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Impact of Currency Redenomination on an Economy: An Evidence of Ghana

Bright Obuobi, Emmanuel Nketiah, Faustina Awuah, Fredrick Oteng Agyeman, Deborah Ofosu, Gibbson Adu-Gyamfi, Mavis Adjei, Adelaide Gyanwah Amadi
International Business Research , Volume 13; doi:10.5539/ibr.v13n2p62

Abstract: The main objective of this study is to ascertain the impact of currency redenomination on the Ghanaian economy. Since independence in 1957, Ghana has had series of redenomination exercises but the recent one which became a debatable topic happened in 2007. As a result, the study is conducted to determine the pre and post-performance of the country using 2007 as the benchmark. This research takes into consideration the quantitative research technique based on ex-post factor design. Secondary data of the research variables (GDP, Economic growth, Balance of trade, inflation, FDI and Globalization index) were used over a 20-year period between 1997 and 2017. Analytical techniques of both descriptive statistics and independent sample test were used for the research. The t-test for equality of means adopted was to determine the statistically significant difference on the economic variables. The study also used the Levene’s test of equality of variance assumed. It was concluded that, currency redenomination is beneficial to an economy’s growth. It was therefore recommended that, the government of Ghana initiates policies that will boost local production to support the exercise so as to increase GDP and other associated economic variables.
Keywords: GHANA / GDP / exercises / Economy / statistically / economic variables / Currency Redenomination / Test of Equality

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