Environmental Laws Research Paper Example | Topics and Well Written Essays - 1250 words

Environmental Laws - Research Paper Example National Environmental Policy Act was instituted by U.S. national policy to promote the enhancement of the environment. Furthermore, it established the Council on Environmental Quality (CEQ) of the president. National Environmental Policy Act (NEPA) Introduction The economic has a big role in determining how many and the type of environmental laws to be passed. Environmental law is a general term that describes international treaties, regulations, statues and national legislation or common law that works to regulate interaction of humanity and natural environment. This is mainly so as to reduce impacts of human activity. There are a number of laws that are created by economic conditions: National Environmental policy Act, oil pollution Act, Marine Mammal Protection Act, Fisheries Conservation and Management Act, Endangered Species Act, Food Quality Protection Act, Federal Food, Drug, and Cosmetic Act among others. The National Environmental Policy Act (NEPA) is one of United States e nvironmental law. It was established in 1970; moreover, it was the first statues of the environment belonging to the modern era. Furthermore, The National Environmental Policy Act was established by U.S. ... The most significant effect of NEPA was to establish procedural requirements for all federal government agencies to prepare environmental assessments and environmental impact statements . Furthermore, EAs and EISs include statements of the effects of the proposed federal agency actions to the environment. Moreover, procedural requirements of NEPA procedural apply to all federal agencies in the executive branch. However, NEPA does not apply to the President, to Congress, or to the federal courts. NEPA has three sections: the proclamation of national environmental goals and policies, the instituting of provisions that are action-forcing for federal agencies to ensure observation of those policies and goals and lastly, the establishment of a Council on Environmental Quality (CEQ) in the president’s Executive Office. Furthermore, The NEPA process comprises of an evaluation of applicable environmental effects of a federal project task, including a series of relevant alternatives. M oreover, the NEPA process begins with developing a proposal by an agency to address a need to take an action. Once a decision on whether or not the actions proposed is covered under NEPA is made. In addition, there are three analysis levels that a federal agency may accomplish to comply with the law (Stern, et al, 2009). These three levels include: Categorical Exclusion preparation, preparation of an Environmental Assessment and Finding of number Significant Impact; or drafting and preparation of an Environmental Impact Statement. 3 Furthermore, a major federal action has been increased in scope to include most things that a federal agency could regulate or prohibit. Moreover, in practice, a project is expected to meet guidelines of NEPA when a federal agency gives any part of the financing

A Credit Default Swap (CDS) Coursework Example | Topics and Well Written Essays - 2250 words

A Credit Default Swap (CDS) - Coursework Example The creditor must make periodical payments (which are taken to be insurance premium) to the insurer, and the insurer will pay the creditor in case the there is default. The fixed periodical payments made by the creditor or the buyer of a Credit Default Swap are known as the CDS fee or commonly referred to as CDS spreads. The buyer of the Credit Default Swap can only receive the exact value of the credit or loan and can not be compensated beyond that value. The seller of the Credit Default Swap (or the insurer) takes possession of the defaulted credit or loan, obtains right of ownership and can therefore sue to recover the credit. The value of the spreads to be paid should be determined so that the buyer of the Credit Default Swap can pay the correct value for the Credit Default Swap. Consider an example where a buyer of Credit Default Swap enters a five year contract to pay CDS spreads on Ford Motors credit with a principal of $10 million at 300 basis points. This means that the buye r pays $300,000 per year and obtains the right to sell bonds worth $10 million issued by Ford of that value in the event of a default by Ford. This thesis is divided into three parts which cover the topic in Credit Default Swap spreads in details. ... Bonds with AAA rating are considered to have almost no chance of default and its CDS spreads are expected to be lower compared to D rating which have a very high risk of default and its CDS spreads expected to be far more expensive. Probability Model There are other quantitative methods that can be employed to determine CDS spread to be paid. The probability model is one of the quantitative methods. This method recommends that credit default swaps should trade at a significantly lower spread than company bonds. The price of a Credit Default Swap is determined using a representation that considers four factors which are; issue premium, recovery rate (which is the percentage repaid in the event of default), credit curve and LIBOR curve. The price of a Credit Default Swap would be determined by adding the discounted premium payments. To explain the probability method better, imagine a case of one year Credit Default Swap which will be effective on lets say date t with a quarterly spread payment taking place on dates t1, t2, t3 and t4. If the nominal for the Credit Default Swap is N and the issue premium is C, then the value of the periodical spreads is given by the formula NC/4. If we imagine the default can only happen on one of the payment dates, then the swap agreement can end when; it lacks a default within agreed time and so the spread payments are made and the agreement endures until maturity date or, a default takes place either on first, second, third or fourth compensation date. The price of the Credit Default Swap is now determined by assigning probabilities to the five probable results. Labor Rate Labor rate can also be employed to benchmark the price for Credit Default Swap securities of a listed company. Labor is the interest fee which