III. Application/Activity
Discuss and research the following extensively:
1. Why is there a global recession?
-A global recession is a prolonged phase of global economic downturn. As trade
ties and international financial structures relay economic shocks and the effects
of recession from one country to another, a global recession entails more or less
synchronized recessions across many national economies. As we saw during the
U.S. financial crisis, financial factors will certainly lead to an economy's collapse
into recession. Excessive credit and debt on risky loans and marginal borrowers
will result in a massive risk build-up in the financial sector. The Federal Reserve
and the banking sector will push this process by increasing the availability of
capital and credit in the economy.
2. Why are more and more Americans flocking to pawnshops?
-More people are turning to pawn shops for quick cash. According to a new study
by Market data Enterprises, more Americans are turning to pawn shops to get by,
selling jewelry, gadgets, equipment, and other personal items for fast cash.
3. If you were the Head of Collection Department in a company, how would
you improve its collection system?
-If I were the Head of Collection Department in a company, I would improve its
collection system in many ways such as: (1) Calculate the art and create an A/R
aging study. Determine the actual payment status of all your accounts
receivables as the first step in taking care of your collections efforts.(2) Invoice
and collections efforts should be proactive. Making sure both parties are on the
same page about payment dates, sums due, and payment received is one of the
most critical measures in ensuring on-time payment. (3) Get rid of past-due
receivables as soon as possible. According to studies, the more receivables go
unpaid, the less likely they are to be received in full or in part. (4) Consider
offering a discount for paying in advance. (5) Think of providing a payment plan.
After a few payment reminders, a past-due client might tell you that they're
having cash flow issues and need an extension to pay their bill. (6) strengthen
your client base. When it comes to accounts receivable payments, small
companies always get the short end of the stick.
4. If you were a consultant to Hyundai Motor’s Credit Card, propose some
strategies to improve its business.
-If I were a consultant to Hyundai Motor’s Credit Card, I will propose some
strategies such as: (1) Concentrate each product on a single customer
requirement. You gain the opportunity to present more successful value offerings
to customers and a customer base that acts as predictably as possible by
concentrating each credit card offer on a distinct consumer need, making it
easier to forecast card profitability and change marketing strategies based on
early returns. (2)Bring marketing and underwriting together. Too frequently, credit
card companies' marketing and underwriting departments are separate bodies
