The effects of interest rates on the performance of afro PLAST company Luzira:
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Date
2019-09
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Publisher
Kampala International University, College of Economics and Management.
Abstract
The purpose of this study was to examine the effects of Interest rates on the performance of Afro
Plast Company Luzira, The objectives of the study were to evaluate the effect of interest rates on
business performance, to analyze the effect of interest rates on the loan acquisition by businesses and to examine the relationship between the level of interest rates and business performance. The
study used both primary and secondary data in its analysis and the researcher used descriptive
nodes of analysis using mainly quantitative and qualitative methods to capture data. The study
fndings on the effect of interest rates on business performance revealed that 40% strongly
~greed, 38% agreed, 10% were neutral , 4% disagreed while the remaining 8% strongly
disagreed with the statement that nearly every small business has outstanding loans, and when
interest rates rise, those loans become more expensive, similarly 38% strongly agreed , 36%
~greed, 6% were neutral, 10% disagreed and 10% strongly disagreed with the statement that Allen interest rates rise, consumers with debts are going to have to pay more interest to lenders.
[his typically has a negative effect on their spending habits because the more money they have
o pay to keep their loans current. Similarly the findings on the effect of interest rates on the loan requisition by businesses revealed that the coefficient (0.00 1) from the chi-square table implied
hat since the P-value (0.001) is less than 0.05 the confidence level we reject the null hypothesis conclude with the alternative that there is a significant effect of interest rate on the
Lcquisition of loans. The implication here is that when the interest rate increases, many people will not obtain loans from financial institutions to expand their businesses hence affecting the
performance and expansion of these businesses. The study recommends that the central bank should use the necessary tools to control the level of the interest rates since it affects the
erformance of the small scale businesses and the Government should provide finances in terms
f loans to the entrepreneurs of the small businesses at reduced interest rates compared to the
aterest rates given by the commercial bank.
Description
a research report submitted to the college of economics and management in partial fulfillment of the requirements for the award of a bachelor’s degree in business administration (accounting and finance) of Kampala international university.
Keywords
interest rates, performance, PLAST company