Elizabeth Holmes has been named in the Time’s ‘100 most influential people of 2015’ and she has also been nominated as the World’s youngest female self-made billionaire of 2015. She’s being compared to the likes of Bill Gates and Steve Jobs. So, who is Elizabeth Holmes? What has she done to earn this privilege?

Elizabet Holmes is an American health technology entrepreneur. Her net worth is $4.6 billion. She dropped out of Stanford founded ‘Theranos’ in 2003 with the help of her tuition money.  Theranos is a Silicon Valley company that is working towards diagnostic tests using blood. Whenever you visit a doctor to get your glucose level checked or to check the functioning of certain organs, like liver and kidneys, a blood test is required. The blood test usually involves taking a blood sample through a needle . The blood results usually arrive from the lab after 2-3 days. But, Theranos has developed a novel blood testing method through which dozens of medical conditions can be diagnosed by drawing a few drops from the pinprick of the finger. Holmes claims that from that single sample several tests can be run. The results are faster, cheaper and more accurate than the standard method. For example, a standard lab test for cholesterol can cost fifty dollars or more; the Theranos test costs just two dollars and ninety-nine cents. . It is approximately 90% below the standard rates!! The reults of Theranos’s test will be available within hours.  The cost effectiveness of this method will make a huge difference in the lives of people. Elizabeth Holmes explained this with an example in an interview. She mentioned that standard fertility tests cost as much $2000 and some women can’t afford them but their new fertility tests will cost them $35. For conducting the blood test, Theranos has created tine tubes called ‘nanotainers’ which contain just a drop of blood and as many as 30 lab tests can be done from this tiny sample.

The tests are not available everywhere yet, but Holmes said they’re working as fast as they can to roll out in the next States. Theranos has entered into a partnership with with drugstore chain Walgreens to build thousands of Wellness Centers. Every center would offer a menu of blood tests , ranging from cancer to cholesterol, directly to consumers. It is also in discussions with Cleveland Clinic. The company has made claims that low-cost blood tests could save U.S. Medicare and Medicaid, on average, around $20 billion per annum. Her creation could transform the health industry not only in America, but round the World as well.

Click here for government certification in Health, Nutrition and Well-being

The post One woman’s initiative to transform health care appeared first on Vskills Blog.

A country can  economically progress only if the people living in that country are happy and satisfied with their lives. They will be able to concentrate on their work and put in their 100% only if their social and environmental needs are being provided upon. This is where ‘Social Progress Index’ (SPI) comes into play. It is a measure of the well-being of society. . The index is published by the nonprofit Social Progress Imperative. SPI is largely based on three broad dimensions. They are:

(i) Basic Human Needs
It is further classified into: (a) Nutrition and Basic Medical Care (b) Water and Sanitation (c) Shelter (d) Personal Safety
(ii) Foundations of Well-Being
It is categorized into: (a) Access to Basic Knowledge (b) Access to Information and Communications (c) Health and Wellness (d) Economic Sustainability
(iii) Opportunity
It is further classified into: (a) Personal Rights (b) Personal Freedom and Choice (c) Tolerance and Inclusion (c) Access to Advanced Education

According to the results of the Social Progress Index 2015, Norway, Sweden, Switzerland, Iceland and New Zealand are the top 5 countries in terms of social progress. India ranks 102nd on SPI. Economists measure the progress of a country through Gross Domestic Product (GDP). But, Michael Green, CEO of Social Progress Imperative differs from this notion. He points out that one shouldn’t judge a country by its GDP. As the findings of the SPI 2015 indicate, many resource-rich countries like Kuwait lag behind in SPI as compared to GDP. Some of the most interesting results to support this claim are that even though Norway(88.36) and New Zealand(87.08) have almost the same SPI, the GDP per capita of New Zealand is half of that of Norway. Ghana does better on SPI than Nigeria , even though it has lower GDP. Even USA is considered as an underachiever. Despite of the fact that it is considered as the superpower of the world, it rank 16th on SPI. Therfore, SPI is vital for the development of a nation as social, economic and environmental progress of a nation go hand-in-hand. Economic development of a country is necessary but we can’t base the progress and success of a particular country on that factor alone.

Click here for government certification in Accounting, Banking & Finance

The post The Rising Significance of Social Progress Index appeared first on Vskills Blog.

Rail Transport is Japan have become an essential part of Japanese culture. Majority of people in Japan rely on rail transport. Rail Transport in Japan is famous for its prowess in high speed train travel and its state-of-the-art trains. It was Japan who pioneered the high-speed bullet train. Japan’s high speed trains are one of the most advanced in the world , with trains running with minimal delays. An important aspect of rail transport in Japan is punctuality. People in Japan don’t expect trains to be late as little as 5 minutes.

Japan’s maglev train attained a speed of just over 603 km/h (373 mph) and managed nearly 11 seconds at600 km/h, thereby, setting up a world speed record on April 21,2015 in a test run near Mount Fuji.  It broke the 590 km/h mark it has set up last week in another test, breaking its own 2003 record of 581 km/h. The seven-car maglev train is short for “magnetic leviation “. Maglev trains use electrically charged magnets to lift and move carriages above the rail tracks. It hovers 10 centimeters above the tracks and is propelled by electrically charged magnets. The train travelled 1.8 km in under 11 seconds, Central Japan Railway said. About 200 train fanatics gathered along the route to witness the test run and cheered when the train crossed the 600 km/h mark.

The maglev train service is expected to go into operations by 2027 , between Tokyo and Nagoya, 286km away at a cost of about $100 billion. Nearly 80% of the route will run through tunnels. The train would run at a speed of 500 km/h and is expected to cover the distance between the two cities in 40 minutes , which is  nearly half of the present travel time.

The maglev trains begun as a project of Japan Airlines and the national railways with government support. Japan is hoping to sell its high speed train technology overseas in an attempt to increase its share in infrastructure exports. Prime Minister Shinzo Abe will be touting the technology in US  for a high-speed link between New York and Washington.

Click here for government certifications

The post Japan’s maglev breaks world speed record appeared first on Vskills Blog.

The debate on net neutrality has gained momentum on social media. It has become one of the most trending issues on facebook, twitter and other forms of social media. So, what is “Net Neutrality” and how will it change the way we use the internet? Net Neutrality is a principle which says that internet service providers (ISPs) should provide us with open networks and and should not discriminate against and charge all websites and users the same amount for internet service.  To put into simple terms, be it a Khan Academy video or a trailer of a bollywood movie, all data should be equal and an internet service providers  should not discriminate against it. ISPs cannot  decide what internet users can access or not. Some ISPs are also planning to charge users differently based on the medium the users are using. This is against the very concept of Net Neutrality. All websites must be accessible at the same speed.

Another aspect in Net Neutrality is that certain websites are willing to pay more money to ISPs so that the delivery of their services is faster and cheaper as compared to that of their competitors. An example of this is the Airtel Zero Platform. It is an open marketing platform where app makers can register to provide free services to their users. Flipkart supported it initially but due to a widespread outrage on the social media, pulled out of it. Experts believe that such platforms will create discrimination as start-ups won’t be able to compete with the large players as they won’t be able to afford paying the ISPs.

The argument that has been put forward by telecom companies and ISPs is that they built infrastructure and provide bandwidth to the data services like apps and website by investing large sums of money but are not able to make money off the apps and websites. Though, they make money through the data usage.  According to the companies,  OTT (over- the- top) services like WhatsApp , YouTube,etc. eat into their revenues . If companies have their way with TRAI (Telecom Regulatory Authority of India), users may end up paying more for the same amount of services. For example, if you pay Rs. 100 per month to your ISP for your internet and if net neutrality is scrapped off, then you may have to pay additional amount of money to access OTT services. Though, a Medianama report Mobile Internet in India rubbishes the claims made by the telecom companies. In the case of Airtel alone, while value-added service (VAS) revenue dipped from Rs 1024.85 crore on the third quarter of financial year 2013 to Rs 780.82 crore in the third quarter of financial year 2015, its data revenue jumped three-and-half times from Rs 585.75 crore to Rs 2,108.22 crore in the same period.

The debate against net neutrality is concerning since a large chunk of India’s population is now dependent on internet for a variety of purposes. Internet has become a basic utility if telecom companies have their way, it will adversely affect internet users in one way or other. A few months back, the American telecom regulator Federal Communications Commission ruled in favour of net neutrality. It’s high time that TRAI considers Internet service a utility and enforces net neutrality. It will enable a developing nation like India improved access to Internet.

What can you do as an Indian citizen?

TRAI is seeking the views of all stakeholders by 24^th April. As internet users, you can can send your comments to advqos@trai.gov.in to let the regulator know what is your stand on the issue. You can also log on to www.savetheinternet.in and send the responses to the 20 questions asked by TRAI. It is a 2-click process. Remember, the deadline to this process is 24^th April. The ease with which we access the Internet today will fly out the window if we don’t act quick.

Click here for government certification in Information Technology

The post Net Neutrality Debate : Is it an end to open internet? appeared first on Vskills Blog.

Ricardian Equivalence is an economic theory that states that when government tries to increase demand by increasing debt financed government spending , the demand remains unchanged. This happens because rational consumers recognize that present tax cuts  or higher spending by the government will lead to tax increases in future in order to pay off the debt. David Ricardo proposed this theory in the 19th century. However, Robert Barro extended this theory in the 20th century. Therefore, it is also known as “Barro-Ricardo equivalence proposition”.

The government can increase spending either through debt financing or tax financing. Debt financing happens when a firm or government raises money for working capital or capital expenditures by issuing bonds,notes,etc. to investors (institutional and/or individual). In debt financing, the investors becomes creditors and the firm or government becomes debtors. Tax financing is a public financing method that is used by government for redevelopment and improvement projects on existing structures. If the government follows the tax financing route, then the taxpayers fund the government activities and developmental projects. And, if the government follows the debt financing approach, and if the government does not defaults on the bonds it issues, then the interest on the government debt must be paid by the future taxpayers . Therefore, the rational consumers saves the extra income so that they can pay future tax rises. This theory suggests that if the consumers anticipate that there might be an increase in taxes in the future, they will save their current tax cuts in order to pay future tax rises.

Ricardian equivalence has been severely criticized by economists. There are various problems with it. It assumes that consumers are rational. Though consumers are not rational and many would not be able to anticipate that tax cuts will lead to tax rises in the future. Economists have also argued that Ricardian equivalence ignored economic and population growth.

Click here for government certification in Accounting, Banking & Finance

The post Ricardian Equivalence appeared first on Vskills Blog.

The term “Creative Destruction”  was coined by Joseph Schumpeter, an Austrian-American economist in his work “Capitalism, Socialism and Democracy”, first published in 1942. He derived it from the works of Karl Marx. Joseph Schumpeter popularized it as a theory of economic innovation and the business cycle. The term is also used in other areas like technology, marketing, product development,etc. He described creative destruction as the process that occurs when something new kills something older. According to Schumpeter, creative destruction describes the “process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one”. Schumpeter believed that the process of creative destruction is the essential fact about capitalism. It will lead to the eventual failure of capitalism as an economic system.

The effects of creative destruction are sometimes referred to as Schumpeter’s gale. Schumpeter believed that entrepreneurs set this process of creative disruption in motion.As these entrepreneurs create more advanced technology or more sophisticated organizational structures, they increase the efficiency of production. Creative Destruction is a common occurrence in industries, since, industries depend on innovation in order to be successful and be ahead of their competitors. Schumpeter observed that creative destruction resulted in many people losing their jobs, and hence ruined companies. Societies that allowed creative destruction to operate grew more richer and productive. Cost-cutting measures like downsizing and outsourcing are also considered as methods of creative destruction. The thought behind this is that though these measures will lead to reduction in the workforce but they will enable a transformation of the business.

A modern example of creative destruction is the way in which pen drives have replaced CDs . Pen drives are more convenient to carry around. Emergence of pen drives have decreased the economic value of CDs. A similar example is the replacement of floppy disks by CDs. CDs destroyed the floppy disk industry , but in doing so, entrepreneurs created one of the most important inventions of this century.

Click here for government certifications

Click here for government certification in Marketing

The post Creative Destruction appeared first on Vskills Blog.

Coase Theorem is a concept in law and economics which states that in the absence of transactions cost the level of production of goods and services in a trade in which there are externalities, bargaining between the parties will lead to an efficient outcome regardless of which party is ultimately awarded the property rights. An externality is the cost or benefit of an economic activity that is experienced by unrelated third parties. An externality can be either positive or negative. A very common example of negative externality is pollution emitted by a factory that harms the environment and the health of nearby residents. It was proposed by Nobel Prize laureate Ronald Coase in his 1960 paper “The Problem of Social Cost”.

Coase theorem helps in explaining the unprecedented cost advantage online firms will have in the digital marketplace over the traditional firms. The Coase Theorem can be explained through an example. Suppose a firm establishes a manufacturing unit near a river and instead of paying for waste removal, the firm dumps the waste into the river. As a result of this, the livelihood of fisherman will be adversely affected because the wastes will kill many of the river’s fish. In this case, the cheapest solution for the firm to eliminate water pollution will be to buy pollution control equipment and let’s say it costs Rs.5,000 per year. Water Pollution is a negative externality since the pollution negatively affects the livelihood of the fishermen.

Assume that a judge allows the firm to continue dumping , which lowers the fishermen’s profits by Rs.10,000 per year. Assume further that the firm will allow fishing in the lake as long as the fishing doesn’t affect the firm’s profits.In this case, the fishermen must decide what they want to do. The firm will continue to dump their waste in the lake. If the fishermen remain in the fishing market, they must decide whether it is better to continue losing Rs. 10,000per year or whether it is better to buy pollution control equipment themselves . Therefore, the fishermen will end up purchasing the pollution control equipment.Suppose instead that the judge actually granted the fishermen with the property rights to the lake.  Assuming that the firm decides to remain in the  market, they are faced with a choice between paying for pollution control of Rs. 5,000 per year and compensating the fishermen at Rs. 10,000 per year. Therefore, the firm will end up purchasing the pollution control equipment.Therefore, the allocation of property rights determines who is responsible for purchasing the pollution control equipment, the firm or the fishermen.

The post Coase Theorem appeared first on Vskills Blog.

According to Laffer Curve, as taxes increase from low levels the tax revenue collected by the government will also increase. After tax rate increases and reaches a certain level people will stop working hard as they used to and hence the revenue will decrease. Laffer explained it to the Ford administration in 1974. In  the above figure, beyond the point t* people will start working less because they will think of the increased tax rate as a penalty on their activities and hence, the tax revenue collected by the government will start to decline. t* represents the point at which maximum revenue is generated. Laffer curve suggests that lower tax rates have a positive impact on people as it provides incentives to increase their activities. t* need not be on 50% tax rate. It can be on any tax rate which is greater than 0% and less than 100%.

Basically tax rates have two effects on revenue. They are “arithmetic effect” and “economic effect”. The arithmetic effect assumes that tax revenue raised is equal to the tax rate multiplied by the revenue available for taxation (also known as tax base). If rates are lowered, the tax revenues  will be lowered by the amount of the decrease in the rate, and vice versa for increasing tax rates. For example, suppose at a tax rate of 3%, the revenue collected is Rs. 3 crore, then if the tax rate increases to 8%, then the revenue collected will also increase to Rs. 8 crore.Economic effect assumes that the tax rates will have an impact on the tax base itself. Therefore, they try to find a tax rate between 0% and 100% that will maximize the revenues. However, the Laffer Curve does not say that “all tax cuts pay for themselves” as many people claim. Tax rate cuts will always lead to more growth, employment, and income for citizens.

Click here for government certification in Accounting, Banking & Finance

The post Laffer Curve appeared first on Vskills Blog.

Information Asymmetry in economics indicates the situation in which one party in a transaction has more or better information than the other. It causes an imbalance in power and can lead to inefficiency in markets. It is a harmful situation in which one party can take the advantage of the lack of other party’s knowledge. The party who hasn’t access to the full information is at a disadvantage and will not be able to make a well thought out decision. It is the opposite of information symmetry. Examples of problems arising due to  information asymmetry are adverse selection, moral hazard and information monopoly.

Adverse Selection: In adverse selection, sellers have more information than buyers about crucial aspects like product quality. It leads to selection of bad products.  The most common example of adverse selection is the insurance industry. Life insurance applicants often withhold or provide false insurance to life insurance companies in order to obtain higher coverage at lower costs. Signaling games and screening games are often used to reduce adverse selection.

Moral Hazard : Moral hazard is the immoral behavior that occurs when one party gets involved in a risky situation being aware of the fact that it is insured against the risk and that the other party will bear the cost incurred due to the risk. An example of this situation is when you don’t install a fire alarm because you have fire insurance.

Information monopoly : Information monopoly occurs when the ruling class maintain their political power through their control of key communications information. Many experts consider the acquisition of Whatsapp by Facebook as a case of information monopoly. According to them, the main motive behind acquiring Whatsapp was not its revenue model but the fact that now Facebook will be able to link millions of people together and , hence make money from them

Click here for government certification in Accounting, Banking & Finance

The post Information Asymmetry appeared first on Vskills Blog.

Phillips Curve is an economic concept given by British economist  A.W. Phillips. According to this concept, inflation and unemployment have a inverse relationship. Decreased unemployment will lead to more wages paid to labour increase in that economy, which will lead to economic growth. This will result in higher levels of inflation. There is a short run tradeoff between unemployment and inflation, and this has not been observed in the long run. Phillips studied the wage inflation and unemployment rates of the British economy over the period of 1861-1957 and then plotted them on a scatter diagram.

The diagram represents the curve given by A.W. Phillips. The explanation behind the Phillips curve is that if there is a fiscal stimulus in the economy by the government, then there will be a increase in aggregate demand.  An increase in aggregate demand will also lead to an increase in the number of labours, therefore, there will be a decrease in the number of unemployed people. Now, the firms will have to compete for fewer workers by raising nominal wages. As a result, the wages will rise. The firms will pass on these rise in wages to the customers by increasing the prices of commodities, which is an increase in inflation.

Usually economists no longer use the Phillips curve because it is considered to be too simple and also it is not applicable in the long term. Now, modified forms of Phillips curve that take inflationary expectations into account are used.

Click here for government certification in Accounting, Banking & Finance

The post Phillips Curve appeared first on Vskills Blog.