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The Effect Of Exchange Rate Fluctuation On The Nigeria Maufacturing Sector
[A CASE STUDY OF 1986-2010]
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1.3 OBJECTIVES OF THE STUDY
In a highly import dependent economy like
Nigeria, the naira exchange rate has become one of the most widely
discussed topic in the country today. This is not surprising as this
topic has had a lot of impact on the Nigerian manufacturing sector. It
is therefore, the objective of this study to evaluate the effect of
exchange rate fluctuation on the Nigerian manufacturing sector.
To investigate empirically, the effect of exchange rate fluctuation on Nigerian import or export and capital goods.
To
determine if the continuous fluctuation of exchange rate of naira have
an impact on the quality and quantity of output of manufacturing firms.
1.4 RESEARCH QUESTIONS
To what extent does exchange rate fluctuation affect the importation of input and capital goods?
Does exchange rate fluctuation have effect on the quality and quantity at goods manufactured by Nigeria firms?
To what extent does exchange rate fluctuation affect the exportation of made in Nigeria goods?
1.5 FORMULATION OF HYPOTHESES
The hypothesis of the study includes the null hypothesis denoted as „H0‟ and alternative hypothesis as „H‟.
H0: Exchange rate fluctuations have no effect on the importation of input and capital goods.
H1: Exchange rate fluctuations have effect on the importation of input and capital goods.
H0: Exchange rate fluctuation has no significant effect on the quality and quantity of goods manufactured by Nigerian firms.
H1: Exchange rate fluctuation has a significant effect on the quality and quantity of goods manufactured by Nigerian firms.
H0: Exchange rate fluctuations do not affect the exportation of made in Nigeria goods.
H1: Exchange rate fluctuations affect the exportation of made in Nigeria goods.
1.6 SIGNIFICANT OF THE STUDY
The
study would identify the strengths and weakness of exchange rate policy
and management, identify those parts that are mostly affected by
instability in exchange rate provide the general public with adequate
information on the foreign exchange transaction and its impact on the
manufacturing sector. In general, the study benefits the following;
1.
The government will benefit as it will enable them ascertain the extent
of the variation of exchange rate affect the quality of input and
capital goods imported into Nigeria by manufacturing firms, the
government can make policies that will help Nigerian manufacturers
prosper in the business.
2. The manufacturers will be much aware of the impact of the exchange rate fluctuations on their firms.
3. To the students, it will be a work base for further research.
4.
To the public it will be a thorough understanding of the exchange rate
fluctuation and having taken appropriate measure will lead to a stable
economy.
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ABSRACT - [ Total Page(s): 1 ]ABSTRACTThis paper examines the effect of exchange rate fluctuations on the Nigerian manufacturing sector during a twenty five (25) years period (1986 – 2010). The argument is that fluctuation in exchange rate adversely affects output of manufacturing sector. This is because Nigerian manufacturing is highly dependent on import of input and capital goods. The methodology adopted for this study is empirical. The econometric tool of regression was used for the analysis. The population target ... Continue reading---
