Derivatives and Risk Management

Questions: 1. To propose specific hedging strategies which require you to describe the following: i. the exposures to be hedged, ii. what percentage proportion of the exposure is to be hedged, iii. which derivative(s) are to be used to hedge each exposure, iv. the number of derivative contracts for each hedge, v. the delivery months (or duration of swaps) for each derivative, and vi. the prices at the time of making the recommendation - futures prices, option strike prices (including an explanation of the choice of strike price(s)] and theinterest rate for currency swaps (you will need to research this- use actual data). 2. Is the company adequately hedged? Why or why not? What are your recommendations? Answers: Introduction: (1). In the present report, we have selected a company named, Sonic Health Care Limited for the presenting recommendations about different hedging strategies using different transaction exposures. Actual data of financial year 2015 has been used for the said purpose assuming the hedging horizon of mid- December and for future and options, expiry date of December has been considered (sonichealthcare.com). In current market scenario, there are transaction, translation and economic or operating exposure, which are required to be hedged. Transaction and translation exposure falls under accounting exposure. i. Exposures that are required to be hedged, considering the selected company Pacific Energy Limited can be done through the following instruments: Forward contract Derivatives Money Market Hedge Currency invoicing and risk sharing Exposure netting. Forward contract is an arrangement by which two parties, buyer and seller agrees to enter in a contract on the spot date of the event to make payment in future at an agreed currency rate which takes place over the counter (Chance and Brooks, 2015). Derivatives comprise of Futures and Options which derives their value from underlying share price. Unlike forward contract, derivates are traded on exchange with mark to market feature in case of futures whereas, in case of options buyer has the right and not obligation to buy or sell the securities before a future fixed date in form of call or put option (Cuong and Toan, 2016). Money market, currency invoicing is a market where currencies are bought and sold at the rates regulated by Reserve Bank for the purpose of hedging (Devalkar, Anupindi and Sinha, 2016). Exposure netting means the set off between receivables and payables, which eliminates the risk as well as cost of the hedging process (Feng, 2015). From the data and explanations provided in the annual report 2015 (sonichealthcare.com), Sonic Healthcare Limited seemed to use currency and derivatives exposures to hedge itself. In the year 2015 Sonic Healthcare hedged itself for around 164,000 $ from forward contract. ii. Traditionally, there were two extremes to hedge the exposures, fully hedge i.e. 100% and no hedge (0 %). However, this strategy of hedging is not advisable as both the extremes involve either huge cost or huge risk. Therefore, to present an optimum proportion of exposure to be hedged was derived by Fisher Black formula which is used universally. The formula has been derived using the three inputs i.e. expected return on market portfolio and volatility of portfolio and market exchange rate (Tessema, 2016). It has also noted that there is another approach for optimum proportion of exposure to be hedged which is 50 % approach, known as minimizing, maximizing regret. This method is advised for short time periods and when the market rates maintain consistency with Purchasing power parity (PPP). iii. As mentioned in the above points, derivatives that should be beneficial to use are forward contract, futures, money market and netting of exposure (Wing and Jin, 2015). These derivates have been suggested with regard to market risk elimination, low cost in the course of hedging and parity in purchasing power for both payer and receiver. iv. Sonic Healthcare limited has received on exercising options, net cash amounted to $13M and number of options granted to its Directors in the month of September 2015, 2,465,418 options to one director and 1,181,485 options to another director. Further, the number of options granted in the current financial year is represented with the help of the following figure.Figure 2: Table showing number of options granted Figure 3: Table showing option plan v. The duration of swap of derivatives is the difference between the duration of fixed- rate bond and floating- rate bond, which is derived by dividing the present value of cash flows by the price of, bonds (Tessema, 2016). vi. Future price for the year 2015 of Sonic Healthcare Limited (sonichealthcare.com) as per Australian stock exchange was 50.180 $ with ASX code- AAA while that of US contracts 394.6 $. Options strike prices of both the US and Australia stock exchange revolves in the same direction i.e. $ 52.19 to 301.6 $ in the month of December horizon. This strike price has been selected to express the market volatility in the both the stock exchanges while interest swap rate is around 4%- 5%. Hence, it is advisable that to hedge the cash flows, company can use option spread by buying an option in Australia Stock Exchange at strike price $52.19 while going short in US stock exchange. (2). In considerations with the available data and prices, Sonic Healthcare Limited is partially hedged in the financial 2015 as well as in the year 2014. This was analyzed from its annual report wherein effective income from cash flow hedging stands to around $ 164,000 in 2015 and $ 1,550 in the year 2014. Though it seemed to be a sound hedge exposure (Wing and Jin, 2015), it is being recommended that the entity should maintain the strategy in future years including more transaction exposures in money market. Conclusion: The present report has been dealt with the various types of hedging strategies in the market portfolio and the exposure used by Sonic Healthcare Limited considering the factual data available from various sources. It has been recommended further that the enterprise is adequately hedged along with evidences and reasons thereof. Reference List: Chance, D. and Brooks, R., 2015.Introduction to derivatives and risk management. Cengage Learning. Cuong, D.X. and Toan, N.Q., 2016. Derivatives as the Price Fluctuation Risk Management for Vietnamese Coffee Exporters.Research in World Economy,7(1), p.p59. Devalkar, S.K., Anupindi, R. and Sinha, A., 2016. Dynamic risk management of commodity operations: Model and analysis.Indian School of Business Research Paper Series. Feng, Q., 2015, June. The use of derivatives, corporate risk management and firm financial performance: Evidence from non-financial listed companies in Zhejiang province, China. InEducation Management and Management Science: Proceedings of the International Conference on Education Management and Management Science (ICEMMS 2014), August 7-8, 2014, Tianjin, China(Vol. 7, p. 55). CRC Press. Tessema, A.M., 2016. Accounting for derivatives and risk management activities: The impact of product market competition.International Journal of Accounting and Information Management,24(1), pp.82-96. Wing, L.C. and Jin, Z., 2015. Risk management methods applied to renewable and sustainable energy: a review.Journal of Electrical and Electr

Psychological Concept of Humans Eating Behavior

Introduction Studies examining the eating behaviours of various individuals show that the amount of food consumed is directly affected by outside environmental food cues which trigger a response which causes the feeling of hunger which in turn causes a person to eat (Hepworth et al, 2010).Advertising We will write a custom report sample on Psychological Concept of Humans Eating Behavior specifically for you for only $16.05 $11/page Learn More Not only that, the amount of food consumed has been shown to marginally increase depending on the type and level of the environmental attribute attempting to influence an individual (Cohen, 2008). This can come in the form of appearance, smell or even personal preference towards a particular food type which triggers the response for the body to get hungry (Van der Laan et al., 2011) (Radnitz et al., 2009). It must be noted that food cues can be considered a form of conditioned stimuli for the body wherein after a ce rtain degree of exposure the body reacts through the production of increased salivation and changes in blood glucose levels in order to prepare the body for the intake of food (Hou et al., 2011). Such a reaction is similar to what is seen in various Pavlovian conditioning mechanisms wherein after a certain time the body reacts in a predetermined fashion after continuous environmental cues which creates the behaviour (Boggiano et al., 2009). In this particular case it is the exposure to food cues which in turn causes the body to react as a result of an inherent conditioning mechanism. It can even be assumed that the sudden feeling of hunger individuals experience after being exposed to a food cue can thus be attributed to the body’s inherent Pavlovian conditioning mechanism wherein in expectation of the consumption of food the body reacts in a predetermined fashion such as changes in blood glucose levels, the increased release of stomach acids and greater degrees of salivation (Galarce et al., 2010). As such, this reaction is attributed to the condition of being hungry when in fact it was the result of a food cue and not a denial of earlier sustenance that caused the reaction. On the other hand, such a reaction does not happen on a continuous case to case basis, in fact in some cases wherein despite the level of exposure involved the desire to eat does not manifest itself as readily in some individuals compared to others (Polivy et al., 2008). This lack of desire or rather behavioural resistance to the compulsion of eating is thus attributed to the concept of restraint which refers to an individuals concern over their food intake versus the amount their body actually needs (Geyskens et al, 2010) (Cornier et al., 2009).Advertising Looking for report on health medicine? Let's see if we can help you! Get your first paper with 15% OFF Learn More It must be noted that the concept of restraint varies per individual as evidenced by the rising fac tors of obesity within the U.S., Europe and various other countries (Hollitt et al., 2010) (Ouwehand Papies, 2010). It has been shown by various studies that distinct behavioural traits of which restraint is included directly factor in to the caloric intake of an individual however various studies have been inconclusive as to how a factor such as restraint adequately develops in an individual so as to resist the compulsion to eat when presented with a food cue (Loxton et al., 2011). Based on the presented data, this study assumes that by examining the scores at different levels of restraint specific individuals can be identified within the test subjects who respond differently to food cues or neutral cues. This data can thus be utilized to further examine the developmental attributes of restraint and how it manifests in certain people. Discussion The results of the experiment showed that the overall mean of hunger levels in neutral or control condition was lower than in food condit ion which was to be expected given the nature of the testing phase since common sense dictates that people would have a much greater Pavolovian reaction to pictures of food (as mentioned earlier in the introduction) as compared to inedible objects. While in the case of high-restrainers they had a bigger score of hunger in both conditions there was no significant difference in the change of the hunger score of low restraint group in neutral and food-cues conditions. It must also be noted that there was no significant difference was found in the change of the hunger level in high restraint group in neutral and food-cues conditions. Finally a significant finding of the study was that the hunger score of high-restrainers’ had increased significantly more than in low- restrainers’ group. Based on the results of the study it can be seen that the experiment showed no significant difference in high- and low-restrainers’ hunger rating in neutral- and food-cue presentatio ns. An examination of various studies involving food cues reveals that the reason behind the results of the study can be connected to the type of food cue used to illicit a response from the subject (Loxton et al., 2011).Advertising We will write a custom report sample on Psychological Concept of Humans Eating Behavior specifically for you for only $16.05 $11/page Learn More In other experiments it was shown that by utilizing both visual and olfactory senses in order to stimulate the subject a greater degree of rating difference was seen between high and low restrainers. It was noted by the studies that while visual cues can be used as a method of eliciting a particular response the researchers found that using a blindfold test the participants exhibited a greater response in terms of smell as compared to visual stimuli (Hepworth et al, 2010). On the other hand a combination of both resulted in a far greater degree of hunger rating. The reason behind th is is attributed to the fact that human response mechanisms have different reactive traits based on the degree and type of stimuli involved. Various marketing studies have shown that while visual representations do illicit a form of hunger, when other sensory mechanisms are included into the assessment the level of hunger actually increases (Brignell et al., 2009). In fact the results of such studies have been implemented in various fast food establishments utilizing the â€Å"open kitchen† concept wherein the smells and visuals presented by the establishment help to increase the rate of hunger resulting in that particular person ordering more than initially intended (Geyskens et al, 2010). It was also shown that static pictorial representations of food often times don’t do as well as compared to moving graphical representations hence the fact a majority of modern day food commercials often show the food being prepared and moving which has been shown to illicit a great er response (Schur et al., 2009). It is assumed that the basis behind this particular response is due to the fact that food that is moving is thought to be more â€Å"real† for the audience. Static representations such as those seen in pictures have a less effective response due to the fact that the perception of the individual viewing the photo interprets it as nothing more than a mere photo (Forzan et al., 2010). Conclusion It can be assumed that when an individual is presented with either a static representation or a moving graphic visualization it can be expected that the latter will draw out a greater hunger response (Van der Laan et al., 2011).Advertising Looking for report on health medicine? Let's see if we can help you! Get your first paper with 15% OFF Learn More While the research supported the hypothesis of a significant interaction which occurred in hunger levels between high- and low- restraint groups in control and test condition the fact remains that upon closer examination of the methods utilized in this particular study compared to others it is revealed that a mere static picture is an insufficient method of drawing out an appropriate response (Piech et al., 2010). This evidenced by the fact that the experiment evidenced no significant difference in high- and low-restrainers’ hunger rating in neutral- and food-cue presentations. As such it is recommended for future studies utilizing the same principals to use food cues that stimulate more than one sense so as to get a more accurate level of distinction between hunger ratings. References Brignell, C, Griffiths, T, Bradley, B, Mogg, K 2009, ‘Attentional and approach biases for pictorial food cues. Influence of external eating’, Appetite, 52, 2, pp. 299-306, Academi c Search Complete, EBSCOhost. Boggiano, M, Dorsey, J, Thomas, J, Murdaugh, D 2009, ‘The Pavlovian power of palatable food: lessons for weight-loss adherence from a new rodent model of cue-induced overeating’, International Journal of Obesity, 33, 6, pp. 693-701, Academic Search Complete, EBSCOhost. Cohen, DA 2008, ‘Obesity and the built environment: changes in environmental cues cause energy imbalances’, International Journal of Obesity, 32, pp. S137-S142, Academic Search Complete, EBSCOhost. Cornier, M, Salzberg, A, Endly, D, Bessesen, D, Rojas, D, Tregellas, J 2009, ‘The Effects of Overfeeding on the Neuronal Response to Visual Food Cues in Thin and Reduced-Obese Individuals’, PLoS ONE, 4, 7, pp. 1-7, Academic Search Complete, EBSCOhost. Forzano, L, Chelonis, J, Casey, C, Forward, M, Stachowiak, J, Wood, J 2010, ‘SELF-CONTROL AND IMPULSIVENESS IN NONDIETING ADULT HUMAN FEMALES: EFFECTS OF VISUAL FOOD CUES AND FOOD DEPRIVATION’ ,  Psychological Record, 60, 4, pp. 587-607, Academic Search Complete, EBSCOhost. Galarce, E, McDannald, M, Holland, P 2010, ‘The basolateral amygdala mediates the effects of cues associated with meal interruption on feeding behavior’, Brain  Research, 1350, pp. 112-122, Academic Search Complete, EBSCOhost. Geyskens, K, Soetens, B, Roets, A 2010, ‘Exposure Makes the Heart Grow Less Fond!: The Effects of Exposure to Palatable Foods on the Subsequent Attention Processing of Food Cues’, Journal of Health Psychology, 15, 2, pp. 230-238, Academic Search Complete, EBSCOhost. Hepworth, R, Mogg, K, Brignell, C, Bradley, B 2010, ‘Negative mood increases selective attention to food cues and subjective appetite’, Appetite, 54, 1, pp. 134-142, Academic Search Complete, EBSCOhost. Hou, R, Mogg, K, Bradley, B, Moss-Morris, R, Peveler, R, Roefs, A 2011, ‘External eating, impulsivity and attentional bias to food cues’, Appetite, 56, 2, pp. 424-427, Academic Search Complete, EBSCOhost. Hollitt, S, Kemps, E, Tiggemann, M, Smeets, E, Mills, J 2010, ‘Components of attentional bias for food cues among restrained eaters’, Appetite, 54, 2, pp. 309-313, Academic Search Complete, EBSCOhost. Loxton, N, Dawe, S, Cahill, A 2011, ‘Does negative mood drive the urge to eat? The contribution of negative mood, exposure to food cues and eating style’, Appetite, 56, 2, pp. 368-374, Academic Search Complete, EBSCOhost. Ouwehand, C, Papies, E 2010, ‘Eat it or beat it. The differential effects of food temptations on overweight and normal-weight restrained eaters’, Appetite, 55, 1, pp. 56-60, Academic Search Complete, EBSCOhost. Piech, R, Pastorino, M, Zald, D 2010, ‘All I saw was the cake. Hunger effects on attentional capture by visual food cues’, Appetite, 54, 3, pp. 579-582, Academic Search Complete, EBSCOhost. Polivy, J, Herman, C, Coelho, J 2008, ‘Caloric restriction in t he presence of attractive food cues: External cues, eating, and weight’, Physiology Behavior, 94, 5, pp. 729-733, Academic Search Complete, EBSCOhost. Radnitz, C, Byrne, S, Goldman, R, Sparks, M, Gantshar, M, Tung, K 2009, ‘Food cues in children’s television programs’, Appetite, 52, 1, pp. 230-233, Academic Search Complete, EBSCOhost. Schur, E, Kleinhans, N, Goldberg, J, Buchwald, D, Schwartz, M, Maravilla, K 2009, ‘Activation in brain energy regulation and reward centers by food cues varies with choice of visual stimulus’, International Journal of Obesity, 33, 6, pp. 653-661, Academic Search Complete, EBSCOhost. Van der Laan, L, de Ridder, D, Viergever, M, Smeets, P 2011, ‘The first taste is always with the eyes: A meta-analysis on the neural correlates of processing visual food cues’, NeuroImage, 55, 1, pp. 296-303, Academic Search Complete, EBSCOhost. This report on Psychological Concept of Humans Eating Behavior was written and submitted by user Brianna Snyder to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Barack Obama - Eleventh (Final) President-Elect Weekly Transition Address free essay sample

Different Types of Metaphors

Different Types of Metaphors Metaphors arent merely the candy sprinkles on the doughnut of language, not just embellishments to the music of poetry and prose. Metaphors are ways of thinking- and also ways of shaping the thoughts of others. All people, every day, speak and write, and think in metaphors. In fact, its hard to imagine how people would get by without them. And because figurative comparisons lie at the heart of language and thought, they have been picked apart by scholars in a variety of disciplines. Types of Metaphors There are countless ways of looking at metaphors, thinking about them, and using them. There are countless ways of looking at metaphors, thinking about them, and using them. But in deference to the metaphorical blackbirds of Wallace Stevens (The blackbird whirled in the autumn winds./It was a small part of the pantomime), here are a few of them. Absolute: A metaphor in which one of the terms (the tenor) cant be readily distinguished from the other (the vehicle).Complex: A metaphor in which the literal meaning is expressed through more than one figurative term (a combination of primary metaphors).Conceptual: A metaphor in which one idea (or conceptual domain) is understood in terms of another.Conventional: A familiar comparison that doesnt call attention to itself as a figure of speech.Creative: An original comparison that calls attention to itself as a figure of speech.Dead: A figure of speech that has lost its force and imaginative effectiveness through frequent use.Extended: A comparison between two unlike things that continues throughout a series of sentences in a paragraph or lines in a poem.Mixed: A succession of incongruous or ludicrous comparisons.Primary: A basic intuitively understood metaphor such as knowing is seeing or time is motion that may be combined with other primary metaphors to produce complex metaphors. Root: An image, narrative, or fact that shapes an individuals perception of the world and interpretation of reality.Submerged: A type of metaphor in which one of the terms (either the vehicle or tenor) is implied rather than stated explicitly.Therapeutic: A metaphor used by a therapist to assist a client in the process of personal transformation.Visual: The representation of a person, place, thing, or idea by way of a visual image that suggests a particular association or point of similarity. Regardless of the types of metaphors you favor, keep in mind Aristotles observation 2,500 years ago in Rhetoric: Those words are most pleasant which give us new knowledge. Strange words have no meaning for us; common terms we know already. It is metaphor which gives us most of this pleasure.

Compares three broad themes found in the film The Atomic Cafe and the Essay

Compares three broad themes found in the film The Atomic Cafe and the book Lost Girls by (kolker) - Essay Example The prominent themes found in both the pieces of work are violence, social callousness, and the deceptiveness of the government authorities. The callosity of few social institutions and the deceptive nature of the governmental authorities affect the public welfare leading to calamities that have some long-lasting impact on the society. These acts of violence tend to show the vulnerability of the society and are clearly evidenced in the incidents discussed in both the novel and the film. Kolker’s book recounts the traumatic life of five young sex workers, Shannan Gilbert, Maureen Brainard-Barnes, Melissa Barthelemy, Megan Waterman and Amber Overstreet Costello, who were gone missing and later found to be murdered by unidentified serial killer. It takes place from 1996 to 2012. This represents a sad cycle of poor families raised in declining towns. Their poor choices and economic problems lead to child neglect, child abuse, behavior disorders, and drug habits. Those are the partial cause of prostitution today. In the book, the author focuses on this sensitive case, compiling all the known facts along with the biographies of the victims. On the other hand, the documentary film titled The Atomic Cafà © talks about misleading political propagandas and its consequences on the society. The film discusses the emergence of nuclear threats and the misinformation doled out to the public by the governmental authorities, with a view to manipulate the reality of the situ ation. This is an era rife with paranoia, anxiety and misapprehension, while the film also exhibits a genuine nostalgia for an earlier and more innocent nation. The footages used in the film clearly capture the effects of the political pressures of war as well as the impact resulting from these destructive weapons, since the World War II to the Cold War years. The callousness of the American authorities who were responsible for the atom bomb calamity is well portrayed in the film. The

Assignment 5 Essay Example | Topics and Well Written Essays - 1250 words

Assignment 5 - Essay Example They appear different from another angle as the question based on qualitative research design focuses on multiple realities that can be constructed from different sources, unlike the other question that targets valid statistics. The news outlet shares the results of a study where two groups of teenagers are measured against two variables; tendency to carry weapons and tendency to carry none based on the amount of soft drinks drunk. The study focuses on the effects of nutrition on behavior. The outlet points out that the study does not establish whether soft drinks cause violence. The news outlet does well to focus on the facts realized from the study. It interprets the information right without signs of the misconception. I am conducting a research to examine females’ attitude towards engineering and the popular stereotype that engineering is a male career. I am concerned about the career choices made by learners based on gender. I plan to conduct interviews that will involve teachers, students, parents and other members of the society. If you agree to participate, I will ask you to fill out a questionnaire form regarding your dream. Moreover, I would need to know why you chose such careers, how your cultures affect such choices and your opinion on who fits in engineering as a career. If you do not want to contribute, there will be no consequence involved and your results will not be pretentious. Participation is voluntarily. You can withdraw midway if you want to. Your inconspicuousness will be secured. The author is concerned with the need to enhance spelling in young elementary children. Spalding instruction is based on a language art strategy that has a number of positive outcomes for the elementary students. It does provide sequential, multisensory guidance in spelling phonics and handwriting. Learners can diligently put points across in

Value of Philosophy Essay Example for Free

Value of Philosophy Essay In the introductory lecture notes to this course I stated that we would start with a working definition of philosophy as being the â€Å"love of wisdom. † I have found, though, that just about every other definition attempted has many shortcomings. No one definition seems adequate to define what it means to engage in philosophy. Consequently, I think it is best to think of the philosopher in the somewhat imprecise term of a lover of wisdom. Someone who is continually in search of the truth. Though he/she might be ridiculed for pursuing the unobtainable, this search for truth/ knowledge can yield enormous benefits. It provides the tools to critically evaluate the world around us and the information we are given about that world. This ability to critically evaluate ideas is especially important given the role that such knowledge affects and shapes our lives—as we saw in the sections on B. F. Skinner, Positive Freedoms, and the Philosophy of Science. Furthermore, the changes in our society necessitate that we re-examine fundamental questions periodically. For example, advances in medical science have posed new ethical questions. Ethical judgments concerning genetic engineering (engineering certain characteristics into or out of our genetic make-up) calls into question fundamental ideas concerning freedom and individuality. Without some understanding of these subjects how can we frame answers to such questions? Even if we examine these questions, is our approach critical, authentic? Or do we choose to accept the answers given to us by society? Are we not then acting in a kind of Sartrean â€Å"Bad Faith? † How much of our humanity and freedom are we abdicating by not engaging in some kind of philosophical activity? Though we pride ourselves on being â€Å"rational† people, how rational are our thoughts and actions even if they are â€Å"proven? † Or, do we live up to Soren Kierkegaard’s remark in The Journals, â€Å"There are many people who reach their conclusion about life like schoolboys: they cheat their master by copying the answer out of a book without having worked the sum out for themselves. † Many of the great philosophers have attempted to justify and extol the virtues of the study of philosophy. I have put together a series of quotes of what I think are some of the more important passages addressing  philosophy’s role in education and our lives. As you read these quotes, consider whether or not philosophy practiced in this fashion and as it was studied throughout this course can actually lead one to be a lover of wisdom and help us—if not answer—at least understand some of the fundamental questions we have considered. Philosophy’s Role in Education Even the poor student studies and is taught only political economy, while that economy of living which is synonymous with philosophy is not even sincerely professed in our college. . . . Our inventions are wont to be pretty toys, which distract our attention from serious things. They are but improved means to an unimproved end, an end which it was already but too easy to arrive at . . .. While civilization has been improving our houses, it has not equally improved the men who are to inhabit them. It has created palaces, but it was not so easy to create noblemen and kings. Henry David Thoureau, Walden It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied. And if the fool, or the pig, are of a different opinion, it is because they only know their own side of the question. John Stuart Mill, â€Å"The Utilitarian Calculus of Pain and Pleasure† You want to know my attitude towards liberal studies. Well, I have no respect for any study whatsoever if its end is the making of money. Such studies are to me unworthy ones. They involve the putting out of skills to hire, and are only of value in so far as they may develop the mind without occupying it for long. Time should be spent on them only so long as ones mental abilities are not up to dealing with higher things. They are our apprenticeship, not our real work. Why liberal studies are so called is  obvious: it is because they are the ones considered worthy of a free man. . . . Why then do we give our sons a liberal education? Not because it can make them morally good but because it prepares the mind for the acquisition of moral values. Just as that grounding in grammar, as they called it in the old days, in which boys are given their elementary schooling, does not teach them the liberal arts but prepares the ground for knowledge of them in due course, so when it comes to character the liberal arts open the way to it rather than carry the personality all the way there . . .. Words need to be sown like seed. No matter how tiny a seed may be, when it lands in the right sort of ground it unfolds its strength and from being minute expands and grows to a massive size. Reason does the same; to the outward eye its dimensions may be insignificant, but with activity it starts developing. Although the words spoken are few, if the mind has taken them in as it should they gather strength and shoot upwards. Yes, precepts have the same features as seeds; they are of compact dimensions and they produce impressive resultsgiven, as I say, the right sort of mind, to grasp at and assimilate them. The mind will then respond by being in its turn creative and will produce a yield exceeding what was put into it. Seneca, Letters from a Stoic Philosophy and the Uncertainty of our Answers to Fundamental Questions The value of philosophy is, in fact, to be sought largely in its very uncertainty. The man who has not tincture of philosophy goes through life imprisoned in the prejudices derived from common sense, from the habitual beliefs of his age or his nation, from convictions which have grown up in his mind without the co-operation or consent of his deliberate reason. To such a man the world tends to become definite, finite, obvious, common objects rouse no questions, and unfamiliar possibilities are contemptuously rejected. As soon as we begin to philosophize, on the contrary, we find . . . that even the most everyday things lead to problems to which only very incomplete answers can be given. Philosophy, though unable to tell us with certainty what is the true answer to the doubts which it raises, is able to suggest many possibilities which enlarge our thoughts and free them from the tyranny of custom. Thus, while diminishing our feeling of certainty as to what things are, it greatly increases our knowledge as to what they may be; it removes the somewhat arrogant dogmatism of those who have never traveled into the region of liberating doubt, and it keeps alive our sense of wonder by showing familiar things in an unfamiliar aspect. Bertrand Russell, The Problems of Philosophy Philosophy, then, is not an empirical study: not the critical examination of what exists or has existed or will exist—this is dealt with by common-sense knowledge and belief, and the methods the natural sciences. Nor is it a kind of formal deduction, as mathematics or logic is. Its subject-matter is to a large degree not items of experience, but the ways in which they are viewed, the permanent or semi-permanent categories in terms of which experience is conceived or classified. . . . These models [categories] often collide; some are rendered inadequate by failing to account for too many aspects of experience, and are in their turn replaced by other models which emphasise what these last have omitted, but in their turn may obscure what the others have rendered clear. The task of philosophy, often a difficult and painful one, is to extricate and bring to light the hidden categories and models in terms of which human beings think (that is, their use of words, images an other symbols), to reveal what is obscure or contradictory in them, to discern the conflicts between them that prevent the construction of mare adequate ways of organizing and describing and explaining experience (for all description as well as explanation involves some model in terms of which the describing and explaining is done); and then, at a still ‘higher’ level, to examine the nature of this activity itself (epistemology, philosophical logic, linguistic analysis), and to bring to light the concealed models that operate in this second-order, philosophical, activity itself. . . . The perennial task of philosophers is to examine whatever seems insusceptible to the methods of he science or everyday observation, for  example, categories, concept, models, ways of thinking or acting, and particularly ways in which they clash with one another, with a view to constructing other, less internally contradictory and (though this can never be fully attained) less pervertible metaphors, images, symbols and systems of categories. it is certainly a reasonable hypothesis that one of the principle causes of confusion, misery and fear is, whatever may be its psychological or social roots, blind adherence to outworn notions, pathological suspicion of any form of critical self-examination, frantic efforts to prevent any degree of rational analysis of what we live by and for. Berlin, â€Å"The Purpose of Philosophy† Philosophy’s purpose is to illuminate the ways our soul has been infected by unsound beliefs, untrained tumultuous desires, and dubious life choices and preferences that are unworthy of us. Self-scrutiny applied with kindness is the main antidote. Besides rooting out the soul’s corruptions, the life of wisdom is also meant to stir us from our lassitude and move use in the direction of an energetic, cheerful life. Epictetus, The Art of Living, 84 Philosophy and the Enlightened Character Who can doubt . . . that life is the gift of the immortal gods, but that living well is the gift of philosophy? . . . They [the Gods] have given no one the present of a knowledge of philosophy, but everyone the means of acquiring it. For if they had made philosophy a blessing given to all and sundry, if we were born in a state of moral enlightenment, wisdom would have been deprived of the best thing about herthat she isnt one of the things which fortune either gives us or doesnt. As things are, there is about wisdom a nobility and magnificence in the fact that she doesnt just fall to a persons lot, that each man owes her to his own efforts, that one doesnt go to anyone other than oneself to find her. What would you have worth looking up to in philosophy if she were handed out free? Seneca, Letters from a Stoic Let no one put off studying philosophy when he is young, nor when old grow weary of its study. For no one is too young or too far past his prime to achieve the health of his soul. The man who alleges that he is not yet ready for philosophy or that the time for it has passed him by, is like the man who says that he is either too young or too old for happiness. Therefore, we should study philosophy both in youth and in old age, so that we, though growing old, may be young in blessings through the pleasant memory of what has been; and when young we may be old as well, because we harbor no fear over what lies ahead. We must, therefore, pursue the things that make for happiness, seeing that when happiness is present, we have everything; but when it is absent, we do everything to possess it. Epicurus, Letter to Menoeceus I tell you . . . let no day pass without discussing goodness and all the other subjects about which you hear me talking and examining both myself and other is really the very best thing that a man can do, and that life without this sort of examination is not worth living . . .. Plato, Socrates Defense (Apology). In other occupations, the reward comes with difficulty after their completion, but in philosophy delight coincides with knowledge. For enjoyment does not come after learning, but learning and enjoyment come together. Epicurus, Vatican Sayings Philosophy, likewise, tells all other occupations: Its not my intention to accept whatever time is left over from you; you shall have, instead, what I reject. Give your whole mind to her. Sit at her side and pay her constant court, and an enormous gap will widen between yourself and other men. Youll end up far in advance of all mankind, and not far behind the gods themselves. Seneca, Letters From A Stoic 3