EFFECT OF MACROECONOMIC ON CAPITAL STRUCTURE OF QUOTED MANUFACTURING FIRMS

Abstract This study aim is to examine the effect of macroeconomic on capital structure of quoted manufacturing Firms. The research design adopted in this study is survey designs which relies mainly on the use of secondary data. The target population for this study consists of all the manufacturing firms quoted on the Nigerian stock Exchange as at Dec. 2024. Simple random sampling method was adopted in selecting the sample size of five (5) quoted firms in Nigeria. Secondary data were sourced from Nigeria Exchange Group. Linear regression technique was applied to panel series of data to test the hypothesis, while t-statistics and p-value were used in determining the level of significant effect of micro economic on capital structure. The result revealed that the model represents the relationship between explanatory variables (exchange rate, inflation rate and interest rate) and dependent variable return on asset. The model shows the coefficient of determination (R-Square) with a value of 0.8547 which means that in Nigeria, about 85% of the total systematic variations in capital structure variables can be explained by the variables namely exchange rate, inflation rate, interest rate and capital structure. Based on this, I recommend among other things that policymakers should be more specific about how to improve the economic conditions in an economy which will aid firms to make valuable decisions on debt management and policymakers should also create an environment that supports managerial training and should also continue to formulate policies that encourage firm managers to take advantage of training opportunities to enrich their skill and knowledge on debt financing considering macroeconomic conditions in an economy.