The Question of Whether Businesses Should Be Able to Profit

question 31

Essay

The question of whether businesses should be able to profit from prisons is one of the more polarizing issues within the corrections community. You are the mayor of a city on the eastern seaboard, which has a budgetary shortfall, and overcrowded jails. There is a bill that is about to come to your desk which proposes two solutions: that inmates in jails pay a daily fee, and one allowing a private company to take over an entire diversion program in exchange for "administrative fees" paid to the city. Write a speech detailing the problems with this approach, which also indicates an understanding for its rationale.

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Definitions:

Nominal Rate

The interest rate stated on a financial product or agreement without adjustment for inflation or other factors that affect the real value of returns.

Stated Value

Stated value refers to an arbitrary value assigned to the no-par value stock by the board of directors of a company, used for accounting purposes.

Effective Yield

The total yield on an investment, taking into account all compounding periods, fees, and other factors affecting the actual return.

Stated Rate

The interest rate declared on a financial instrument, such as a bond or loan, not taking into account compounding or fees.