply function. This was naively interpreted and construed to imply that a rise in costs and with this was meant a rise in costs owing to increasing government expenditure will result in an upward shift of the supply curve and will cause greater unemployment and inflation. CHAPTER 3 RESEARCH METHODOLOGY AND DESIGN 3.1 MODEL SPECIFICATION This study is to examine the correlation exists between inflation rate and total employment with gross domestic product. It uses secondary data which is based on time series data. The collection of time series data from 1982 to 2006 and the scope is in Malaysia. The researcher applied STATA software to process the data and log-log model in this study. The model applied a log transformation, since log transformations help, at least partially, to eliminate the strong asymmetry in the distribution of inflation (Sarel, 1995) and (Ghosh and Phillips, 1998a, b). The logarithm equation is written in the Equation 3.1. GDP = ÃŽÂ ± + ÃŽÂ ²1In(INF) + ÃŽÂ ²2ln(EMP) + ÃŽÂ µ (Equation 3.1) Where, GDP = Gross Domestic Product ÃŽÂ ± = Constant ÃŽÂ ²1 = Inflation ÃŽÂ ²2 = Employment ÃŽÂ µ = Error term In above equation, it shows clearly dependent variable that has been applied in this study is gross domestic product, besides that, the researcher also used two independent variables which are quantitative variables, they are inflation rate and total employment. 3.1.1 DEPENDENT VARIABLE The dependent variable is the variable of primary interest to the researcher. The researchers goal is to understand and describe the dependent variable, and to explain its variability, or predict it (Sekaran, 2006). Dependent variable of this study is factor contributed to the gross domestic product. According to Zikmund (2000), independent variable is a criterion that predicted or explained. It show that the component contributed to improving of gross domestic product depend on the listed independent variables. 3.1.2 INDEPENDENT VARIABLES According to Zikmund (2000), independent variables that expected to influence the dependent variable. Refer to (Burn and Bush, 2000), independent variables are those variables over which the researcher has some control and wishes to manipulate. In this study, two independent variables will influence the dependent variables. They are inflation rate and employment. 3.2 DATA SET AND METHODOLOGY The collections of data in this research only gain from secondary data and based on time series data which are from 2000 to 2010. The researcher has considered annual data of real GDP, inflation rate and employment. All the data on the growth rate of real GDP, Inflation and total employment were obtained from Department of Statistics Malaysia database. GDP is considered per capita. In addition, according to Aigenger (2005) per capita real GDP is also used as an alternative measure of productivity, as some theoretical models do. Moreover, according to OECD (2001), living standards as represented by per capita income reflects productivity since the former is determined, to a significant extent, by the latter. CPI consider in weight 100 while employment in number of labor. The variables were selected based on relevant economic theories that allow for the interaction among inflation rate and total employment in addition to response to GDP. 3.3 TECHNIQUE ANALYSIS DATA In this research, the researcher has applied unit SPSS in order to determine time series data is stationary or non stationary about the correlation between inflation rate and employment with gross domestic product. The researcher examines the existence of a long-run relationship between inflation and employment with GDP using a vector error-correction model (VECM) after applying Johansens (1988, 1990, and 1995) cointegration technique. We conduct a test for weak exogeneity in order to do inference. Then, the researcher conduct stability test by using Jarque Bera test in order to test normality distribution between the variables selected. Finally, a modified version of the Granger causality test is applied in order to analyze causality between the variables. 3.4.1.1 Multiple Regression Analysis Multiple Linear regression analysis is an analysis of the relationship between one variable (dependent variable) and set of variable (independent variables). It is used by the researcher to test the hypothesis. As in all hypothesis tests, the goal is to reject the null hypothesis and accept the alternative hypothesis. This technique will identify how much of the variance in the dependent variables can be explained by independent variables. This analysis is used primarily for the purpose of pre