# Understanding Financial Management and Securities Markets

## Trends in Financial Management and Securities Markets

1. What are the current developments in financial management and the securities markets?
Many of the key trends shaping the practice of financial management echo those in other disciplines. For example, technology is improving the efficiency with which financial managers run their operations. In the wake of a slowing economy and corporate scandals, the SEC assumed a stronger role and implemented additional regulations to protect investors from fraud and misinformation. A wave of merger mania hit the global securities markets as the securities exchanges themselves have begun to consolidate to capture larger shares of the world’s trading volume in multiple types of securities. Online brokerage firms are seeking new ways to capture and keep their customers by broadening the services they offer and keeping the fees they charge highly competitive. Let’s now look at two key trends in greater detail. In the era of the Sarbanes-Oxley Act, CFOs find themselves balancing a strategic focus with overseeing corporate compliance with the act. The NYSE and NASDAQ are battling for supremacy as the regional exchanges look for niche markets to exploit.

### Finance Looks Outward

No longer does finance operate in its own little world of spreadsheets and banking relationships. Most CFOs want the finance function to be viewed by their company’s business units as a strategic partner who can contribute to their success. Finance professionals therefore need a broad view of company operations to communicate effectively with business unit managers, board members, creditors, and investors. The goal is productive cooperation and teamwork between finance and the business units to meet corporate objectives. CFOs are more highly visible and active in company management than ever before. They serve as both business partner to the chief executive and a fiduciary to the board.
In the aftermath of recent accounting scandals and the global recession of 2008–2009, CFOs consider accuracy of financial reporting their top priority, and they also must now provide more detailed explanations of what’s behind the numbers to board members and other stakeholders. Rather than showering the board with financial reports and statistics, CFOs are crafting more focused presentations that deal with the company’s overall financial health and future prospects. They must also educate board members about the implications of Sarbanes-Oxley and other legislation, such as Dodd-Frank, and what the company is doing to comply with federal regulations.

### Vying for the Crown

The NYSE and NASDAQ continue to wage a heated battle for supremacy in the global securities markets. The NYSE fell behind its more nimble rival, which already had an electronic platform. Its answer was to make sweeping changes in its organizational structure by going public and merging with Archipelago, a major ECN, to enter the electronic marketplace. NASDAQ responded immediately by acquiring another ECN, Instinet’s INET. The NYSE then made history by signing an agreement to merge with Euronext and create the first exchange to span the Atlantic. Not to be outdone, the NASDAQ increased its ownership of shares in the London Stock Exchange to 25 percent. These transactions reduced the fragmentation in the marketplace and also eliminated many of the differences between the two exchanges.
But the competition between the two companies continued in 2017, as the London Stock Exchange looks for a buyer after the European Commission refused to allow a merger between LSE and Germany’s Deutsche Borse. It remains to be seen whether either U.S. exchange is ready to purchase an international exchange; however, their recent strategic moves have made them stronger and more competitive.

### Summary of Learning Outcomes

1. What are the current developments in financial management and the securities markets?
The role of the CFO has continued to expand since the passage of the Sarbanes-Oxley Act, with CFOs taking the central role in overseeing corporate compliance with the act and reestablishing public trust. CFOs must look outward and be business focused. Most CFOs are promoting strategic finance and encouraging finance staff to be team players who work closely with business units to achieve corporate goals.
Competition among the world’s major securities exchanges has changed the composition of the financial marketplace. The NYSE and NASDAQ went head to head in the United States. The NYSE became a for-profit company, acquired Archipelago, an electronic exchange, and merged with Euronext to form the first transatlantic exchange. NASDAQ also expanded by acquiring its own ECN and buying a 25 percent stake in the London Stock Exchange, which continues to look for a potential buyer.

### Preparing for Tomorrow’s Workplace Skills

1. The head of your school’s finance department has asked you to address a group of incoming business students about the importance of finance to their overall business education. Develop an outline with the key points you would cover in your speech. (Information)
2. You are the chief financial officer of Discovery Labs, a privately held biotechnology company that needs to raise $3 million to fund the development of a new drug. Prepare a report for the board of directors that discusses the types of long-term financing available to the firm, their pros and cons, and the key factors to consider in choosing a financing strategy. (Information)
3. Team Activity Does paying dividends enhance the value of a company? Some financial experts caution companies to look long and hard before beginning to pay dividends. They believe that committing yourself to a regular dividend curtails financial flexibility and reduces debt capacity. Dividends might also signal that the company doesn’t have good growth opportunities in which to invest its excess cash. Others counter that dividends can help a company’s stock by making it less volatile. Standard & Poor’s data supports this; typically, dividend-paying stocks in the S&P 500 outperform nonpayers. Divide the class into two teams to debate whether dividends add value to a company’s stock. (Interpersonal, Information)
4. Research the trends in the IPO marketplace from 2009 to 2017. Then select two IPO success stories and two failures. Prepare a report for the class on their performance. What lessons about the securities markets can you learn from their stories? (Information)
5. While having dinner at a Manhattan restaurant, you overhear two investment bankers at the next table. They are discussing the takeover of Bellamco Industries by Gildmart Corp., a deal that has not yet been announced. You have been thinking about buying Bellamco stock for a while, so the next day you buy 500 shares for $30 each. Two weeks later, Gildmart announces its acquisition of Bellamco at a price of $45 per share. Have you fairly earned a profit, or are you guilty of insider trading? What’s wrong with insider trading? (Information)
6. Team Activity Is joining an investment club a good way to learn about investing in the stock market? Divide the class into groups of five to eight students to develop a strategy to form their own investment club. Use the National Association of Investors Corporation (NAIC) website at http://www.betterinvesting.org to learn how investment clubs operate and the investment strategy the organization teaches. Each group should then set up guidelines for their investment club and present their plan to the class. After the presentations, the class members should discuss whether they would prefer to start investing through an investment club or on their own. (Resources, Interpersonal, Information)

### Ethics Activity

In late July 2017, senior management at Equifax, a U.S. credit-reporting company, discovered that hackers had stolen the personal data of more than 145 million U.S. customers, including names, birthdates, Social Security numbers, and driver’s license information. In addition, the hackers stole credit card information for more than 200,000 Equifax customers.
If that weren’t bad enough, reports soon surfaced that three top executives, including Equifax’s chief financial officer, sold close to $2 million in shares of company stock days after learning about the breach and more than a month before the company announced the data hack publicly. In a company statement, Equifax says the executives “had no knowledge that an intrusion had occurred at the time they sold their shares.” The day after the company’s announcement about the breach, Equifax’s stock dropped by double digits, and the Department of Justice opened a criminal investigation.
Less than three weeks after the public announcement, Equifax announced its CEO, Richard Smith, would retire, taking a multimillion-dollar payout with him—even after shareholders lost more than $5 billion in stock value after the data breach was acknowledged.
Ethical Dilemma: Is it legal for company executives to sell stock shares for financial gain when they know impending bad news will cause the stock price to plummet? Does this constitute insider trading?
Sources: Verne Kopytoff, “Equifax Board Reviews Executive Stock Sales after Data Breach,” Fortune, http://fortune.com, September 29, 2017; Jen Wieczner, “Equifax CEO Richard Smith Who Oversaw Breach to Collect $90 Million,” Fortune, http://www.fortune.com, September 26, 2017; Tom Schoenberg, Anders Melin, and Matt Robinson, “Equifax Stock Sales Are the Focus of U.S. Criminal Probe,” Bloomberg Markets, https://www.bloomberg.com, September 18, 2017; Liz Moyer, “Suspect Trading in Equifax Options before Breach Might Have Generated Millions in Profit,” CNBC, https://www.cnbc.com, September 8, 2017; Alina Selyukh, “3 Equifax Executives Sold Stock Days after Hack That Wasn’t Disclosed for a Month,” NPR, http://www.npr.org, September 8, 2017; Anders Melin, “Three Equifax Managers Sold Stock Before Cyber Hack Revealed,” Bloomberg News, https://www.bloomberg.com, September 7, 2017.

### Working the Net

1. If factoring accounts receivable is still a mystery to you, visit the 21st Financial Solutions site, http://www.21stfinancialsolutions.com. Follow the links on the home page to answer these questions: What are factoring’s advantages? What are the additional benefits, and what types of companies can use factoring to their advantage? Then summarize the factoring process.
2. Go to the AdvisoryHQ website at https://www.advisoryhq.com, and link to three different venture capital firms listed in the website’s “best” list. Compare the firms’ investment strategies (industry specialization, age of companies in which they invest, etc.). Also do a web search to check out two angel investor firms. How do their requirements differ from the venture firms?
3. Compare the listing requirements of the NYSE and NASDAQ, using the information at their websites: http://www.nyse.com and http://www.nasdaq.com. Search the sites for listing requirements. What types of companies qualify for listing on each exchange? Why does NASDAQ offer alternative listing standards?
4. Choose a company currently traded on the NYSE (http://www.nyse.com). Find the company’s website using a search engine such as Google. At the website, find the firm’s investor relations information. Review the information, including, if available, the most recent online annual report. Follow up by researching if any SEC actions have been taken against the firm at the SEC website, http://www.sec.gov. Summarize your findings in a brief report that discusses whether you would recommend this company’s stock as an investment.
5. Using the information and links available at the Securities Industry and Financial Markets Association’s (SIFMA) website, https://www.sifma.org, write a brief paper explaining the pros and cons of investing in corporate bonds. In your paper, provide at least three examples of currently available corporate bonds from a site such as http://www.investinginbonds.com, and explain why they would be good investments.
6. Research the job responsibilities of a corporate investor relations officer (IRO). If possible, try to interview an IRO, by either phone or email. The National Investor Relations Institute (http://www.niri.org), a trade association for IROs, is an alternate source of information. What types of experience and education does an IRO need in order to perform effectively? How are their roles changing? Write a paper summarizing your findings. (Interpersonal, Information)

### Creative Thinking Case

### Blue Apron IPO Leaves a Bad Taste

Founded in 2012, Blue Apron is one of the top meal-kit delivery services doing business in the United States. Started by three cofounders—Matt Salzberg, Matt Wadiak, and Ilia Pappas—Blue Apron provides preportioned ingredients (and recipes) for a meal, delivered to consumers’ front doors.
According to recent research, the U.S. meal-kit delivery industry is an $800 million business with the potential to scale up quickly, as more and more consumers struggle to find time to go grocery shopping, make meals, and spend time with family and friends in their hectic daily lives.
As word spread among foodies about the quality and innovative meals put together by Blue Apron, the company’s popularity took off, supported by millions in start-up funding. Costs to scale the business have not been cheap—estimates suggest that Blue Apron’s marketing costs have been high.
Despite the challenges, by early 2017 the company was selling more than 8 million meal kits a month and decided to go public in an effort to raise more money and scale its operations, including a new fulfillment facility in New Jersey. According to IPO paperwork filed with the SEC, the company had net revenues of $84 million in 2014, which increased to $795 million in 2016. However, those ambitious numbers were not without warnings: company losses increased in the same time period from $33 million to $55 million.
Even with those larges losses on its balance sheet, Blue Apron decided to go ahead with the IPO and hired Goldman Sachs and Morgan Stanley, two top stock underwriters, to figure out the right price for the initial offering. While Blue Apron and its underwriters were finalizing stock prices, Amazon announced plans to acquire Whole Foods—a move that could negatively affect Blue Apron’s business going forward.
Even after Amazon’s announcement, Blue Apron and its financial advisors priced the initial offering at $15 to $17 a share and met with investors across the country to inform them about the IPO, which would value the company on paper at more than $3 billion. As part of the IPO strategy, Blue Apron executives needed to communicate a strong financial picture while providing potential investors with an honest assessment of investor demand, especially for institutional investors, who typically are repeat buyers when it comes to IPOs.
According to sources close to the IPO experience, Blue Apron’s bankers told investors late in the IPO pricing process that they were “closing their order books early,” which meant there was a heightened demand for the stock—a signal that the stock would be priced in the original $15–$17 range.
A day later, however, Blue Apron amended its prospectus with a price range between $10 and $11 a share, which shocked potential investors—a move greeted with criticism that Blue Apron’s messaging now lacked credibility in the eyes of the investment community if the company priced the IPO $5 lower per share than originally estimated. With that sudden change in the IPO offering, investors walked away, and the $10 initial offering for Blue Apron stock actually declined on its first day of trading. As of this writing, the stock has lost close to 40 percent from the original $10-per-share price.
With continued consolidation in the meal-kit delivery sector inevitable, Blue Apron is at a crossroads when it comes to generating revenue and stabilizing costs while trying to sign up more subscribers. One of its competitors, Plated, was recently acquired by the Alberstons grocery chain, and Amazon has already trademarked the phrase, “We do the prep. You be the chef,” as it relates to prepared food kits.
Sources: Wolf Richter, “Blue Apron’s Cash Burn Is a Threat Just 3 Months after Its IPO,” Business Insider, http://www.businessinsider.com, October 19, 2017; Graham Rapier, “Blue Apron CEO: Amazon and Whole Foods Aren’t the Competition,” Business Insider, http://markets.businessinsider.com, September 13, 2017; Matthew Lynley, “Where Does Blue Apron Go after Amazon Wraps Up Its Whole Foods Deal?” Tech Crunch, https://techcrunch.com, August 27, 2017; Leslie Picker, “Inside Blue Apron’s IPO: Communication Lapse Chased Away Investors,” CNBC, https://www.cnbc.com, August 23, 2017; Imani Moise, “Blue Apron Co-Founder to Step Aside as Operating Chief,” The Wall Street Journal, https://www.wsj.com, July 25, 2017; Phil Lempert, “Understanding Blue Apron’s IPO and the Future of Meal Kits,” Forbes, http://www.forbes.com, June 2, 2017; John Kell, “Meals in the Mail: How Blue Apron Got Started and Where It’s Heading,” Fortune, http://fortune.com, September 11, 2016.
2. What issues should executives of a company such as Blue Apron consider before deciding to go public? In your opinion, was the company ready for an IPO? Why or why not?
3. How else could Blue Apron have raised funds to continue to grow? Compare the risks of raising private funding to going public.
4. Use a search engine and a site such as Yahoo! Finance to learn about Blue Apron’s current situation. Prepare a brief summary, including the company’s current financial situation. Is it still a public company, and how has its stock fared? Would you invest in it? Explain your reasoning.
Sources: Wolf Richter, “Blue Apron’s Cash Burn Is a Threat Just 3 Months after Its IPO,” Business Insider, http://www.businessinsider.com, October 19, 2017; Graham Rapier, “Blue Apron CEO: Amazon and Whole Foods Aren’t the Competition,” Business Insider, http://markets.businessinsider.com, September 13, 2017; Matthew Lynley, “Where Does Blue Apron Go after Amazon Wraps Up Its Whole Foods Deal?” Tech Crunch, https://techcrunch.com, August 27, 2017; Leslie Picker, “Inside Blue Apron’s IPO: Communication Lapse Chased Away Investors,” CNBC, https://www.cnbc.com, August 23, 2017; Imani Moise, “Blue Apron Co-Founder to Step Aside as Operating Chief,” The Wall Street Journal, https://www.wsj.com, July 25, 2017; Phil Lempert, “Understanding Blue Apron’s IPO and the Future of Meal Kits,” Forbes, http://www.forbes.com, June 2, 2017; John Kell, “Meals in the Mail: How Blue Apron Got Started and Where It’s Heading,” Fortune, http://fortune.com, September 11, 2016.

### Hot Links Address Book

1. What challenges do today’s financial managers face? To find out, browse through recent issues of CFO magazine at http://www.cfo.com
2. Find an introduction to the types of cash management services banks offer their customers at the Royal Bank of Canada website, https://rbcbank.com
3. Start your online exploring at Yahoo! Finance, http://finance.yahoo.com, which offers everything from breaking business and world news to stock research, portfolio tracking tools, and educational articles.
4. For small businesses just starting out or entrepreneurs who have invented the next great product but need some financial assistance, several crowdfunding platforms can help. Both Kiva (https://www.kiva.org) and IndieGoGo (https://www.indiegogo.com) offer loans or financial backing to help people start up new businesses or match potential investors with entrepreneurs looking for some financial backing.
5. The Motley Fool, http://www.fool.com, is a favorite site for both novice and experienced investors. In addition to the latest stock picks, the website offers detailed information on a variety of topics, such as how to invest, retirement, and personal finance.
6. You’ll find a minicourse on municipal bonds when you click on “Learn More” at the top of the page at http://www.investingbonds.com.
7. Moneychimp (http://www.moneychimp.com) strives to educate investors by offering clear, practical articles on a complete range of finance and investing topics, including investment basics, understanding annual reports, stock valuation, and more.
8. Thinking of investing in a particular company? Go to the SEC’s website to access the EDGAR database of the financial reports filed by all public companies with the SEC: http://www.sec.gov.


# Your Career in Business

## Introduction

### Learning Outcomes

After reading this chapter, you should be able to answer these questions:
1. How can you enhance your interpersonal skills?
2. Why is learning to plan so important in school and in the real world?
3. What skills should you develop in school that can transfer easily to your professional life and make it a success?
4. What are some strategies that will help you find, keep, and advance in your dream job?
5. What key attributes do employers look for when interviewing job candidates?
You Are a Winner Because You Elected to Go to College!
Never Quit Until You Have Your Degree in Hand!
What makes someone a winner in life? A winner is someone who goes through the various stages of life satisfied in knowing that they have done their best: their best at work, home, and in all pursuits of life. A big part of having a happy life is pursuing a career that offers job satisfaction and financial rewards. If you are going to “be all that you can be,” you need a good education.
A college degree unlocks doors to economic opportunity.
Why get a degree?
1. Get and keep a better job. Because the world is changing rapidly and many jobs rely on new technology, more jobs require education beyond high school. With a college education, you will have more jobs from which to choose.
2. Earn more money. People who go to college usually earn more than those who do not. Currently, a bachelor’s degree is worth a minimum of $20,000 a year more than a high school diploma. If your career spans 45 years, you could earn close to $1 million more than a high school graduate.
3. Get a good start in life. A business college education helps you acquire a wide range of knowledge in many subjects as well as an advanced understanding of your specialized area of business. College also trains you to express your thoughts clearly in speech and in writing and to make informed decisions.
Simply stated, a degree in business gives you the chance to achieve the quality of life you deserve. The lifestyle, the new friends, the purchasing power of a degree won’t guarantee happiness but will put you well on the road to finding it.


# Your Career in Business

## Learn the Basics of Business

You might want to pursue a career as a physician, florist, game warden, systems analyst, or any of a thousand other opportunities. One thing that all careers have in common is that you need to have a basic understanding of business. We hope that you will consider a career in business, but if not, your success in whatever you choose will partially depend on your basic business skills. And that is why this text is so important.

### Choose a Career

Because this introductory business course gives you a detailed overview of all of the areas of commerce, it will guide you in selecting a major should you elect to get a degree in business. Choosing a major in college is one of life’s true milestones. Your major essentially determines how you will spend the next four decades of your life. A marketing major will find a career in sales, marketing research, advertising, or other marketing-related fields. An accounting major will become (you guessed it) an accountant. Never take selecting a major lightly. If you work 40 hours a week for the next 45 years (less vacations), you will put in about 90,000 hours on the job. Don’t you think you should choose something that you will enjoy?


# Your Career in Business

## Developing Interpersonal Skills Is Key to Your Success

A degree in business is going to offer you many great career opportunities. Once you take your first job, how rapidly you move up the ladder is up to you. People with great interpersonal skills will always do better on and off the job than those who lack them. It has been estimated that up to 90 percent of our workplace success depends on an understanding of other people. Here’s how to enhance your interpersonal skills:
1.
Become a good listener. When you listen well, you are in effect telling the other person that they are worth listening to. Listening well includes listening to both what is said and what is not said. Learn to read unspoken gestures and expressions. When giving feedback, plan what you will say in advance. Be positive and specific. Ask the person receiving the feedback if they would like to discuss your comments further.
2.
Persuasion rests on trust. You can build trust by being honest, fulfilling your commitments, being concerned about others, and minimizing problems and pain for others whenever possible. In short, if you have integrity, building trust becomes a simple task.
When people raise objections to your plans or ideas, try to fully understand their comments and the motivation for making them. When you feel that you understand the true objection, answer the objection in the form of a benefit: “Yes, you will need to work next Saturday, but then you can have compensatory time off anytime you wish next month.” Determine your persuasion skills by taking the quiz in
3.

It will not happen overnight, but you can become an outstanding thinker and speaker. A simple technique is to set a timer for two minutes and ask a friend to begin speaking. When the timer goes off, your friend stops speaking, and you begin talking. The challenge is to use the final thought that your friend spoke as the first word of your two-minute talk. Another technique is to have someone supply you with a series of quotes. Then, without hesitation, give your interpretation.
4.
If you want to gain empowerment in your life and work, here are a few tips: be assertive, ask for credit for yourself when it is due, propose ideas to your group and your supervisor, initiate projects without being asked, tie your personal goals to those of the organization, develop your leadership skills, plan to learn on a continuous basis, be informed, don’t let others intimidate you, and don’t complain about a bad situation—instead, take action to improve it.
5.
Here are some tips and techniques to be an effective player in the political game:

Find out how well you play the political game by taking the quiz in
6.

7.
When conflicts occur, try the K-I-N-D technique. The letters stand for:

The technique involves your requesting a meeting with the difficult person, whether they are is having a conflict with you or with others. Start off with kind words, words that encourage cooperation, words that show your determination to make the conflict situation better. Next, demonstrate that you have taken the time to learn more about the person, what is important to them, what they prefers in terms of work. Show by your words that you have taken the time to become informed about the individual.
The third step requires you to do something novel, something you have not tried before. Put your creativity to work, and discover a plan to which you can both subscribe (for example, keeping a journal regarding the problem and possible solutions).
Finally, do not permit the exchange to conclude until you have made a definite overture to ensure future success. What can you promise the other person you will do differently? What are you asking him or her to do differently? Set a time to meet again and review your individual attempts to achieve collective improvement.


# Your Career in Business

## Make Your Future Happen: Learn to Plan

There is a natural conflict between planning and being impulsive, between pursuing a long-range goal and doing what you feel like doing right now. If you have ever had to study while the rest of the family was watching television, you know what that conflict feels like. If you have ever been invited to go eat pizza and hang out with friends but stayed home to work on a class assignment, you know that sticking to a plan is not easy.
Of course, planning and being impulsive are both good. They both have a place in your life. You need to balance them. Having a plan does not mean that you can’t act on the spur of the moment and do something that was not planned. Spontaneous events produce some of the happiest, most meaningful times of your life. Problems arise when you consistently substitute impulsive actions for goal-oriented planning. Success in life requires a balance between the two.
If you do not engage in long-range planning and lack the discipline for it, you may limit your opportunities to be impulsive. You are not going to take a weekend fun trip just because you need a break if you have not saved the money to do it. In the short run, planning involves sacrifice, but in the long run, it gives you more options.

### What Is a Plan?

A plan is a method or process worked out in advance that leads to the achievement of some goal. A plan is systematic, which means it relies on using a step-by-step procedure. A plan also needs to be flexible so that it may be adapted to gradual changes in your goal.

### The Planning Process

Whether choosing a college or finding financial aid, you should understand how the planning process helps you accomplish your goals. The following steps outline the planning process.
Step 1: Set a Goal. Identify something you want to achieve or obtain, your goal. The goal, which is usually longer term in nature, will require planning, patience, and discipline to achieve. Just living in the present moment is not a goal.
Step 2: Acquire Knowledge. Gain an understanding of your goal and what will be required to achieve it. Gather information about your goal through research, conversation, and thought.
Step 3: Compare Alternatives. Weigh your options, which are the different paths you might take to achieve your goal. Analyze the pluses and minuses of each—the costs, the demands, the likelihood of success.
Step 4: Choose a Strategy. Select one option as the best plan of action. The choice is based on sound information, the experience of others, and your own interests and abilities.
Step 5: Make a Commitment. Resolve to proceed step-by-step toward achieving your goal. Keep your eyes on the prize.
Step 6: Stay Flexible. Evaluate your progress, and when necessary, revise your plan to deal with changing circumstances and new opportunities.

### An Example of Planning

The following example illustrates the process of buying a new pair of wireless headphones using this planning process.
Step 1: Set a Goal. Purchase a pair of wireless headphones.
Step 2: Acquire Knowledge. Ask friends if you can try out their headphones. Study standards and specifications. Check on retailers, brands, models, and prices. Consult Consumer Reports.
Step 3: Compare Alternatives.
1. Alternative 1: Purchase a pair of headphones from an online auction website such as eBay.

2. Alternative 2: Buy wireless headphones for $110.

3. Alternative 3: Buy a high-quality pair of headphones for $500.

Step 4: Choose a Strategy. Decide to buy the high-quality headphones, but rather than using a credit card and paying interest, will delay the purchase for six months in order to save for them.
Step 5: Make a Commitment. Give up going to the movies or buying coffee drinks from Starbucks for the six-month period, carry a lunch and stop eating out, and place the savings in a designated headphones fund.
Step 6: Stay Flexible. Four months into the plan, a model change sale provides an opportunity to buy comparable equipment for $300. Make the purchase, paying cash.

### Planning for Your Life

Using the planning process to make a buying decision is a simple exercise. Making a decision about major parts of your life is far more complex. You will see that no part of life is exempt from the need for planning. It is important to apply thought, creativity, and discipline to all the interrelated phases of our lives. These phases include the following:
1. Career: Choosing a field of work and developing the knowledge and skills needed to enter and move ahead in that field. We will offer you some tips to get started on a great career later in this chapter.
2. Self: Deciding who you are and what kind of person you want to be, working to develop your strengths and overcome your weaknesses, refining your values.
3. Lifestyle: Expressing yourself in the nature and quality of your everyday life, your recreation and hobbies, how you use your time and money.
4. Relationships: Developing friendships and learning to get along with people in a variety of contexts. Building family and community ties.
5. Finances: Building the financial resources and the economic security needed to pursue all the other dimensions of your life.

### Dreams and Plans

People are natural dreamers. Dreams give us pleasure. They are also part of making a future. If you do not have dreams or think that you are not worthy of dreaming, something very important may be missing from your life. You have a right to your dreams, and you need them—even if there is little possibility that they will ever come true.
Planning is not the same as dreaming, but it uses dreams as raw materials. It translates them into specific goals. It tests them. It lays out a course of action that moves you toward realizing these goals and sets up milestones you need to achieve. Planning brings dreams down to earth and turns them into something real and attainable. For example, assume you have a dream to visit Spain as an exchange student. To translate this dream into a specific goal, you will need to follow the planning process—gather information about the exchange process, discuss the program with parents and teachers, and improve your Spanish-language skills.

### Directions for Your Life

One of the best things about pursuing our dreams is that, even when you fall short, the effort leads to growth and opens a path to other opportunities. The person who practices the piano every day may not achieve the dream of becoming a concert pianist but may eventually put appreciation of music to work as the director of an arts organization. A basketball player may not make it to a professional team but may enjoy a satisfying career as a coach or a sports writer. Without a plan, dreams simply dissolve. With a plan, they give shape and direction to our lives.
Planning involves a lot of thinking and finding answers to lots of questions. The answers and even the plan will change over time as you gain more knowledge and life experience. Planning is a skill that is useful in every area of your life. It is something you have to pursue consciously and thoughtfully. When you plan, you translate your goals and dreams into step-by-step strategies, specific things you can do to test your goals and bring them to reality. You often have to revise your plans, but even when your plans are not fulfilled, planning will have a positive effect on the course of your life.


# Your Career in Business

## Going to College Is an Opportunity of a Lifetime—Never Drop Out

You have already had one of your dreams come true—you are in college. It is indeed a rare privilege because far less than 1 percent of traditional college-age people around the world get to attend college. You’re lucky! So make the best of it by finishing your degree and learning the following college skills.

### Learn to Concentrate

Concentration is the art of being focused, the ability to pay attention. Without concentration, you have no memory of what you hear, see, and read. Concentration is a frame of mind that enables you to stay centered on the activity or work you are doing. You know when you’re concentrating because time seems to go by quickly, distractions that normally take you off task don’t bother you, and you have a lot of mental or physical energy for the task.
You are ultimately in charge of how well you concentrate. Here are some ways to make it happen:
1. Choose a workplace. Avoid the bed—you associate it with relaxing or sleeping. Try a desk or table for studying; you will concentrate better and accomplish more in less time. You will also have a convenient writing space and plenty of space to spread out. Be sure to have good lighting.
2. Feed your body right. What you eat plays an important role in how well or how poorly you concentrate. Protein foods (such as cheese, meat, fish, and vegetables) keep the mind alert, while carbohydrates (such as pasta, bread, and processed sugars) make you sleepy. Caffeine (commonly found in coffee, tea, soft drinks, and chocolate) acts as a stimulant in low doses.
3. Avoid food. Food and serious learning don’t mix well. Think about it. When you try to eat and study at the same time, which gets more of your concentration? The food, of course. You will be more effective if you eat first and then study.
4. Listen to your own thoughts. Listening to anything but your own thoughts interferes with good concentration. Eliminating distractions such as music, television, cell phones, email and text beeps, and other people can greatly increase the amount of studying you can accomplish. Hold all calls, and let email and texts wait.
5. Make a to-do list. If you are trying to study but get distracted by all of the things you need to do, take time to make a to-do list. Keeping track of your thoughts on paper and referring to the paper from time to time can be very effective for clearing your mind and focusing on your task.
6. Take short, frequent breaks. Since people concentrate for about 20 minutes or less at a time, it would make sense to capitalize on your natural body rhythms and take a short break every 20 to 30 minutes. If you feel you are fully concentrating and involved in a task, then work until a natural break occurs.

### Learn to Manage Your Time

There are two ways to make sure you have more time in a day. The first and most important way to gain more time is to plan it. It’s like getting in a car and going somewhere. You need to know where you are going and have a plan to get there. Without a plan, you will waste your time and take longer to get to your destination—if you get there at all!
A weekly project planner will allow you to keep track of your assignments in more detail. It contains a to-do list specific to one day. It looks like a calendar but is divided into five one-day periods with plenty of space to write. Using a weekly project planner is an effective way to keep track of assignments and plan study time according to the school calendar. Free calendars are available at https://calendar.google.com.
A second way to gain more time in a day is to do more in less time. This can be as simple as doubling up on activities. For example, if you have three errands, you might try to combine them instead of doing one at a time, making one round-trip instead of three. If you commute on a bus, on a train, or in a carpool, you can study during your ride. At lunch, you can review notes. Use your imagination as to how you can get more done in less time.
Here are some ideas to help you master your time:
1. Prepare for the morning the night before. Put out your clothes; make lunches; pack your books.
2. Get up 15 minutes earlier in the morning. Use the time to plan your day, review your assignments, or catch up on the news.
3. Schedule a realistic day. Avoid planning for every minute. Leave extra time in your day for getting to appointments and studying.
4. Leave room in your day for the unexpected. This will allow you to do what you need to do, regardless of what happens. If the unexpected never happens, you will have more time for yourself.
5. Do one thing at a time. If you try to do two things at once, you become inefficient. Concentrate on the here and now.
6. Learn to say “No.” Say no to social activities or invitations when you don’t have the time or energy.
How well do you manage your time? Take the quiz in  to find out.

### Use Your Money Wisely

You can get college money from several different sources, including the following.
1. Grants and Scholarships. This refers to aid you do not have to repay. Grants are usually based on need while scholarships are frequently based on academic merit or other qualifying factors.
2. Educational Loans. These are usually subsidized by federal and state governments, private lenders, or the colleges themselves. Generally, the loans carry lower interest rates than commercial loans, and you do not have to pay them off until after graduation.
3. Work Aid. This is financial aid you have to work for, frequently 10 or 15 hours a week on campus.
There are many ways to cut the cost of going to college. Consider these:
1. Going to a community college for the first two years and then transferring to a four-year institution
2. Attending a nearby college and living at home
3. Enrolling in one of thousands of college and universities with cooperative educational programs that alternate between full-time studies and full-time employment
4. Taking a full-time job at a company that offers free educational opportunities as an employee benefit
To learn about college costs and financial aid, one of the first sources to consult is the website of The College Board, a not-for-profit organization that connects students to college success and opportunity. Some of the important topics covered at www.collegeboard.org include explaining financial aid, facilitating the application process, and finding colleges that fit. There are other websites that also offer information on financial aid:
1. http://www.fastweb.com: Fastweb has a database of more than 1.5 million private-sector scholarships, grants, and loans.
2. http://www.ed.gov: This is the U.S. Department of Education information site for federal aid programs, including student loans and grants.
Gain some insight into your money management skills by taking the quiz in

### Study Well

The first key to doing well in a subject is to complete your assignments on time. Most instructors base their assignments on what they will be discussing in class on a given day. So, if you read the pages you are assigned for the day they are due, you will better understand the day’s lecture. If you don’t complete an assignment when it is due, not only will you be at a disadvantage in the class, but you will also have twice as much work to do for the following class.
Second, know what material to study. This may sound simple, but all too often students do not ask what material they should study and find out too late that they studied the wrong information. The easiest and most accurate way to learn what will be covered on a test is to ask your instructor or read the syllabus.
Tests measure your working memory and knowledge base. To help yourself remember, you can use several memory devices to recall the information you need to study. Here are a few memory devices that have been proven to work:
1.
2.
3.
The first letters of these words are: M V E M J S U N .
An acronym using these letters would be difficult to remember. But if you create a sentence using the letters in order, you will remember the sequence better. For example:
4.
 helps you evaluate your study skills.

### Become a Master at Taking Tests

Taking a formal test is like playing a game. The object is to get as many points as possible in the time you are allowed. Tests are evaluations of what you know and what you can do with what you know. Here are the rules of the test-taking game:
1. Rule 1: Act As If You Will Succeed. Thought is powerful. When you think negative thoughts, your stress level rises. Your confidence level may drop, which often leads to feelings of failure. When this happens, think about success. Smile and take deep, slow breaths. Close your eyes, and imagine getting the test back with a good grade written at the top.
1. Rule 2: Arrive Ahead of Time. Being on time or early for a test sets your mind at ease. You will have a better chance of getting your favorite seat, relaxing, and preparing yourself mentally for the game ahead.
2. Rule 3: Bring the Essential Testing Tools. Don’t forget to bring the necessary testing tools along with you, including extra pens, sharpened pencils, erasers, a calculator, laptop, dictionary, and other items you may need.
3. Rule 4: Ignore Panic Pushers. Some people become nervous before a test and hit the panic button, afraid they don’t know the material. Panic pushers are people who ask you questions about the material they are about to be tested on. If you know the answers, you will feel confident; however, if you don’t, you may panic and lose your confidence. Instead of talking with a panic pusher before a test, spend your time concentrating on what you know, not on what you don’t know.
4. Rule 5: Preview the Playing Field. Here’s how to do a preview:

5. Rule 6: Write in the Margin. Before you begin the test, write key terms, formulas, names, dates, and other information in the margin so you won’t forget them.
6. Rule 7: Complete the Easy Questions First. Answering easy questions first helps build your confidence. If you come across a tough question, mark it so you can come back to it later. Avoid spending so much time on a challenging question that you might run out of time to answer the questions you do know.
7. Rule 8: Know If There Is a Guessing Penalty. Chances are your tests will carry no penalty for guessing. If your time is about to run out and there is no penalty, take a wild guess. On the other hand, if your test carries a penalty for guessing, choose your answers wisely, and leave blank the answers you do not know.
8. Rule 9: Avoid Changing Your Answers. Have you ever chosen an answer, changed it, and learned later that your first choice was correct? Research indicates that three out of four times, your first choice is correct; therefore, you should avoid changing an answer unless you are absolutely sure the answer is wrong.
9. Rule 10: Write Clearly and Neatly. If you are handwriting your test (versus using a computer), imagine your instructor reading your writing. Is it easy to read or difficult? The easier your test is for the instructor to read, the better your chances of getting a higher grade.
Here are some websites to help you learn more about taking tests:
1.

2.

3.

4.


# Your Career in Business

## Get Your Career Off on the Right Track

Mark this section of the text with a permanent bookmark because you are going to want to refer back to it many times during the remainder of your college career. Yes, we are going to give you a road map to find, keep, and advance in that job that is perfect for you.

### Think Positively

To be successful in life and in a career, you need to be positive. Positive thinking is making a conscious effort to think with an optimistic attitude and to anticipate positive outcomes. Positive behavior means purposely acting with energy and enthusiasm. When you think and behave positively, you guide your mind toward your goals and generate matching mental and physical energy.
Positive thinking and behavior are often deciding factors in landing top jobs: your first job, a promotion, a change of jobs—whatever career step you are targeting. That’s because the subconscious is literal; it accepts what you regard as fact. Follow these steps to form the habit of positive thinking and to boost your success:
1. Deliberately motivate yourself every day. Think of yourself as successful, and expect positive outcomes for everything you attempt.
2. Project energy and enthusiasm. Employers hire people who project positive energy and enthusiasm. Develop the habit of speaking, moving, and acting with these qualities.
3. Practice this positive-expectation mindset until it becomes a habit. Applicants who project enthusiasm and positive behavior generate a positive chemistry that rubs off. Hiring decisions are influenced largely by this positive energy. The habit will help you reach your peak potential.
4. Dwell on past successes. Focusing on past successes to remind yourself of your abilities helps in attaining goals. For example, no one is ever born knowing how to ride a bicycle or how to use a computer software program. Through training, practice, and trial and error, you master new abilities. During the trial-and-error phases of development, remind yourself of past successes; look at mistakes as part of the natural learning curve. Continue until you achieve the result you want, and remind yourself that you have succeeded in the past and can do so again. You fail only when you quit trying!

### Take a Good Look at Yourself

Once you’ve developed a positive, “can do” attitude, the next step is to better understand yourself. Ask yourself two basic questions: “Who am I?” and “What can I do?”
Who Am I? This question is the start of self-assessment, examining your likes and dislikes and basic values. You may want to ask yourself the following questions:
1. Do I want to help society?
2. Do I want to help make the world a better place?
3. Do I want to help other people directly?
4. Is it important for me to be seen as part of a big corporation? Or do I prefer to be part of a smaller organization?
5. Do I prefer working indoors or outdoors?
6. Do I like to meet new people, or do I want to work alone?
Are you assertive? Assess your assertiveness by taking the quiz in
What Can I Do? After determining what your values are, take the second step in career planning by asking, “What can I do?” This question is the start of skill assessment, evaluating your key abilities and characteristics for dealing successfully with problems, tasks, and interactions with other people. Many skills—for instance, the ability to speak clearly and strongly—are valuable in many occupations.
Be sure to consider the work experience you already have, including part-time jobs while going to school, summer jobs, volunteer jobs, and internships. These jobs teach you skills and make you more attractive to potential employers. It’s never too early or too late to take a part-time job in your chosen field. For instance, someone with an interest in accounting would do well to try a part-time job with a CPA (certified public accountant) firm.
In addition to examining your job-related skills, you should also look at your leisure activities. Some possible questions: Am I good at golf? Do I enjoy sailing? Tennis? Racquetball? In some businesses, transactions are made during leisure hours. In that case, being able to play a skillful, or at least adequate, game of golf or tennis may be an asset.
It’s hard to like your job if you don’t like the field that you’re in. Most career counselors agree that finding work you’re passionate about is one of the critical factors behind career success. That’s why so many career counselors love all those diagnostic tools that measure your personality traits, skill levels, professional interests, and job potential.
The internet is virtually exploding with tests and assessments that you can take. Try, for example, http://www.self-directed-search.com. This test is based on the theory that people and work environments can be classified into six basic types: realistic, investigative, artistic, social, enterprising, and conventional. The test determines which three types best describe you, and it suggests occupations that could be a good match. The Keirsey Character Sorter (http://www.keirsey.com) is a first cousin of Myers-Briggs. It sorts people into four temperaments: idealists, rationals, artisans, and guardians. Like Myers-Briggs, it not only places you in an overall category, but it also offers a more detailed evaluation of your personality traits. To find a bunch of tests in one place, use a search engine and search “online personality tests.”

### Understand What Employers Want

Employers want to hire people who will make their businesses more successful. The most desirable employees have the specific skills, transferable career competencies, work values, and personal qualities necessary to be successful in the employers’ organizations. The more clearly you convey your skills as they relate to your job target, the greater your chance of landing your ideal job.
Job-Specific Skills. Employers seek job-specific skills (skills and technical abilities that relate specifically to a particular job). Two examples of job-specific skills are using specialized tools and equipment and using a custom-designed software program.
Transferable Skills and Attitudes. Change is a constant in today’s business world. Strong transferable career skills are the keys to success in managing your career through change. The most influential skills and attitudes are the abilities to:
1. Work well with people.
2. Plan and manage multiple tasks.
3. Maintain a positive attitude.
4. Show enthusiasm.
Employers need workers who have transferable career competencies—basic skills and attitudes that are important for all types of work. These skills make you highly marketable because they’re needed for a wide variety of jobs and can be transferred from one task, job, or workplace to another. Examples include these:
1. Planning skills
2. Research skills
3. Communication skills
4. Human relations and interpersonal skills
5. Critical thinking skills
6. Management skills
7. Project management skills
Take, for example, a construction supervisor and an accountant. Both must work well with others, manage time and specific tasks, solve problems, read, and communicate effectively—all transferable competencies. They both must be competent in these areas even though framing a house and balancing a set of financial information (the job-specific skill for each field, respectively) are not related. In every occupation, transferable competencies are as important as technical expertise and job-specific skills.

### Find Your First Professional Job

The next step is landing the job that fits your skills and desires. You need to consider not only a general type of work but also your lifestyle and leisure goals. If you like to be outdoors most of the time, you might be very unhappy spending eight hours a day in an office. Someone who likes living in small towns may dislike working at the headquarters of a big corporation in Los Angeles, New York City, or Chicago. But make sure that your geographic preferences are realistic. Some parts of the country will experience much greater growth in jobs than others in the coming years.
According to recent research by Glassdoor, the online job listings and career site, the top 10 best cities for jobs in 2017 are:
1. Pittsburgh, PA
2. Indianapolis, IN
3. Kansas City, MO
4. Raleigh-Durham, NC
5. St. Louis, MO
6. Memphis, TN
7. Columbus, OH
8. Cincinnati, OH
9. Cleveland, OH
10. Louisville, KY
You might start answering the question “What will I do?” by studying the Occupational Outlook Handbook, published every two years by the U.S. Department of Labor (https://www.bls.gov/ooh). The most recent Handbook edition projects job opportunities by industry through the year 2026. The Handbook is divided into 25 occupational clusters describing 325 job profiles (with a section on military careers). Among the clusters are education, sales and marketing, transportation, health, and social services. Each job description tells about the nature of the work, working conditions, required training, other qualifications, chances for advancement, employment outlook, earnings, related occupations, and sources of more information. Another good source of job information is the website for the National Association of Colleges and Employers (http://www.naceweb.org). If you are a member of a minority group, you might want to check out https://www.blackcareernetwork.com or http://www.saludos.com.

### Use the Internet to Find a Job

Today, most job searches are done online. Rarely do job seekers use “snail mail” to send a résumé to a potential employer. Therefore, you need to do your homework when it comes to creating a résumé and posting it to various websites, as well as sending it electronically to a specific company’s careers web page.
Let’s start with the résumé. There are thousands of job-related sites and millions of résumés on the internet. To break through the clutter, you must start with a great résumé—a written description of your education, work experience, personal data, and interests. There are plenty of online resources that can provide you with tips and actual templates to use when creating your résumé. For example, CollegeGrad (https://collegegrad.com) provides more than 100 preformatted templates for over 30 college majors on its website that you can use to tailor your résumé and highlight your specific skills and talents. Of course, there are many other sources for creating a résumé, including the actual websites of most online job-listing services.
Once you have created an electronic résumé, you have several options when it comes to your job search. First, you can target specific companies where you would like to work. Then go to their corporate websites and look for a careers page on the website. For example, Google has an extensive careers section on its website that provides detailed information on how to apply to become a “Googler,” along with a section on what the company’s interview process entails and how Google makes hiring decisions.
You can also try posting your résumé on the top 10 most popular job websites. They are so large that they are worth checking out first. They tend to have more jobs listed, represent more companies, and have larger résumé databases, which attract even more companies.
1. Indeed (https://www.indeed.com)
2. Monster (https://www.monster.com)
3. Glassdoor (https://www.glassdoor.com)
4. CareerBuilder (https://www.careerbuilder.com)
5. SimplyHired (https://www.simplyhired.com)
6. JobDiagnosis (https://www.jobdiagnosis.com)
7. Nexxt (https://www.nexxt.com)
8. ZipRecruiter (https://www.ziprecruiter.com)
9. USAJobs (https://www.usajobs.gov)

### The Multimedia Résumé

If you are going to become a computer programmer, web developer, graphics designer, artist, sculptor, singer, dancer, actor, model, animator, cartoonist, or anyone who would benefit by the photographs, graphics, animation, sound, color, or movement inherent in a multimedia résumé, then this résumé is for you. For most people, however, a multimedia résumé and personal home page on the internet aren’t necessary. Most internet service providers and commercial online services provide some space on their sites for subscriber home pages.

### Getting Your Electronic Résumé into the Short Pile

Applicant tracking systems (ATSs) screen for keywords, which either reject your résumé or move it on to the short list. Your task is to use keywords that will produce as many “hits” as possible. Keywords tend to be more of the noun or noun phrase type (Total Quality Management, Walmart, Sales Manager) as opposed to power action verbs often found in traditional résumés (developed, coordinated, organized). Every occupation and career field has its own jargon, acronyms, and buzzwords. There are also general keywords that apply to transferable skills important in many jobs, such as teamwork, writing, and planning.
Use these tips for adding effective keywords to your résumé:
1. The best source of keywords is the actual job listing, which is likely to contain many, if not all, of the keywords that an employer will use to search the résumé database.
2. Include plenty of keyword nouns and noun phrases throughout your résumé. If you have a “Summary of Qualifications” section at the beginning of your résumé, try not to repeat verbatim the contents of this section.
3. If you are applying for technical positions, you can list your skills, separating each noun or phrase by a comma.
4. In some fields, a simple list of skills does not sufficiently describe the job seeker’s background. Where appropriate, include accomplishments, as well, but be sure to include enough keywords to satisfy the ATS searches.
There are several ways to determine what keywords are appropriate for your industry and job.
1. Look through recent job postings online. Certain words will reappear consistently. Those are your “key” words.
2. Make sure your résumé contains the keywords and concepts used in the particular job listing you are applying to.
3. Talk to people in the career field you are targeting, and ask them what keywords are appropriate to the positions you are applying to.
4. Research specific company websites that appeal to you in terms of getting a job with that specific organization, and review the “About Us” section. Try to use some of the key words the company uses to describe its corporate environment as part of your résumé descriptions.
5. Visit professional association websites, and read the content carefully. Many of these are loaded with industry-related jargon that may be appropriate for your résumé.
If you are still in college, try to get at least one internship in the career field you’re targeting. Even if your internship lasts only a few weeks, you will significantly increase your keyword count to build a resume, not to mention gain valuable experience that will get the attention of hiring professionals.

### I’ve Landed a Job Interview

If some of the companies you contacted want to speak with you, your résumé achieved its goal of getting you a job interview. Look at the interview as a chance to describe your knowledge and skills and interpret them in terms of the employer’s specific needs. To make this kind of presentation, you need to do some research on the company. A great place to start is the company’s own corporate website.
As you do your information search, you should build your knowledge in these three areas:
1. General Information about the Occupational Field. Learn about the current and predicted industry trends, general educational requirements, job descriptions, growth outlook, and salary ranges in the industry.
2. Information about Prospective Employers. Learn whether the organization is publicly or privately owned. Verify company names, addresses, products, or services (current and predicted, as well as trends); history; culture; reputation; performance; divisions and subsidiaries; locations (U.S. and global); predicted growth indicators; number of employees; company philosophies and procedures; predicted job openings; salary ranges; and listings of managers of your targeted department within the organization. Also learn about the competitors and customers.
3. Information about Specific Jobs. Obtain job descriptions; identify the required education and experience; and determine prevalent working conditions, salary, and fringe benefits.

### Interview Like a Pro

An interview tends to have three parts: icebreaking (about five minutes), in which the interviewer tries to put the applicant at ease; questioning (directly or indirectly) by the interviewer; and questioning by the applicant. Almost every recruiter you meet will be trying to rate you in 5 to 10 areas. The questions will be designed to assess your skills and personality.
Many firms start with a screening interview, a rather short interview (about 30 minutes) to decide whether to invite you back for a second interview. Sometimes screening interviews can take place online via Skype, FaceTime, or some other form of videoconferencing. Only about 20 percent of job applicants are invited back. The second interview is usually a half day or a day of meetings set up by the human resource department with managers in different departments. After the meetings, someone from the human resource department will discuss other application materials with you and tell you when a letter of acceptance or rejection is likely to be sent. (The wait may be weeks or even months.) Many applicants send follow-up letters in the meantime to show they are still interested in the firm.
For the interview, you should dress conservatively. Plan to arrive about 10 to 15 minutes ahead of time. Try to relax. Smile and make eye contact with (but do not stare at) the interviewer. Body language is an important communicator. The placement of your hands and feet and your overall posture say a good deal about you. Here are some other tips for interviewing like a pro:
1. Concentrate on being likable. As simplistic as it seems, research proves that one of the most essential goals in successful interviewing is to be liked by the interviewer. Interviewers want to hire pleasant people others will like working with on a daily basis. Pay attention to the following areas to project that you are highly likable:

2. Project an air of confidence and pride. Act as though you want and deserve the job, not as though you are desperate.
3. Demonstrate enthusiasm. The applicant’s level of enthusiasm often influences employers as much as any other interviewing factor. The applicant who demonstrates little enthusiasm for a job will never be selected for the position.
4. Demonstrate knowledge of and interest in the employer. “I really want this job” is not convincing enough. Explain why you want the position and how the position fits your career plans. You can cite opportunities that may be unique to a firm or emphasize your skills and education that are highly relevant to the position.
5. State your name and the position you’re seeking. When you enter the interviewer’s office, begin with a friendly greeting and state the position you’re interviewing for: “Hello, Ms. Levine, I’m Bella Reyna. I’m here to interview for the accounting position.” If someone has already introduced you to the interviewer, simply say, “Good morning, Ms. Levine.” Identifying the position is important because interviewers often interview for many different positions.
6. Focus on how you fit the job. Near the beginning of your interview, as soon as it seems appropriate, ask a question similar to this: “Could you describe the scope of the job and tell me what capabilities are most important in filling the position?” The interviewer’s response will help you focus on emphasizing your qualifications that best match the needs of the employer.
7. Speak correctly. Grammatical errors can cost applicants the job. Use correct grammar, word choice, and a businesslike vocabulary, not an informal, chatty one. Avoid slang. When under stress, people often use pet phrases (such as you know) too often. This is highly annoying and projects immaturity and insecurity. Don’t use just or only. “I just worked as a waiter.” Don’t say “I guess.” Avoid the word probably because it suggests unnecessary doubt. Ask a friend or family member to help you identify any speech weaknesses you have. Begin eliminating these speech habits now.
Also, you should avoid the following “disqualifiers” at all costs. Any one of these blunders could cost you your dream job:
1. Don’t sit down until the interviewer invites you to; waiting is courteous.
2. Don’t bring anyone else to the interview; it makes you look immature and insecure.
3. Don’t smoke or bring a beverage with you.
4. Don’t put anything on or read anything on the interviewer’s desk; it’s considered an invasion of personal space.
5. Don’t chew gum or have anything else in your mouth; this projects immaturity.
6. If you are invited to a business meal, don’t order alcohol. When ordering, choose food that’s easy to eat while carrying on a conversation.
7. Don’t offer a limp handshake; it projects weakness. Use a firm handshake.

### Select the Right Job for You

Hard work and a little luck may pay off with multiple job offers. Your happy dilemma is deciding which one is best for you. Start by considering the “FACTS”:
1. Fit: Do the job and the employer fit your skills, interests, and lifestyle?
2. Advancement and growth: Will you have the chance to develop your talents and move up within the organization?
3. Compensation: Is the employer offering a competitive salary and benefits package?
4. Training: Will the employer provide you with the tools needed to be successful on the job?
5. Site: Is the job location a good match for your lifestyle and your budget?
A great way to evaluate a new location is through Homefair (http://www.homefair.com). This site offers tools to help you calculate the cost of moving, the cost of living, and the quality of life in various places. The Moving Calculator helps you figure out how much it will cost to ship your worldly possessions to a particular city. The Relocation Crime Lab compares crime rates in various locations. The City Snapshots feature compares demographic, economic, and climate information for two cities of your choosing. The Salary Calculator computes cost-of-living differences between hundreds of U.S. and international cities and tells you how much you’d need to make in your new city to maintain your current standard of living.

### Start Your New Job

No time is more crucial, and possibly nerve-racking, than the first few months at a new job. During this breaking-in period, the employer decides whether a new employee is valuable enough to keep and, if so, in what capacity. Sometimes the employee’s whole future with the company rides on the efforts of the first few weeks or months. Most firms offer some sort of formal orientation. But generally speaking, they expect employees to learn quickly—and often on their own. You will be expected to become familiar with the firm’s goals; its organization, including your place in the company; and basic personnel policies, such as coffee breaks, overtime, and parking.
Here are a few tips on making your first job rewarding and productive:
1. Listen and learn: When you first walk into your new job, let your eyes and ears take everything in. Do people refer to one another by first names, or is the company more formal? How do people dress? Do the people you work with drop into one another’s open offices for informal chats about business matters? Or have you entered a “memo mill,” where anything of substance is put on email and talks with other employees are scheduled through their administrative assistants? Size up where the power lies. Who seems to most often assume a leadership role? Who is the person others turn to for advice? Why has that person achieved that position? What traits have made this person a “political leader”? Don’t be misled by what others say, but also don’t dismiss their evaluations. Make your own judgments based on what you see and hear. Effective listening skills help you learn your new job responsibilities quickly. Take the quiz in  to see if you are a good listener.
2. Do unto others: Be nice. Nice people are usually the last to be fired and among the first to be promoted. Don’t be pleasant only with those who can help you in the company. Be nice to everyone. You never know who can help you or give you information that will turn out to be useful. Genuinely nice people make routine job assignments, and especially pressure-filled ones, more pleasant. And people who are dealt with pleasantly usually respond in kind.
3. Don’t start out as a maverick: If every new employee tried to change tried-and-true methods to suit his or her whims, the firm would quickly be in chaos. Individual needs must take a back seat to established procedures. Devote yourself to getting things done within the system. Every manager realizes that it takes time for a new person to adjust. But the faster you start accomplishing things, the faster the boss will decide that you were the right person to hire.
4. Find a great mentor: The leading cause of career unhappiness is working for a bad boss. Good jobs can easily be ruined by supervisors who hold you back. In contrast, your career will soar (and you will smile every day) when you have a great mentor helping you along the way. If you find a job with a super mentor, jump at the chance to take it.

### Moving Up

Once you have been on the job for a while, you will want to get ahead and be promoted.  offers several suggestions for improving your chances of promotion. The first item might seem a bit strange, yet it’s there for a practical reason. If you don’t really like what you do, you won’t be committed enough to compete with those who do. The passionate people are the ones who go the extra mile, do the extra work, and come up with fresh out-of-the-box ideas.
So there you have it. Remember: it’s never too early to begin planning your career—the future is now.


# Your Career in Business

## Self-Test Scoring Guidelines

After you answer the questions in each of the fun self-tests that appear in this chapter, determine your score and evaluate your skills using the following scoring guidelines.
Table 1 Fun Self-Test: Can You Persuade Others?
For questions 1, 2, 4, 8, 10, and 11, use the following to calculate your score:
For questions 3, 5, 6, 7, and 9 use the following to calculate your score:
If your score is between 40 and 55, you have an excellent ability to persuade others. A score between 30 and 39 means you have reasonably good persuasion skills. However, you may need to improve your listening and communicating skills. A score below 30 means that you should consider reading a book or taking a short course on how to persuade others.
Table 2 Fun Self-Test: Are You Good at Office Politics?
For questions 1, 3, 4, 7, 8, 10, 12, and 13, give yourself 1 point if you said “true.” For questions 2, 5, 6, 9, and 11, give yourself 1 point if you said “false.” If your score is 9 or below, you may be good at managing your work, but you need to improve your political skills. Being political means getting along with others in order to move them toward accomplishing a specific goal. If your score is low, consider reviewing the tips offered in the chapter on how to be an effective political player.
Table 4 Fun Self-Test: How Well Do You Manage Your Time?
For questions 2, 6, 8, 9, 11, 13, 14, and 15, use the following to calculate your score:
For questions 1, 3, 4, 5, 7, 10, and 12, use the following to calculate your score:
If your score is 60 or higher, you have excellent time management skills. Congratulations—you use your time well! If your score is below 60, consider reading a book on time management, taking a course on time management, or investing in time-management tools such as a weekly project planner. The chapter has additional tips that may be useful in improving your time-management skills.
Table 5 Fun Self-Test: Are You Good at Managing Money?
For questions 2, 3, 5, 6, 10, and 11, use the following to calculate your score:
For questions 1, 4, 7, 8, and 9, use the following to calculate your score:
If your score is 44 or higher, you are able to manage money while balancing your expenses and income. You will be ready to handle financial emergencies without turning to friends or relatives. If your score is between 36 and 43, your savings habits may be inconsistent. To achieve better savings, control your expenses and avoid unnecessary purchases. If your score is 35 or below, you spend too much! Remember: it’s a lot more painful to earn money than to spend it. You need to gain control of your finances by limiting your spending, paying off credit cards, or investing in a good personal finance book or course. You may also need to meet with a financial advisor to seek direction on your spending and saving habits.
Table 6 Fun Self-Test: Do You Have Good Study Habits?
If you answered “yes” to questions 3, 5, 7, 8, and 11, give yourself 1 point for each answer.
If you answered “no” to questions 1, 2, 4, 6, 9, 10, and 12, give yourself 1 point for each answer.
If your score is 10 or above, congratulations! You have good study habits. If your score is below 10, read the tips offered in the chapter on improving your study skills. You may also meet with someone at your school to help maximize your study time.
Table 7 Fun Self-Test: How Assertive Are You?
For questions 1, 3, 4, 7, 9, and 13, use the following to calculate your score:
For questions 2, 5, 6, 8, 10, 11, and 12, use the following to calculate your score:
If your score is 44 or higher, you stand up for your rights while showing respect for others. You quickly respond to unfair criticism. You should be able to fare well in office politics. If your score is 43 or lower, you may want to consider ways to become more comfortable communicating your ideas and opinions and managing your relationships with others.
Table 8 Fun Self-Test: Are You a Good Listener?
For questions 3, 4, 8, and 9, use the following to calculate your score:
For questions 1, 2, 5, 6, 7, and 10, use the following to calculate your score:
Listening is an important communication skill that will help you succeed in your career. By becoming an effective listener, you gain respect from your colleagues, pick up insights and ideas on improving your job performance, and develop a skill that is important in managing others. If you have a score of 32 or above, then you are a good listener. If your score falls below 32, you need to improve your listening skills. Search the internet for articles and ideas on becoming a better listener, and begin practicing your new skills with your friends and coworkers.


# Science and the Universe: A Brief Tour

## Introduction

We invite you to come along on a series of voyages to explore the universe as astronomers understand it today. Beyond Earth are vast and magnificent realms full of objects that have no counterpart on our home planet. Nevertheless, we hope to show you that the evolution of the universe has been directly responsible for your presence on Earth today.
Along your journey, you will encounter:
1. a canyon system so large that, on Earth, it would stretch from Los Angeles to Washington, DC ().
1. a crater and other evidence on Earth that tell us that the dinosaurs (and many other creatures) died because of a cosmic collision.
2. a tiny moon whose gravity is so weak that one good throw from its surface could put a baseball into orbit.
3. a collapsed star so dense that to duplicate its interior we would have to squeeze every human being on Earth into a single raindrop.
4. exploding stars whose violent end could wipe clean all of the life-forms on a planet orbiting a neighboring star ().
5. a “cannibal galaxy” that has already consumed a number of its smaller galaxy neighbors and is not yet finished finding new victims.
6. a radio echo that is the faint but unmistakable signal of the creation event for our universe.
Such discoveries are what make astronomy such an exciting field for scientists and many others—but you will explore much more than just the objects in our universe and the latest discoveries about them. We will pay equal attention to the process by which we have come to understand the realms beyond Earth and the tools we use to increase that understanding.
We gather information about the cosmos from the messages the universe sends our way. Because the stars are the fundamental building blocks of the universe, decoding the message of starlight has been a central challenge and triumph of modern astronomy. By the time you have finished reading this text, you will know a bit about how to read that message and how to understand what it is telling us.


# Science and the Universe: A Brief Tour

## The Nature of Astronomy

Astronomy is defined as the study of the objects that lie beyond our planet Earth and the processes by which these objects interact with one another. We will see, though, that it is much more. It is also humanity’s attempt to organize what we learn into a clear history of the universe, from the instant of its birth in the Big Bang to the present moment. Throughout this book, we emphasize that science is a progress report—one that changes constantly as new techniques and instruments allow us to probe the universe more deeply.
In considering the history of the universe, we will see again and again that the cosmos evolves; it changes in profound ways over long periods of time. For example, the universe made the carbon, the calcium, and the oxygen necessary to construct something as interesting and complicated as you. Today, many billions of years later, the universe has evolved into a more hospitable place for life. Tracing the evolutionary processes that continue to shape the universe is one of the most important (and satisfying) parts of modern astronomy.


# Science and the Universe: A Brief Tour

## The Nature of Science

The ultimate judge in science is always what nature itself reveals based on observations, experiments, models, and testing. Science is not merely a body of knowledge, but a method by which we attempt to understand nature and how it behaves. This method begins with many observations over a period of time. From the trends found through observations, scientists can model the particular phenomena we want to understand. Such models are always approximations of nature, subject to further testing.
As a concrete astronomical example, ancient astronomers constructed a model (partly from observations and partly from philosophical beliefs) that Earth was the center of the universe and everything moved around it in circular orbits. At first, our available observations of the Sun, Moon, and planets did fit this model; however, after further observations, the model had to be updated by adding circle after circle to represent the movements of the planets around Earth at the center. As the centuries passed and improved instruments were developed for keeping track of objects in the sky, the old model (even with a huge number of circles) could no longer explain all the observed facts. As we will see in the chapter on Observing the Sky: The Birth of Astronomy, a new model, with the Sun at the center, fit the experimental evidence better. After a period of philosophical struggle, it became accepted as our view of the universe.
When they are first proposed, new models or ideas are sometimes called hypotheses. You may think there can be no new hypotheses in a science such as astronomy—that everything important has already been learned. Nothing could be further from the truth. Throughout this textbook you will find discussions of recent, and occasionally still controversial, hypotheses in astronomy. For example, the significance that the huge chunks of rock and ice that hit Earth have for life on Earth itself is still debated. And while the evidence is strong that vast quantities of invisible “dark energy” make up the bulk of the universe, scientists have no convincing explanation for what the dark energy actually is. Resolving these issues will require difficult observations done at the forefront of our technology, and all such hypotheses need further testing before we incorporate them fully into our standard astronomical models.
This last point is crucial: a hypothesis must be a proposed explanation that can be tested. The most straightforward approach to such testing in science is to perform an experiment. If the experiment is conducted properly, its results either will agree with the predictions of the hypothesis or they will contradict it. If the experimental result is truly inconsistent with the hypothesis, a scientist must discard the hypothesis and try to develop an alternative. If the experimental result agrees with predictions, this does not necessarily prove that the hypothesis is absolutely correct; perhaps later experiments will contradict crucial parts of the hypothesis. But, the more experiments that agree with the hypothesis, the more likely we are to accept the hypothesis as a useful description of nature.
One way to think about this is to consider a scientist who was born and lives on an island where only black sheep live. Day after day the scientist encounters black sheep only, so he or she hypothesizes that all sheep are black. Although every observed sheep adds confidence to the hypothesis, the scientist only has to visit the mainland and observe one white sheep to prove the hypothesis wrong.
When you read about experiments, you probably have a mental picture of a scientist in a laboratory conducting tests or taking careful measurements. This is certainly the case for a biologist or a chemist, but what can astronomers do when our laboratory is the universe? It’s impossible to put a group of stars into a test tube or to order another comet from a scientific supply company.
As a result, astronomy is sometimes called an observational science; we often make our tests by observing many samples of the kind of object we want to study and noting carefully how different samples vary. New instruments and technology can let us look at astronomical objects from new perspectives and in greater detail. Our hypotheses are then judged in the light of this new information, and they pass or fail in the same way we would evaluate the result of a laboratory experiment.
Much of astronomy is also a historical science—meaning that what we observe has already happened in the universe and we can do nothing to change it. In the same way, a geologist cannot alter what has happened to our planet, and a paleontologist cannot bring an ancient animal back to life. While this can make astronomy challenging, it also gives us fascinating opportunities to discover the secrets of our cosmic past.
You might compare an astronomer to a detective trying to solve a crime that occurred before the detective arrived at the scene. There is lots of evidence, but both the detective and the scientist must sift through and organize the evidence to test various hypotheses about what actually happened. And there is another way in which the scientist is like a detective: they both must prove their case. The detective must convince the district attorney, the judge, and perhaps ultimately the jury that his hypothesis is correct. Similarly, the scientist must convince colleagues, editors of journals, and ultimately a broad cross-section of other scientists that her hypothesis is provisionally correct. In both cases, one can only ask for evidence “beyond a reasonable doubt.” And sometimes new evidence will force both the detective and the scientist to revise their last hypothesis.
This self-correcting aspect of science sets it off from most human activities. Scientists spend a great deal of time questioning and challenging one another, which is why applications for project funding—as well as reports for publication in academic journals—go through an extensive process of peer review, which is a careful examination by other scientists in the same field. In science (after formal education and training), everyone is encouraged to improve upon experiments and to challenge any and all hypotheses. New scientists know that one of the best ways to advance their careers is to find a weakness in our current understanding of something and to correct it with a new or modified hypothesis.
This is one of the reasons science has made such dramatic progress. An undergraduate science major today knows more about science and math than did Sir Isaac Newton, one of the most renowned scientists who ever lived. Even in this introductory astronomy course, you will learn about objects and processes that no one a few generations ago even dreamed existed.


# Science and the Universe: A Brief Tour

## The Laws of Nature

Over centuries scientists have extracted various scientific laws from countless observations, hypotheses, and experiments. These scientific laws are, in a sense, the “rules” of the game that nature plays. One remarkable discovery about nature—one that underlies everything you will read about in this text—is that the same laws apply everywhere in the universe. The rules that determine the motion of stars so far away that your eye cannot see them are the same laws that determine the arc of a baseball after a batter has hit it out of the park.
Note that without the existence of such universal laws, we could not make much headway in astronomy. If each pocket of the universe had different rules, we would have little chance of interpreting what happened in other “neighborhoods.” But, the consistency of the laws of nature gives us enormous power to understand distant objects without traveling to them and learning the local laws. In the same way, if every region of a country had completely different laws, it would be very difficult to carry out commerce or even to understand the behavior of people in those different regions. A consistent set of laws, though, allows us to apply what we learn or practice in one state to any other state.
This is not to say that our current scientific models and laws cannot change. New experiments and observations can lead to new, more sophisticated models—models that can include new phenomena and laws about their behavior. The general theory of relativity proposed by Albert Einstein is a perfect example of such a transformation that took place about a century ago; it led us to predict, and eventually to observe, a strange new class of objects that astronomers call black holes. Only the patient process of observing nature ever more carefully and precisely can demonstrate the validity of such new scientific models.
One important problem in describing scientific models has to do with the limitations of language. When we try to describe complex phenomena in everyday terms, the words themselves may not be adequate to do the job. For example, you may have heard the structure of the atom likened to a miniature solar system. While some aspects of our modern model of the atom do remind us of planetary orbits, many other of its aspects are fundamentally different.
This problem is the reason scientists often prefer to describe their models using equations rather than words. In this book, which is designed to introduce the field of astronomy, we use mainly words to discuss what scientists have learned. We avoid complex math, but if this course piques your interest and you go on in science, more and more of your studies will involve the precise language of mathematics.


# Science and the Universe: A Brief Tour

## Numbers in Astronomy

In astronomy we deal with distances on a scale you may never have thought about before, with numbers larger than any you may have encountered. We adopt two approaches that make dealing with astronomical numbers a little bit easier. First, we use a system for writing large and small numbers called scientific notation (or sometimes powers-of-ten notation). This system is very appealing because it eliminates the many zeros that can seem overwhelming to the reader. In scientific notation, if you want to write a number such as 500,000,000, you express it as . The small raised number after the 10, called an exponent, keeps track of the number of places we had to move the decimal point to the left to convert 500,000,000 to 5. If you are encountering this system for the first time or would like a refresher, we suggest you look at Appendix C and  for more information. The second way we try to keep numbers simple is to use a consistent set of units—the metric International System of Units, or SI (from the French Système International d’Unités). The metric system is summarized in Appendix D (see ).
A common unit astronomers use to describe distances in the universe is a light-year, which is the distance light travels during one year. Because light always travels at the same speed, and because its speed turns out to be the fastest possible speed in the universe, it makes a good standard for keeping track of distances. You might be confused because a “light-year” seems to imply that we are measuring time, but this mix-up of time and distance is common in everyday life as well. For example, when your friend asks where the movie theater is located, you might say “about 20 minutes from downtown.”
So, how many kilometers are there in a light-year? Light travels at the amazing pace of  kilometers per second (km/s), which makes a light-year  kilometers. You might think that such a large unit would reach the nearest star easily, but the stars are far more remote than our imaginations might lead us to believe. Even the nearest star is 4.3 light-years away—more than 40 trillion kilometers. Other stars visible to the unaided eye are hundreds to thousands of light-years away ().


# Science and the Universe: A Brief Tour

## Consequences of Light Travel Time

There is another reason the speed of light is such a natural unit of distance for astronomers. Information about the universe comes to us almost exclusively through various forms of light, and all such light travels at the speed of light—that is, 1 light-year every year. This sets a limit on how quickly we can learn about events in the universe. If a star is 100 light-years away, the light we see from it tonight left that star 100 years ago and is just now arriving in our neighborhood. The soonest we can learn about any changes in that star is 100 years after the fact. For a star 500 light-years away, the light we detect tonight left 500 years ago and is carrying 500-year-old news.
Because many of us are accustomed to instant news from the Internet, some might find this frustrating.
“You mean, when I see that star up there,” you ask, “I won’t know what’s actually happening there for another 500 years?”
But this isn’t the most helpful way to think about the situation. For astronomers, now is when the light reaches us here on Earth. There is no way for us to know anything about that star (or other object) until its light reaches us.
But what at first may seem a great frustration is actually a tremendous benefit in disguise. If astronomers really want to piece together what has happened in the universe since its beginning, they must find evidence about each epoch (or period of time) of the past. Where can we find evidence today about cosmic events that occurred billions of years ago?
The delay in the arrival of light provides an answer to this question. The farther out in space we look, the longer the light has taken to get here, and the longer ago it left its place of origin. By looking billions of light-years out into space, astronomers are actually seeing billions of years into the past. In this way, we can reconstruct the history of the cosmos and get a sense of how it has evolved over time.
This is one reason why astronomers strive to build telescopes that can collect more and more of the faint light in the universe. The more light we collect, the fainter the objects we can observe. On average, fainter objects are farther away and can, therefore, tell us about periods of time even deeper in the past. Instruments such as the Hubble Space Telescope () and the Very Large Telescope in Chile (which you will learn about in the chapter on Astronomical Instruments), are giving astronomers views of deep space and deep time better than any we have had before.