INCOME AND DEBT COMPONENTS OF FARM FINANCIAL STRESS: A NATAL EXAMPLE.

This study allocates farm financial stress into an income problem and a debt problem (leverage and interest rate) for a selected sample of Natal farms. This is done by comparing leverage and interest rates for farms experiencing financial stress (negative rate of return to equity) with a target leverage ratio and interest rate for those farms which are financially successful (positive rate of return to equity). The results show that some 65.4% of financial stress, for sample farms, is due to an income problem, 25.6% to leverage and 9.0% to an interest rate problem. Policies which alleviate the income problem will therefore be the most effective for these farms.


Issue Date:
1992-12-1992-12-1992-12
Publication Type:
Journal Article
ISSN:
0303-1853
Language:
English
Published in:
Agrekon, Volume 31, Issue 4
Page range:
272-276




 Record created 2018-01-31, last modified 2018-02-01

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