Original Research
Economics
Elham Kamal
Abstract
This paper sheds a new light on the role of central bank credibility (CBC) in explaining the extent of exchange rate pass-through (ERPT) in two stages. In the first stage, using 60 months rolling window regression of the inflation on the nominal effective exchange rate is obtained time-varying ERPT during ...
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This paper sheds a new light on the role of central bank credibility (CBC) in explaining the extent of exchange rate pass-through (ERPT) in two stages. In the first stage, using 60 months rolling window regression of the inflation on the nominal effective exchange rate is obtained time-varying ERPT during 1990m1-2020m1. Once the credibility index (deviation of average of past inflation from target) is computed over a period of 29 years (1991-2019), in the second stage, the sample of 19 inflation targeting (IT) economies are split into different regimes with regard to the credibility values by using a Panel Threshold Regression (PTR) model. Our empirical result shows that there is one threshold point for CBC which is well identified by the data, allowing me to split my sample into two credibility regimes. When CBC level is below a threshold of 35% within a high-inflation environment, the extent of the ERPT coefficient is found to be higher. However, with the shift towards high-credibility regime, when credibility level is exceeding the threshold of 35%, the level of pass-through is significantly declining in the IT countries. This finding sheds further light on how the credibility gained through the commitment to the targets can be effective on the performance of the central bank and would ensure the better control of the pass-through.
Original Research
Accounting
Saeed Pakdelan; Alireza Azarberahman; Sara Akbari; Jalal Azarberahman
Abstract
Risk disclosure refers to providing information to the user to inform of any opportunities or threats .Theoretically, disclosure mainly aims to reduce the information asymmetry as well as investor uncertainty, thereby indirectly lowering the equity cost. An advantage of risk disclosure is its effectiveness ...
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Risk disclosure refers to providing information to the user to inform of any opportunities or threats .Theoretically, disclosure mainly aims to reduce the information asymmetry as well as investor uncertainty, thereby indirectly lowering the equity cost. An advantage of risk disclosure is its effectiveness in reducing the equity cost. Therefore, risk disclosure can help decrease investor uncertainty, thus diminishing the equity cost. This project mainly investigates the relationship between risk reporting and cost of capital in 174 firms listed on the Tehran Stock Exchange for the period 2012-2018. This is an applied research study in terms of purpose and descriptive-correlational in terms of methodology. In this study, the variable of risk disclosure was collected by analyzing the content of financial statements, explanatory notes, and board of director reports. The cost of capital was calculated in three ways: cost of debt, cost of ordinary shares, and weighted average cost of capital (WACC). Thus, the relationship between risk disclosure and cost of capital was examined in the form of three individual hypotheses. The results demonstrated no significant relationship between risk disclosure and cost of debt; therefore, the first hypothesis is rejected. It was also suggested that there is a statistically significant negative relationship between risk disclosure and cost of common equity; thus, the second hypothesis was confirmed. Finally, risk disclosure appeared to have a statistically significant negative relationship with WACC; therefore, the third hypothesis was confirmed.
Case Study
Management
Simon Githae
Abstract
One of the areas of focus recently has been the potential of mobile apps services as a solution to overcome low levels of infrastructure development, that hinder full exploitation of business opportunities in developing countries like Kenya. It was with this in view that the primary objective of this ...
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One of the areas of focus recently has been the potential of mobile apps services as a solution to overcome low levels of infrastructure development, that hinder full exploitation of business opportunities in developing countries like Kenya. It was with this in view that the primary objective of this study was to investigate the effect of mobile distribution applications services on sales of fast-moving consumer goods produced and sold by PZ Cussons. Specifically, this study sought: to determine the influence of mobile apps memory support services on sales of fast-moving consumer goods; The study employed a census sampling method. The target population was small enough to conduct a census survey of 80 employees at PZ Cussons East Africa using questionnaires as the primary data collection tool. Cronbach’s alpha coefficient was adopted to ascertain for reliability that was obtained through split-half technique. Quantitative data used simple linear regression to test the strength of the relationship between the variables based on observed data and to predict the value of the dependent variable based on the independent variable. The study concluded that memory support services by mobile app services influences sales of fast-moving consumer goods, The research recommended the need for adequately adoption of technology driven business intelligent services to predict consumer preferences to enhance sales of fast-moving consumer goods.
Case Study
Accounting
Hadis Naderi; Majid Moradi; Farzin Khoshkar
Abstract
Stock prices face several negative and sudden adjustments and managers postpone disclosing the negative/bad news for a long term. A consequence of stock price cash risk may be on the cost of capital which is funds’ cost for a company, or from an investor's perspective, it is the necessary rate ...
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Stock prices face several negative and sudden adjustments and managers postpone disclosing the negative/bad news for a long term. A consequence of stock price cash risk may be on the cost of capital which is funds’ cost for a company, or from an investor's perspective, it is the necessary rate of return on the current securities portfolio of a company. This criterion is employed to assess new projects of a company, as well. Accordingly, an issue which has not been significantly addressed in the research about the relationship between stock price cash risk and cost of capital is the mediating role of large shareholders’ ownership, while shareholders essentially own the company and reap the benefits or losses of the firm’s success or failure. Hence, the objective of this research is to investigate the effect of stock price crash risk on the cost of capital with the mediating role of the large shareholders’ ownership. For this purpose, we considered the listed firms in the Tehran Stock Exchange as our case study. Noticeably, the research time scope is 2012-2019. The method of this research is applied and its nature and content are correlational. Both deductive and inductive reasoning frameworks were used to undertake the study and the hypotheses were analyzed by panel analysis approach. The results showed that the stock price crash risk has a positive and significant effect on the cost of capital, however, the large shareholders’ ownership reduces the effect of stock price crash risk on the cost of capital.
