Performance of a business, that is how well or poorly a business is doing viz-a viz owner- manager set objectives is crucial to business success. Once a business is not performing well, certain danger signals such as poor profit growth will manifest. Murray (1994) argues that “many small and medium enterprises owners either do not understand the significance of these warnings or tend to optimistically believe that things will get better on their own”.
Case and Fair (2009) noted that production will be more profitable at a time of rising prices since the prices of finished goods rise faster than the cost of production, thereby giving the producers opportunity to make profits. Even if the cost of production is high, the prices of customer goods will generally rise faster than the price of capital goods, as the cost will fall back on the final consumers. Clark (1982) noted that inflation brings changes in production and such changes in turn, lead to changes in employment and wages, thereby increasing the unemployment rates and eventually changing the prices. It is impossible to predict with any certainty the exact size or timing of these influences as the effects vary based on factors such as the stage of the economic cycle, environmental stance, the nature of economic condition and the level of the development of the financial market. For example, the impact of higher consumer demand on inflation during economic recession or during political instability is quite different from how it would be during economic boom or during political stability in the country
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