Acceptance of Islamic Hire Purchase Facility

Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 CHAPTER ONE: 1. 0 INTRODUCTION OF THE STUDY INTRODUCTION The Islamic concept of Al-Ijarah Thumma al-bay’ refers to lease or hire or rent ending with purchase. It is a type of lease which concludes with option to buy back which is concludes the legal title of the leased asset and will be passed to the lessee at the end of the period.It is one of the contemporary innovative products which are design to meet the public demand at the same time, securing long term competitiveness in the financial market. AITAB comprised two contracts which are al-ijarah (leasing or renting) and followed by al-bay’ (sale) contract. Al-Ijarah: a contract whereby the lessor (Islamic bank) will rent the assets to the lessee (customer) over a certain period and at the end monthly rental amount as agreed by both parties. (Khir et al. 2008) Al-Bay’: upon completion of the rental period or upon the early settlement the lessor will then enter into the sale contract with the lessee to sell the asset at a pre-agreed selling price. (Khir et al. , 2008) Al-ijarah and al-bay’ are both categorised under the contract of exchange. The former relate to the exchange of usufruct for money, while latter involves the exchange of good for money. In AITAB the contract of al-ijarah runs separately from the contract of al-bay’. Since both contracts are executed in a sequence.A new contract AITAB can be used to describe the process of converting an Ijarah into a sale contract. (Khir et al. , 2008) AITAB is one of the contemporary innovative approaches in the Islamic hire purchase instrument which is an alternative product to conventional hire purchase. The significant difference between the two is that Islamic hire purchase is a unique contract involving a combination of two different contracts, thus involving a number of legal and shariah issues. It 1 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 calls for special rules on leasing and sale at different stages of the transactions in the light of shariah. It refers to owning the benefit of certain assets for a specific period of time, by paying an agreed sum of rental, with an agreement that the owner will transfer the rented asset to the hirer at the end of the agreed period or during the period, provided all rental payments or instalments have been made in entirety.The transfer of ownership is affected by a new and independent contract, either by giving the asset as a gift, or selling it at an agreed price. (AlZuhayli, 2002) Conventional hire-purchase, the product is considered as a loan to which interest rate and hiring charges would be applicable and in case of late payment of instalment price, interest would accumulate. But in Islamic hire-purchase, the product is considered as a mode of financing, not a loan and the product would have a profit rate and a mark-up and for late payment of instalment price, only late payment charge pre-agreed would be applicable. Billah) Based on the statements above, the researcher conduct the study among staff in Jabatan Pelajaran Negeri Kelantan to identify the most significantly criteria’s such as perception, competency among car dealers and bank officer and awareness can influence them in order to accept Islamic hire purchase facility. The result for the acceptance of Islamic hire purchase facility will be collected by distributed the questionnaire to 200 staff in Jabatan Pelajaran Negeri Kelantan.After that, the analysis will be interpreted by using the SPSS 20. 0 program. 2 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 1. 1 BACKGROUND OF COMPANY JABATAN PELAJARAN NEGERI KELANTAN ESTABLISHMENT HISTORY Jabatan Pelajaran Negeri Kelantan history start when th e director first (formerly called Penguasa Pelajaran) namely Encik Mohd Ghazali B. Mohd Ariffn designate at year 1992. He then awarded with the title Dato' Bentara Luar and work until year 1930.The office first located in building known by the name of â€Å"Pejabat Panjang†, namely a building nearby Istana Kota Lama. Then in year 1930 an on the other hand Pejabat Pelajaran move on the other hand to other building known by the name of â€Å"Pejabat Pohon Celagi† namely Kelantan State Secretary building, nearby old office building. In year 1965 the office move on the other hand to new building namely Bangunan Persekutuan that is today. From year 1922 to 18 august 1998 there are 25 people Director.They are made up 13 people noble Malay, 10 people noble English and 2 people that noble Chinese. Director Encik Saw Chee Ling had given his service for 12 years. Since colonial era until today, Jabatan Pelajaran Negeri Kelantan has been expanding rapidly him in effort increase t his quality education in accordance with Education Philosophy policy country. Today, Jabatan Pelajaran Negeri Kelantan has owned 10 sectors that include Sektor Khidmat Pengurusan dan Pembangunan, Sektor Pengurusan Sekolah, Sektor Pengurusan Akademik and Sektor Pendidikan Islam.Under this department also be established State Educational Technology Division. While at district level on the other hand was constituted ten parts of Pejabat Pendidikan Daerah namely Pejabat Pendidikan Daerah Kota Bharu, Pejabat Pendidikan Daerah Pasir Mas, Pejabat Pendidikan Daerah Tumpat, Pejabat Pendidikan Daerah Pasir Puteh, Pejabat Pendidikan Daerah Bachok, Pejabat Pendidikan Daerah Tanah Merah, Pejabat Pendidikan Daerah Machang, Pejabat Pendidikan Daerah Kuala Krai, Pejabat Pendidikan Daerah Gua Musang and Pejabat Pendidikan Daerah Jeli. Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 1. 2 PROBLEM STATEMENTS Dual banking syste m imposes by Bank Negera Malaysia affecting the demand for Islamic financial product. This situation has influenced some staff in Jabatan Pelajaran Negeri Kelantan to choose Islamic or conventional hire purchase loan for buying car. In this study, staff perception toward Islamic hire purchase facility implies whether they are really known about the AITAB operation itself.Researcher also identify common perception toward AITAB contract which is profit charge are too costly, penalty charge for late payment, accordance with syariah guideline and more Researcher also knows car dealers and bank officers also as importance key player toward acceptance of Islamic hire purchase facility. Thus, researcher also identify common problem about competency among car dealers and bank officer whether among them are lack of knowledge about Islamic financial product.Others problem that researcher identify is awareness among staff in Jabatan Pelajaran Negeri Kelantan itself whether they aware about Isl amic Hire Purchase facility or not. The common problem on awareness among staff is what Islamic Hire Purchase have compared to conventional, the existence of Islamic financial product, the modus operandi of the AITAB contract itself and more. I. 3 OBJECTIVES OF THE STUDY There are several objectives that have been developed in this research as the following:I. II. III. To examine staff perception toward Islamic hire purchase facility.To identify competency among car dealers and bank officers. To evaluate effects of awareness among staff in Jabatan Pelajaran Negeri Kelantan. In this research, researcher identifies the most contributing factor of acceptance of Islamic Hire Purchase facility among staff in Jabatan Pelajaran Negeri Kelantan is awareness. This had be proven by Pearson correlation relationship at r = 0. 837 4 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 1. 4 SCOPE OF THE STUDYThis study will f ocus on the acceptance towards Al-Ijarah Thumma Al-Bay’, Islamic hire purchase facility among staffs in Jabatan Pelajaran Negeri Kelantan. In this research, researcher had pick up about 200 staff from the population of 460 staff in Jabatan Pelajaran Negeri Kelantan as are respondents to complete the questionnaire. The respondent of this study are all staff in Jabatan Pelajaran Negeri Kelantan which are mostly involve in hire purchase facility that offered by Islamic and conventional bank. The researcher has chosen this area because of high population. 1. LIMITATIONS OF THE STUDY The first limitation is that the probability of absenteeism of the respondent due to leave or outstation since all respondents is the staff of Jabatan Pelajaran Negeri Kelantan. The second limitation is lack of knowledge. Researcher does not have experience and never been exposed in making a complete research in the university. Researchers will facing difficulties to understand the word using by the r espondent. The third limitation is uncooperative respondent. In process of gathering the information, researcher will need to collect data through the questionnaire.However, it can be difficult to gain full cooperation and commitment from the respondent and they may think that it does not give any advantage to them. Respondent also will take a very long time to answer the questionnaire and it also will make the researcher take a long time to analysis the data. Corporate constraint also can be a limitation in this study because the respondent cannot give hundred percent performances in answer the questionnaire. 5 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 1. 6 SIGNIFICANT OF STUDYTo the Manager Help the manager to identify the behaviour of his subordinates and how they react towards the acceptance of Al-Ijarah Thumma Al-Bay’ Islamic Hire Purchase Financing as their source of car financing. To the researcher It will provide better understanding and can give new knowledge to the researcher. The study will be conducted to give a clear picture on the staff’s awareness and acceptance on the AlIjarah Thumma Al-Bay’ Islamic Hire Purchase Financing. The result of the study will help the researcher to know the stuff’s perceptions towards factors that influence stuffs decisions in accepting Islamic Financing Product.To the public The data gathered in this study can help the individual to gain more knowledge about the important and benefits of accepting Al-Ijarah Thumma Al-Bay’ Islamic Hire Purchase Financing as part of their source of car financing. This study may increase the level of awareness and create acceptance among public about Al-Ijarah Thumma Al-Bay’ Islamic Hire Purchase financing as their source of car financing decisions. To others The information may be used by the financial institution to improve the services related with Islamic Car Financing product. This study may provide useful information for further research in this area of interest.The findings of this study could provide some form of empirical data for future research in this area. It could perhaps also help in the more effective implementation of Al-Ijarah Thumma Al-Bay’ Islamic Hire Purchase Financing. 6 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 To the bank There are a lot of benefits of this research to the bank. From this research, it will provide information to the bank on the real scenario. Therefore, the bank can use this information and results to improve its management, services, efficiency and etc.In fact, with this research it will help the bank to come out with new strategies and solutions to monitor its profitability and can improve its performance. Thus, the bank can also use the recommendations suggested by the researcher to improve its performance an d position. 7 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 1. 7 DEFINITION OF TERM Al-Ijarah Thumma Al-Bay’ In the context of Islamic finance, the ijarah concept is usually applicable in financing contracts such as in real property financing, vehicle financing, project financing and personal financing.There are also financing products that enable customers to lease assets from Islamic financial institutions with an option to acquire the leased assets at the end of the lease tenure based on the concept of ijarah muntahia bi al-tamlik or al-ijarah thumma al-bai (Bank Negera M. , 2010) Perception Customers’ perceptions are often identified by their level of satisfaction towards particular products or services. (Nurdianawati I. A, 2006) Competency More competent, knowledgeable employees are more likely to design processes and deliver services that conform to customer needs. (Ahmad, 2010).Awaren ess Research on bank patronage in Malaysia find that almost 100 per cents of Muslims and 75% of non-Muslims were aware of the existence of Islamic banks. Most of them wished to have a relationship with these banks if they had a complete understanding of this system. (Sudin Haron N. A. , 1994) Acceptance AITAB is a name which capture a public acceptance because it provides better features compared to conventional hire-purchase. Muslim customers, who accept and understand its operation, request it as an alternative to conventional hire-purchase. (Nurdianawati I. A, 2006) 8Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 CHAPTER TWO: 2. 0 INTRODUCTION LITERATURE REVIEW Literature review is important as references and as a guideline to the researcher in conducting research and to search the information. It also used as the supporter to the study that will be conducted. This chapter will discuss about the literat ure review which relevant to the topic of the study. The purpose is to ensure that no important variable that has in the past been found repeatedly to have had an impact on the problem is ignored. . 1 Acceptance AITAB is a name which capture a public acceptance because it provides better features compared to conventional hire-purchase. Muslim customers, who accept and understand its operation, request it as an alternative to conventional hire-purchase. They will come to an institution which they know offering such Islamic product. For example, many corporate customers come to Bank Pembangunan to purchase machinery through AITAB facility, because they know the benefits that the facility has to offer, for example, full margin of financing and lower penalty for late payment. Nurdianawati, 2006) Other finding shown AITAB also gains support from the non-Muslims. In some institutions, 60% of their customers are non-Muslims, comprising the Chinese in majority. They can see the advantage of signing up AITAB, which is 1% penalty for late payment, as compared to conventional hire-purchase which imposes 8% penalty. (Bank Negara, 1998) A survey in United Kingdom found the demand for Islamic financing will grow in future if Islamic banks pratice the correct marketing measures. In the research, five (5 %) percents of muslim in United Kingdom are loyal customers to the Islamic financial services.Majority of muslim are still comfortable with the conventional financial services, while only a quater of muslims tend to show preference for Islamic finance. (Humayon, 2004) 9 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 2. 2 Perception Nowadays, in the dual banking system that had been practice by Malaysia giving an effect to the consumer to choose either Islamic Hire Purchase or Conventional hire purchase. Mostly Muslim customers claim that there are no differences between Islamic Hire-Purchase and Con ventional Hire Purchase.Islamic banking products are available at two full pledged Islamic banks and at all commercial and merchant banks in Malaysia. However, these products are still not fully accepted by customers. According to Norafifah Ahmad and Sudin Haron (2002), at the end of 2000, total deposit at conventional banks was RM381 billion while total deposit in Islamic Financial Institution was RM31 billion. In the case of loans, RM416 billion was extended by conventional system, and RM21 billion was given by Islamic system. This results indicates that perception of Conventional System were far good than Islamic financial system.Islamic Hire purchase (AITAB) provides better features compared to conventional hirepurchase. Muslim customers, who accept and understand its operation, request it as an alternative to conventional hire-purchase. They will come to an institution which they know offering such Islamic product. Moreover AITAB also gains support from the non-Muslims. In some institutions, 60% of their customers are non-Muslims, comprising the Chinese in majority. They can see the advantage of signing up AITAB, which is 1% penalty for late payment, as compared to conventional hire-purchase which imposes 8% penalty. Nurdianawati, 2006) Perceptions of Malaysian corporate customers of Islamic banking products and services indicated that Islamic banks were not the main choice because of the lack of knowledge. More than half of the respondents (65 %) said they had limited knowledge of the Islamic banking system. This study shows that Islamic banks have not conducted enough programmes to educate people or promote their products to the public. (Norafifah Ahmad, 2002) 10 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012They showed that 63 % of Muslim respondents possess limited knowledge of IBF. They do not fully understand the operation of IBF even though Islamic banking has been establ ished in Malaysia for more than twenty years. This factor has led to low usage of Islamic banking facilities among the Muslim respondents. (Sudin Haron N. A. , 1994). A similar situation occurred in Singapore, where only 22. 6 percent of Muslims deposit money in Islamic banks solely because of religion (Gerrard, 1997) Another important indicator determining customers’ positive or negative perception is their patronage criteria towards the service provider.In one of the earliest patronage studies on Islamic banking, Erol and El-Bdour (1989) discovered that the most important criteria considered by customers in patronising Islamic banks are provision of fast and efficient services, the bank’s reputation and image, and confidentiality. Others study found that religion is not the main factor encouraging Muslims to choose Islamic banks to hold their funds. Their findings also indicate that bank customers perceived no difference between the services offered by Islamic and co nventional banks, the former being perceived as merely duplicating the latter. Erol C. K. -B. , 1990). In addition, many of muslim also doubt of shariah permissibility on the Islamic banking instrument. (Humayon, 2004) In Malaysia, customers’ positive perception towards Islamic banking is far more crucial mainly due to the fact that Islamic banks have to compete with the long established conventional banks in a dual-banking system. Since 1983, Malaysia to date has a dual banking system, whereby the Islamic banking system operates in parallel with the conventional system.The former is currently represented by 27 banking institutions, comprising nine Islamic banks and 18 conventional banking institutions (eight commercial banks, four merchant banks and six discount houses) offering Islamic banking products and services under the Islamic Banking Scheme (IBS), also known as Islamic windows. (Bank Negera, 2005) 11 Acceptance Of Islamic Hire Purchase Facility: A Case Study among st aff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 2. 3 Competency Customers also may not to choose Islamic Hire Purchase facility for their car financing due to lack of competency among car dealers and bank officers.Most car dealer claimed there is no differences between Islamic and conventional thus give impact to costumer’s decision. The misleading view of AITAB among the customers is partly contributed by the lack of experience and knowledge among bank officers in giving correct and satisfactory explanation about AITAB. Some of these bank officers do not even understand the distinction between AITAB and conventional hire-purchase. Many proclaim that both products are similar especially with regards to its documents, procedures and governance.Hence, they are unable to highlight the advantages and benefits of AITAB as compared to conventional hirepurchase. (Nurdianawati, 2006) More competent, knowledgeable employees are more likely to design processes and deliver ser vices that conform to customer needs. (Ahmad, 2010). In addition, development of appropriate employee skills and competencies is important determinant of better service quality and favorable consumer perceptions about service delivery (Chung, 2002) Furthermore, a dealer acts as a middleman between a financial institution and a customer.In Malaysian context, the customer usually approaches the dealer first for the purpose of purchasing a particular vehicle before applying hire-purchase facility from a financial institution. In fact, the customer’s choice between conventional and Islamic financing facility depends mostly on the dealer’s explanation and recommendation. Ideally, a dealer with a high Islamic conscience proposes AITAB to the customer and able to explain how the facility works, its advantages and differences from conventional facility. However, not all dealers are equipped with in-depth understanding of AITAB facility.Thus, it is expected that they would not be able to educate their customers accordingly. In reality these dealers even tend to propose conventional facility either because their understanding of AITAB is limited or they 12 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 do not want to expose their customers to an unnecessarily complicated situation. (Nurdianawati, 2006). In addition, many dealers that are lack in understanding of AITAB facility assume the facility offered by Islamic and conventional bank are totally same.They only concern with their commission for their sales. 2. 4 Awareness. Haron et al. (1994) who pioneered in the research on bank patronage in Malaysia find that almost 100 per cent of Muslims and 75% of non-Muslims were aware of the existence of Islamic banks. Most of them wished to have a relationship with these banks if they had a complete understanding of this system. In Singapore, a study by Gerrard and Cunningham (1997) rev ealed that the Singaporeans, Muslims or non-Muslims, are generally unaware of the principles of Islamic banking.Study in Humayon (2004) shown some of the muslims may not aware of the Islamic financial instrument in the financial market. Others study on Singapore by Haron, Ahmad and Planisek (1994) revealed that only 40 percent of Muslim customers consider religion as an important factor in patronizing banks. Similarly, there is general lack of awareness of Islamic banking system among Singaporean communities, be they Muslims or non-Muslims. These results suggest that Islamic banks do not need to rely on the religious factor as a strategy in attracting customers, but they should focus more on provision of quality and efficient services.One of the contributing factors to this absence of awareness among Muslims is the lack of understanding of Islamic banking. A study conducted in Singapore showed that only 20. 7 percent know the meaning of ‘Riba’ and 31 percent know the me aning of Shari’ah. The study also showed that only 3 percent can explain accurately the meaning of Ijarah, Mudarabah 13 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 and Musharakah.Surprisingly, no one could explain accurately the meaning of Murabaha (Gerrard, 1997) Rammal and Zurbruegg (2006) found that it is important for financial institution to understand the dynamism of customer segmentation, build customer relationship and address requirement and preferences of specific segments. By doing so, it will boost up customer identification and create awareness among consumers. This finding then supported by Harun et al. (1992) where there is no significant difference between Muslims and Non-Muslims in their selection criteria.Islamic banking product used different names for their product and it has cause several difficulties and misunderstanding by customers, some claimed that it is a religious prod uct that only meant for Muslims, and some just find it too difficult to learn the names therefore they stay away (Nordin, 2001). According to them again, what is actually taught to the Malaysians since their pre-school period is aqidah and understanding of Islamic principles but little emphasis is given to the mu’amalat or the daily transaction activities according to Islam.In another study of Malaysian commercial customers and their views of Islamic financial services, Haron et al. (2002) noted that 65% of the respondents admitted to having limited knowledge of Islamic banking, while at the same time indicating that they believed the concept had good potential in the Malaysian market. Bley and Kuehn (2004) found a high level of ignorance among the 300 interviewed Muslim with regard to what constitutes acceptable Islamic finance principles. He reported that the higher the religious commitment and the lower the level of general education, the stronger the preference for Islami c over conventional finance.His study also revealed that overall; students’ knowledge of conventional and Islamic finance terms and concepts was surprisingly low among students in United Arab Emirates. 14 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 CHAPTER 3: RESEARCH METHODOLOGY 3. 0 INTRODUCTION In this chapter, it will focus on the research methodology that will use in this study. In essence, research methodology will provide researcher the needed information that guides researcher to make informed decisions to successfully deal with the problems.The information gathered could be the result of the analysis of data gathered firsthand or the data that are already available. Research methodology will presents the nature of study, data sources, pilot study and reliability test, data collection and data analysis technique. 3. 1 POPULATION AND SAMPLING DESIGN According to Sekaran, (2006), population is a complete group of entities sharing some common set of characteristics. For this research the population is among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu.This research is using sampling frame; meaning is concerned with the selection of a subset of individual from within a population to estimate characteristics of the whole population. (Malhotra, 2004) in his writing define sample frame as a lists of elements from which a sample may be drawn for identifying the target population. A sampling frame is a representation of the elements of the target population. In this research, the sampling frame is the staff at Jabatan Pelajaran Negeri Kelantan. The populations taken are 200 from 460 staff. 3. 2 SAMPLE SIZE Sample is a subset, or some part, of a large population.In research, sampling is important because the researcher intend to come up with accurate and reliable findings in order to be able use for further research. The sample size for this study is the actual numb er of subjects chosen as a sample to represent the population characteristics, which is according to Sekaran, (2006). Refer to Roscoe (1975), sample size larger than 30 and less than 500 are appropriate for most research. So, the researcher decided that the sample of 200 15 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 012 respondents is appropriate to represent the population of staff in Jabatan Pelajaran Negeri Kelantan. 3. 3 SAMPLING METHOD Sampling is the process of selecting items from the population so that the sample characteristics can be generalized to the population. Sampling involves both design choice and sample size decisions (Sekaran, 2006). The idea of sampling is to select a few samples from a bigger group known as population, so that it becomes a basis for estimating or predicting a fact, situation or outcome regarding the actual number of group under study.The method used for this study is co nvenience sampling. It is the method of drawing samples that does not impose any restrictions. This is also the least reliable sampling that is cheap and convenience. 3. 3. 1 Convenience Sampling Technique Convenience sampling refers to the collection of information from members of the population who are conveniently available to provide it (Sekaran, 2006). Meanwhile, Cooper and Schindler (2006), defined convenience sampling is non-probability sampling where researchers use any readily available individuals as participants.It is the most often used during the exploratory phase of the research project and it is perhaps the best way of getting some basic information quickly and efficiently. 3. 4 METHOD OF DATA COLLECTION In this research, the data gathered parallel to the objectives of the study. The methods of data collection that the researcher used to collect the data were primary data and secondary data. 16 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 3. 4. 1 PRIMARY DATA It is the data collected for a specific purpose from original sources.Primary data been obtained by distribution of the respondents selected. The entire questionnaires are collected personally. In this research, the primary data was collected from the personally administered questionnaire. Personally Administered Questionnaire The questionnaire has been designed according to the needs of the topic study. It is to ensure that the respondents would be fully understood and answer all the questions since there is personal administered question. In designing the questionnaire’s questions, the content, structure and appearance would give an impact to the respondents’ attitude.Thus, all these things should be properly organized. In the questionnaire designs, the researcher divided it into 3 sections which include as follows: Section A – Section A comprises questions pertaining to their personal par ticulars. The first part of the questionnaire was divided into 2 areas of information. One was on the personal information and the one on others Islamic financial product. Section B – Section B focused on obtaining information on dependent variable. It is the customer selection criteria for bank. This section is designed by using a Likert Scale.The student had to circle the appropriate response with the statement from a scale of (1-5) ranging from the caption ‘strongly disagree’ to ‘strongly agree’. Through the 5 point scale, the researcher could decide to what the acceptance of Islamic Hire Purchase facility among staff In Jabatan Pelajaran Negeri Kelantan. Section C Criteria I – Criteria I focused on obtaining information on effect of perception in acceptance of Islamic Hire Purchase facility. This section also used a Likert Scale. This scale will be 5 point 17 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 012 scale wills response of the participant toward on perception towards acceptance of Islamic Hire Purchase facility among staff in Jabatan Pelajaran Negeri Kelantan. Criteria II – Criteria II focused on obtaining information on effect of competency in acceptance of Islamic Hire Purchase facility. This section also used a Likert Scale. This scale will be 5 point scale wills response of the participant toward on competency among bank officer and car dealers towards acceptance of Islamic Hire Purchase facility among staff in Jabatan Pelajaran Negeri Kelantan.Criteria III – Criteria III focused on obtaining information on effect of awareness in acceptance of Islamic Hire Purchase facility. This section also used a Likert Scale. This scale will be 5 point scale wills response of the participant toward awareness in towards acceptance of Islamic Hire Purchase facility among staff in Jabatan Pelajaran Negeri Kelantan 3. 4. 2 SECONDARY D ATA Secondary data were obtained through searching the journal which published reported of previous researchers that different in authors, perceptions and theories. The data and information are also gathered from the website. 8 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 3. 5 THEORETICAL FRAMEWORK The research model shows that the dependent variable is the acceptance of Islamic Hire Purchase facility. This dependent variable is expected to have a significant relationship with personal characteristics, perception, competency and awareness as independent variables. INDEPENDENT VARIABLES DEPENDENT VARIABLE Perception Acceptance of Islamic Hire Purchase facility Competency Awareness Figure 3. 5. 1: The Theoretical Framework of the study.RESEARCH VARIABLES Two main types of variables that are used in this research include dependent variable and independent variable. DEPENDENT VARIABLE The dependent variable that used in this study is Acceptance of Islamic Hire Purchase INDEPENDENT VARIABLE The independent variables that are used in this research are perception, competency and awareness. 19 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 3. 6 HYPOTHESIS Hypothesis 1 (Perception) Ho: There is no significant relationship between acceptance of Islamic hire purchase acility among staff in Jabatan Pelajaran Negeri Kelantan and perception. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and perception. Hypothesis 2 (Competency) Ho: There is no significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and competency. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and c ompetency.Hypothesis 3 (Awareness) Ho: There is no significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and awareness. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and awareness. 3. 7 DATA ANALYSIS AND ADMINISTRATION Data analysis is a procedure to analyze data or information that obtains during the research. In order to achieve the research objective, the data that been obtained from the respondent must answered or fulfill the expectations.In this research, the researcher wants to measure which is the most significant criteria in acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan. 20 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 The procedure of the analysis that used is by using the SPSS 20. 0 s oftware application. All the data from the questionnaire that answered by the respondents had been analyze using this software. The process of entailing earrangement, breaching down, reduction and separation of data into as many as needed to determine their nature, relative important, functions and interrelationships. In completing this study, it will includes some basis data analysis including reliability analysis, frequency analysis, correlation analysis and multiple regression by using SPSS 20. 0 program. 3. 7. 1 RELIABILITY ANALYSIS According to Sekaran (2006), the reliability of a measure is established by testing for both consistency and stability.Consistency indicates how well the items measuring a concept hang together as a set. The reliability will ensure to test the data. Reliability is an attest to the consistency and stability of the measure instrument. The reliability of a measure indicates the extent to which it is without bias (error free) and hence ensures consistent measure across time and across the various items in the instrument. The most commonly reliability test that has used is Cronbach’s Alpha. The Cronbach’s Alpha can be interpreted as a correlation coefficient and it range in value from 0 to 1. 3. 7. FREQUENCY ANALYSIS According to Cooper and Schindler (2006), frequency distribution is ordered array of all values for a variable. In order to analyze the whole information of research question based on respondent’s profile information of the respondents such as gender, marital status, level of income and age. Frequency distribution is also simply reports the number of the responses that each questions received. It is the simplest way of determining the empirical distributions of the variables. The frequency distribution is a display of the frequency occurrence of each score value.The frequency distribution can be display is many form such as tabular and graphical form. In this study, the frequency distribution had be en measure the questionnaire in section A that it is about respondent’s profile such as gender, age, race, 21 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 religion, level of education, marital status, salary, sector and had been used any Islamic financial product. 3. 7. 3 PEARSON’S CORRELATION ANALYSIS The other name of Pearson’s coefficient of correlation is Pearson Correlation Matrix.The coefficient of correlation is used to determine the magnitude, direction and significant level of relationship between dependent and independent variables. As a descriptive technique, it is very powerful since this method indicates whether variables share is something in common with each other. 3. 7. 4 MULTIPLE REGRESSIONS The multiple regressions describe the strength of the linear relationship between two variables when one is considered the independent variable and the other is the dependent var iable (Cooper and Schindler, 2006).Regression is a powerful tool for summarizing the nature of the relationship between variables and for making predictions of likely values of the dependent variables. Regression analysis aids in understanding how much of the variance in the dependent variable may be explained by a set of predictors. For regression coefficient, estimates, model fit and R squared change are chosen in this study. 22 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 CHAPTER FOUR: ANALYSIS AND FINDINGS 4. 0 INTRODUCTIONIn this chapter, the researcher will identify the questionnaires response rate from the respondents. After collecting the data, now the researcher able to analyze and interpret it using the SPSS 20 software. Techniques using in interpreting data is by using reliability analysis, frequency analysis, correlation analysis and multiple regression in SPSS programs. These steps are impor tant to see the relationship between the variables and to know the variables are significant or not. 4. 1 FREQUENCIES ANALYSIS A frequency analysis shows the frequency of occurrence of each score value of the research data.The objective is to obtain a count of number of responses associated with different values of the variable. This analysis is appropriate and suitable to analyze the question in Section A which is respondents profile such as gender, race, religion, level of education, maritial status, age, salary, sector, used others Islamic finance product. TABLE 4. 1. 1 Frequency of Section A- Demographics’ profile Statistics GENDER AGE RACE RELIGION LEVEL EDUCATION MARITIAL STATUS SALARY SECTOR OTHERS ISLAMIC FINANCIAL PRODUCT Valid N Missing Mean Median Mode Std. Deviation Variance Skewness Std.Error of Skewness Minimum Maximum 0 1. 58 2. 00 2 . 496 . 246 -. 306 . 172 1 2 0 2. 44 2. 00 2 . 889 . 790 . 068 . 172 1 4 0 1. 05 1. 00 1 . 240 . 058 5. 207 . 172 1 3 0 1. 05 1. 00 1 . 208 . 043 4. 423 . 172 1 2 0 2. 71 3. 00 4 1. 215 1. 475 . 006 . 172 1 5 0 1. 83 2. 00 2 . 419 . 175 -1. 081 . 172 1 3 0 3. 09 3. 00 3 1. 206 1. 455 . 616 . 172 1 6 0 3. 59 3. 00 1 2. 617 6. 847 . 872 . 172 1 10 0 3. 05 3. 00 5 1. 583 2. 506 -. 021 . 172 1 5 200 200 200 200 200 200 200 200 200 23 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012Profile (n=200) Gender Male Female Age 21 – 30 years 31 – 40 years 41 – 50 years 51 years and above Race Malay Chinese Indian Religion Islam Buddha Level Education SPM STPM Diploma Bachelor Degree Maritial Status Single Married Others Salary RM 1000 and Below RM1001 – RM2000 RM2001 – RM3000 RM3001 – RM4000 RM4001 – RM5000 RM5001 and Above Sector Sektor Khidmat Pengurusan & Pembangunan Sektor Pengurusan Sekolah Sektor Pengurusan Akedemik Sektor Pengurusan & Pembangunan Sektor Pendidikan Islam Sektor Penilaian & Pep eriksaan Sektor Jaminan Kualiti Sektor Psikologi & Kaunseling Sektor ICT Other Islamic Financial Product Islamic Vehicle Financing Islamic House Financing Islamic Personal Financing Islamic Credit Card Takaful Frequency Percent Valid percent 42. 5 57. 5 15. 0 38. 5 34. 5 12. 0 95. 5 4. 0 0. 5 95. 5 4. 5 21. 0 25. 5 19. 5 30. 0 4. 0 19. 0 79. 5 1. 5 4. 5 32. 0 33. 0 15. 5 11. 0 4. 0 30. 0 14. 5 16. 0 5. 0 10. 0 13. 0 2. 5 6. 5 2. 5 25. 5 17. 0 14. 0 14. 5 29. 0 Cumulative percent 42. 5 100. 0 15. 0 53. 5 88. 0 100. 0 95. 5 99. 5 100. 0 95. 5 100. 0 21. 0 46. 5 66. 0 96. 0 100. 0 19. 0 98. 5 100. 0 4. 5 36. 69. 5 85. 0 96. 0 100. 0 30. 0 44. 5 60. 5 65. 5 75. 5 88. 5 91. 0 97. 5 100. 0 25. 5 42. 5 56. 5 71. 0 100. 0 85 115 30 77 69 24 191 8 1 191 9 42 51 39 60 8 38 159 3 9 64 66 31 22 8 60 29 32 10 20 26 5 13 5 51 34 28 29 58 42. 5 57. 5 15. 0 38. 5 34. 5 12. 0 95. 5 4. 0 0. 5 95. 5 4. 5 21. 0 25. 5 19. 5 30. 0 4. 0 19. 0 79. 5 1. 5 4. 5 32. 0 33. 0 15. 5 11. 0 4. 0 30. 0 14. 5 16. 0 5. 0 10. 0 13. 0 2. 5 6. 5 2. 5 25. 5 17. 0 14. 0 14. 5 29. 0 24 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Table 4. 2. 1 provides an exploration of the sample for the investigation.The total number of respondents was 200 and the demographic profile of the respondents is shown in table. Among the demographic profile of respondents discussed are gender, age, race, religion, level education, maritial status, salary, sector and used others islamic financial product. Respondents were 42. 5% from male group and 57. 5% of female group. From the race‘s profile, 95. 5% of the respondents are malay, 4. 0% of the respondents are chinese and 0. 5% respondents are indian. Besides that, percentages of the religion profile, 95. 5% of the respondent are Islam and followed by 4. 5% respondent are buddha. Meanwhile, in terms of level education, 21. % of the respondents are SPM, 25. 5% of STPM, 19. 5% of Diploma, 30. 0% of Bachelor and 4. 0% of Master. The majority of respondents are married which indicated 79. 5%, 19. 0% are single and followed by others 1. 5%. Reviewing on the age‘s profile, 15. 0% of respondents were in the ages between 21 – 30 years old, 38. 5% were between 31 – 40 years old, 34. 5% were the age of 41 – 50 years old and 12. 0% the age of 51 years old above. From the salary’s profile, 4. 5% of respondents were below RM 1000, 32. 0% were between RM1001 – RM2000, 33. 0% were between RM2001 – RM 3000, 15. 5% were between RM 3001 – RM 4000, 11. 0% were between RM 4001 – RM 5000 and 4. % were RM 5001 and above. Reviewing on the sector‘s profile, 30. 0% of respondents were in the Sektor Khidmat Pengurusan & Pembangunan, 14. 5% were in Sektor Pengurusan Sekolah, 16. 0% were in Sektor Pengurusan Akedemik, 5. 0% were in Sektor Pengurusan Pembangunan Kemanusiaan, 10. 0% were in Sektor Pendidikan Islam, 13. 0% were in Sektor Penilaian dan 25 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Peperiksaan, 5. 0% were in Sektor Jaminan Kualiti, 6. 5% were in Sektor Psikologi & Kaunseling and 2. 5% were in Sektor ICT. Meanwhile, in terms of used others islamic financial product, 25. % of respondent were in islamic vehicle financing, 17. 0% were in islamic house financing, 14. 0% were in islamic personal financing, 14. 5% were in islamic credit card and 29. 0% were in takaful. 26 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 4. 2 ANALYSIS OF RELIABILITY The important of the reliability of a measure is to determine the stability and consistency the questions that are distributed to the respondents. This reliability is to test the goodness of the data. Cronbach’s alpha is most common used to measure the reliability. The closer Cronbach’ s alpha is to 1, is the better.In almost every case, Cronbach’s alpha is an adequate test of internal consistency reliability. In this study, the results of reliability test are shown in the table that had separate according to each of the variables. Reliability of measure is established by testing for both consistency and stability. RELIABILITY Less than 0. 6 Range 0. 7 Over 0. 8 RANGES Poor Acceptable Good Source: Sekaran (2006) Alpha Coefficient Ranges ; 0. 6 0. 6 to ; 0. 7 0. 7 to ; 0. 8 0. 8 to ; 0. 9 0. 9 Strength of Association Poor Moderate Good Very Good Excellent Table 4. 2. 1: Ranges of Reliability 27 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 012 Reliability Analysis done when questions from all variables were well structured and can be understands by respondents. It happened and because the Cronbach’s Alpha for all variables higher than 0. 6. It means respondents answered the ques tions without bias, with consistent and stable. The closer Alpha value is to 1, the higher the internal consistency reliability. The results of all variables Reliability Analysis were shown in table below: TABLE 4. 2. 2: Reliability Output for section B – Acceptance of Islamic Hire Purchase facility Reliability Statistics Cronbach's Cronbach's N of Alpha Alpha Based Items on Standardized Items . 952 . 952 7Item-Total Statistics Scale Mean if Scale Corrected Item Deleted Variance if Item-Total Item Deleted Correlation AC : AITAB is the best choice for vehicle financing AC : Recommed AITAB contract to others AC : Will Use again AITAB contract AC : AITAB is suitable with financial planning AC : As muslim, no choice expect AITAB contract AC : Willing to switch to AITAB AC : Understanding make accepting for AITAB 23. 89 23. 92 23. 94 23. 89 23. 98 23. 92 23. 85 25. 526 25. 566 25. 619 25. 606 25. 517 26. 279 25. 860 . 871 . 864 . 852 . 844 . 853 . 742 . 829 Squared Multiple Correl ation . 803 . 795 . 812 . 806 . 744 . 591 . 730 Cronbach's Alpha if Item Deleted . 942 . 942 . 943 . 944 . 943 . 952 . 945 Based on the reliability statistics table, the Cronbach’s alpha for the 6 items show the reliability of 0. 952 which mean that this dependent variable is reliable. The result is excellent because according to Sekaran (2010), 0. 9 is excellent. 28Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 TABLE 4. 2. 3: Reliability Output for section C – Perception Reliability Statistics Cronbach's Cronbach's N of Alpha Alpha Based Items on Standardized Items . 892 . 893 6 Scale Mean if Item Deleted PR : Known about AITAB PR : AITAB different from convensional hire purchase PR : Accordance with syariah guideline PR : Good alternative to acquire assets PR : 1% penalty charge for late payment is suitable PR : Use AITAB as first choice 19. 56 19. 34 19. 24 19. 33 19. 42 19. 10 Item-Total Statistics Scale Corrected Variance if Item-Total Item Deleted Correlation 14. 570 14. 778 14. 77 16. 421 14. 788 15. 413 . 724 . 783 . 768 . 637 . 681 . 694 Squared Multiple Correlation . 615 . 716 . 689 . 426 . 550 . 574 Cronbach's Alpha if Item Deleted . 872 . 862 . 865 . 885 . 880 . 876 Based on the reliability statistics table, the Cronbach’s alpha for the 6 items of perception show the reliability of 0. 892 which mean that this independent variable is reliable. The result is a very good because according to Sekaran (2010), 0. 8 to 0. 9 is very good. 29 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 TABLE 4. 2. 4: Reliability Output for section C – CompetencyReliability Statistics Cronbach's Cronbach's N of Alpha Alpha Based Items on Standardized Items . 859 . 861 5 Item-Total Statistics Scale Mean if Scale Corrected Item Deleted Variance if Item-Total Item Deleted Correlation CM : Car d ealers inform no different between AITAB and conventional hire purchase CM : Car dealers lack of information and knowladge about AITAB CM : Car dealers only thinking their sales bonus CM : Bank officer respect your dicision to use AITAB contract CM : Bank officer give good respond on request use AITAB Squared Multiple Correlation Cronbach's Alpha if Item Deleted 15. 13 9. 983 .728 .628 .815 15. 14 10. 218 .671 .579 .831 14. 87 9. 846 .721 .548 .818 14. 93 11. 497 .645 .725 .838 14. 93 11. 597 .631 .727 .841Based on the reliability statistics table, the Cronbach’s alpha for the 5 of competency show the reliability of 0. 859 which mean that this dependent variable is reliable. The result is a very good because according to Sekaran (2010), 0. 8 to 0. 9 is very good. 30 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 TABLE 4. 2. 5: Reliability Output for section C – Awareness Reliability Statistic s Cronbach's Cronbach's N of Alpha Alpha Based Items on Standardized Items . 897 . 900 6 Scale Mean if Item Deleted AW : Know existance of islamic banking AW : Know AITAB is one of islamic finance product AW : AITAB is replace for onventional hire purchase AW : Know about 1% charge if late payment AW : Know about AITAB had been use by non muslim AW : Know about last payment in AITAB is for payment buying asset 18. 80 19. 07 Item-Total Statistics Scale Corrected Variance if Item-Total Item Deleted Correlation 17. 347 16. 538 . 660 . 753 Squared Multiple Correlation . 535 . 695 Cronbach's Alpha if Item Deleted . 888 . 875 19. 20 19. 19 19. 19 17. 005 15. 592 15. 361 .756 . 734 . 745 .656 . 592 . 629 .876 . 878 . 876 19. 38 16. 085 .714 .585 .881 Based on the reliability statistics table, the Cronbach’s alpha for the 6 items of awareness show the reliability of 0. 897 which mean that this independent variable is reliable. The result is a very good because according to Sekaran (2 010), 0. 8 to 0. 9 is very good. 31Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 4. 3 CORRELATION COEFFICIENTS Correlation analysis is used for explained whether there is an existence of association and the strength of the relationship between the independent variables (perception, competency, and awareness) towards the dependent variable (acceptance of islamic hire purchase facility). Sekaran (2006) suggested that it would be appropriated to use Pearson Correlation Matrix where it is the first issues to determine is whether the correlation coefficient is statistically significant or not significant.The rules of thumb have been proposed to characterize the strength of the association between variables, based on the absolute size of the correlation coefficient. Correlation between Are said to be 0. 8 and 1. 0 Very Strong 0. 6 and 0. 8 Strong 0. 4 and 0. 6 Moderate 0. 2 and 0. 4 Weak 0 and 0. 2 Very Weak Ta ble 4. 3. 1: Rule of Thumb of Correlation Coefficient Size 32 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Correlations Mean Of Perception 1 Mean Of Acceptance . 789** . 000 200 1 200 Pearson Correlation Mean Of Perception Sig. (1-tailed) N 200 Pearson Correlation . 789** Mean Of Sig. (1-tailed) . 00 Acceptance N 200 **. Correlation is significant at the 0. 01 level (1-tailed). Table 4. 3. 2 : Pearson Correlation Coefficient between Mean Perception and Mean Acceptance Correlation analysis is conducted to test the relationship between selection decision and service quality. The result of Pearson Correlation tests showed that there is a strong significant relationship (0. 789) between these two variables. The one-tailed significance test is p ; 0. 000 showing that the outcome of the test is not by chance, and therefore can be confidently accepted or trusted, therefore reject the null hypothesis. r(200) = 0 . 789, p ; 0. 0001, one-tailed 33Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Correlations Mean Of Competency Mean Of Competency Pearson Correlation Sig. (1-tailed) N Pearson Correlation Sig. (1-tailed) N 1 200 . 724** . 000 200 Mean Of Acceptance . 724** . 000 200 1 200 Mean Of Acceptance **. Correlation is significant at the 0. 01 level (1-tailed). Table 4. 3. 3 : Pearson Correlation Coefficient between Mean Competency and Mean Acceptance Correlation analysis is conducted to test the relationship between competency and acceptance. The result of Pearson Correlation tests showed that there is a strong significant relationship (0. 24) between these two variables. The one-tailed significance test is p=0. 000 showing that the outcome of the test is not by chance, and therefore can be confidently accepted or trusted, therefore reject the null hypothesis. r(200) = 0. 724, p;0. 0001, one-tailed 34 Acceptance O f Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Correlations Mean Of Awareness Pearson 1 Correlation Mean Of Sig. (1-tailed) Awareness N 200 Pearson . 837** Correlation Mean Of Sig. (1-tailed) . 000 Acceptance N 200 **. Correlation is significant at the 0. 01 level (1-tailed). Mean Of Acceptance . 837** . 000 200 1 200 Table 4. 3. : Pearson Correlation Coefficient between Mean Awareness and Mean Acceptance Correlation analysis is conducted to test the relationship between awareness and acceptance. The result of Pearson Correlation tests showed that there is a very strong significant relationship (0. 837) between these two variables. The one-tailed significance test is p=0. 000 showing that the outcome of the test is not by chance, and therefore can be confidently accepted or trusted, therefore reject the null hypothesis. r(200) = 0. 837 , p;0. 0001, one-tailed 35 Acceptance Of Islamic Hire Purchase Facility: A Case Stu dy among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 4. 4 REGRESSION ANALYSIS Regression is another technique for measuring the linear association between dependent and independent variables.It become as a subsequent after the correlation coefficient measure. Although regression and correlation are closely related, regression assumes the dependent variable is predicatively linked to the independent variable. The result of the Regression analysis were shown as below. Table 4. 4. 1 : Regressions – Model Summary Model Summaryb R Square Adjusted R Square . 753 . 750 Model 1 R . 868a Std. Error of the Estimate . 421 a. Predictors: (Constant), Mean Of Awareness, Mean Of Competency, Mean Of Perception b. Dependent Variable: Mean Of Acceptance 4. 4. 2: ANOVA ANOVAa Model Regression Residual Total Sum of Squares 106. 215 34. 781 140. 996 df 3 196 199 Mean Square 35. 405 . 177 F 199. 518 Sig. .000b 1 a.Dependent Variable: Mean Of Acceptance b. Predictors: (Constant), Me an Of Awareness, Mean Of Competency, Mean Of Perception 36 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Table 4. 4. 3 : Coefficient Coefficientsa Unstandardized Standardized Coefficients Coefficients B Std. Beta Error . 161 . 162 . 229 . 218 . 496 Model t Sig. Collinearity Statistics Tolerance VIF (Constant) Mean Of . 251 . 072 Perception 1 Mean Of . 229 . 055 Competency Mean Of . 522 . 069 Awareness a. Dependent Variable: Mean Of Acceptance .997 3. 502 4. 195 7. 535 .320 . 001 . 000 . 000 . 294 . 466 . 291 3. 406 2. 144 3. 437Regression analysis were employed to test the influence of three important variable of interest namely perception, competency and awareness. The r-square statistics in the model of summary is 0. 753 or 75. 3%. This implies that 75. 3% of the variation or changes in the dependent variable i. e. acceptance of Islamic hire purchase facility can be attributed to the three independent v ariables; however the remaining 24. 7% is not known and need further investigation. The significance level produced by the ANOVA table showed that the p value is less than 0. 05 implying that the model is valid and the result of the relationship is not by chance. Therefore we reject the null hypothesis.Finally, researcher found that the three independent variables, perception, competency and awareness have provided enough evidence to influence the acceptance of Islamic hire purchase facility. 37 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 4. 5 HYPOTHESIS TESTING Insignificant = Accept Null Hypothesis (Ho) / Reject Alternate Hypothesis (H1) Significant = Accept Alternate Hypothesis (H1) / Reject Null Hypothesis (Ho) P ; 0. 05 P ; 0. 05 After made several analyses to all variables for this study, all hypotheses should be discussed to determine its relevancy and whether it is supported or not. For this stu dy, Pearson Correlation Analysis was used to assess the relationship between independent and dependent variable.Hypothesis 1 (Perception) Ho: There is no significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and perception. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and perception. The result from Pearson correlation shows perception significantly has positive correlated to acceptance at the relationship (r =0. 789). Thus, significant relationship exists and the H1 accepted and reject the H0. Hypothesis 2 (Competency) Ho: There is no significant relationship between acceptance of Islamic hire purchase acility among staff in Jabatan Pelajaran Negeri Kelantan and competency. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and c ompetency. The result from Pearson correlation shows competency significantly has positive correlated to acceptance of Islamic hire purchase facility at the relationship (r =0. 724). Thus, significant relationship exists and the H1 accepted and reject the H0. 38 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 Hypothesis 3 (Awareness) Ho: There is no significant relationship between acceptance of Islamic hire purchase acility among staff in Jabatan Pelajaran Negeri Kelantan and awareness. H1: There is significant relationship between acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan and awareness. The result from Pearson correlation shows awareness significantly has positive correlated to acceptance of Islamic hire purchase facility at the relationship (r =0. 837). Thus, significant relationship exists and the H1 accepted and reject the H0. 39 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 CHAPTER FIVE: CONCLUSION AND RECOMMENDATION 5. 0 INTRODUCTIONThis chapter discusses the major findings of this study and to identify whether the finding met with the result conducted. Besides that, the researcher also gives some suggestions and ideas from the result. 5. 1 CONCLUSION In this research, hypothesis was initially tested by using the correlation coefficient to determine its significant level. From the analysis, the results indicated that all the three independent variables in the hypotheses were found to be significant at the 0. 01 level of significant at the (1 tailed). In order to substantiate the hypotheses, the multiple regression analysis was further analyzed. The R-square (R2) value of the model indicates 75. 3% of the variations explained the all independent variable whereas the remaining 24. % cannot be explained and needed further exploration in terms of other concepts which were not included in the study. As a conclusion, all the independent variables have relationship based on the correlation analysis. Awareness was the most factors determinant acceptance of Islamic hire purchase facility among staff in Jabatan Pelajaran Negeri Kelantan followed by perception and competency. 40 Acceptance Of Islamic Hire Purchase Facility: A Case Study among staff In Jabatan Pelajaran Negeri Kelantan, Kota Bharu 2012 5. 2 RECOMMENDATIONS Based on the findings result, the researcher has provided some of the recommendations for this study in order to overcome the problem faced.First of all, this research was successfully done to know the relationships between those independents and dependent variable. Perception Provide Islamic Hire Purchase facility (AITAB) information. Information about Islamic Hire Purchase facility should be easy to find by everybody because majority workers can effort to buy a car. Thus, information should be easily access by consume r in order to get a clear view about Islamic hire purchase facility. For example, Bank Negera Malaysia through website, information about Islamic Hire Purchase facility can be downloaded by anyone. Competency Training the staff Customer is

Reflection of “A Letter from Birmingham Jail” by Martin Luther King Jr.

For our honors portfolio this quarter we were required to read three documents. We, then, were quizzed over each of the readings. First, we read â€Å"Letter from a Birmingham Jail† by Martin Luther King, Jr. , then, we read the transcript of President John F. Kennedy’s inaugural address, and last but not least, we read â€Å"Millennial Makeover† by Morley Winograd and Michael Hais. Furthermore, we had to read and analyze the documents because the quizzes required us to think deeper than the written words on the paper. I believe these documents are critical because they have shaped the government and our society today.My favorite of these three documents, if I had to pick, would be â€Å"Letter from a Birmingham Jail†, not only because I admire Martin Luther King Jr. , but also because this letter is a very powerful and inspiring piece of work. Luther wrote while being confined in a jail in Birmingham, Alabama, for participating in civil rights demonstrati ons. His letter states that he will continue resisting nonviolently against racial discrimination and pleads the readers to see segregation from a different point of view. Moreover, I noticed that he quoted many people including Apostle Paul, St.  Augustine, Reinhold Niebuhr and many others.This made me realize that he most likely had the quotations memorized since he didn’t have access to those sources while imprisoned. He mentions that â€Å"injustice anywhere is a threat to justice everywhere† and that â€Å"an unjust law is no law at all† (Luther). This means that an unjust law causes harm; for example, if it is lawful to torture a certain group of people, then that is not a law whatsoever. This idea of injustice affects many directly, but also affects everyone else indirectly in the fact that prejudice is occurring around them.Furthermore, his words describe in detail what segregation was like and what people like him had to go through. This impacted me b ecause now, the idea of racial discrimination is completely frowned upon, while in the 1900’s it was something that seemed right and normal. It took years of hard work, bloody massacres, and non-stop action to obtain equality and I hate to see that a little bit of racism still exists today. The idea that immigrants are taking away jobs and opportunities that should be for U. S. citizens, surprises me because this country was founded and created by immigrants.Instead of seeing different countries and different people in one world, we should see the whole world as one, because every human being, no matter what race, has his/her own rights and should have the same opportunities that his neighbor does. Luther is one of the most charismatic and persuasive people in history and has not only inspired many, but also revolutionized a country’s view. He wrote this letter hoping to stir up some emotion and I think he got his point across in a very non-violent and mature kind of w ay that was unexpected and at the same time, admirable.His stance of a nonviolent action and the desperate cry for an end to social discrimination is as powerful now as it was 50 years ago. We now stand by these liberal values and believe the God has made us all equal and has given us certain rights that no law can take away. Although this was not an easy project, I certainly did learn something from it and it inspired me to stand up for my beliefs, but also, in a way, allowed me to see that anything is possible through hard work.

Overview of the Multiperspectivity of Gender Roles Essay

Overview of the Multiperspectivity of Gender Roles - Essay Example George Orwell’s novel, 1984, puts an indecisive light on women’s role. This paper attempts to explore the multi-perspective gender roles evident in Orwell’s novel, as well as delve in the exciting ambiguity of its feminine elements. Sacrificial Women The protagonist’s (Winston Smith) mother repetitively played the universal nature of the feminine gender -- being self-sacrificing. This sacrifice concept is commonly known to start when a woman marries (i.e., submitting herself to the husband, and using the husband’s family name) or upon conception (e.g., eating nutritious food for the baby’s consumption and not for herself). Roazen, in his essay â€Å"Orwell, Freud, and 1984† strengthened the emphasis of this woman’s role through adding the adverb â€Å"ideally† in describing 1984’s women as â€Å"self-sacrificing creatures† (section V, para. 1). Moreover, Winston explicitly expresses this through his own inte rpretation of his dream: â€Å"he could not remember what had happened, but he knew in his dream that in some way, the lives of his mother and sister had been sacrificed to his own† (Orwell 78). ... Winston goes to say, â€Å"...they were down there because he was up here...† (Orwell 77). However, no matter how saintly it sounds, reading the whole novel will expose to the readers, through Orwell’s narrative style and women’s role, how ambivalent and ambiguous women’s gender-role is. Protagonist-Effectual Though characters aside from the antagonist are used to stimulate events and the protagonist, Orwell effectively used the effectual gender-role of women to rise up that usual effectual mode. Smith pointed out the specifics: 1) Winston’s mother (i.e., her memory) â€Å"encouraged him to desire a more liberal society;† 2) his wife, Katherine, intensified Winston’s detestation of the Party; 3) Julia â€Å"triggered† Winston to finally deviate from the loathsome Big Brother and focus his intellectual pursuit to achieve freedom (1). However, one may argue that Winston’s desires, decisions, or actions were mainly the offsp ring of his rebellious nature and the feminine ‘stimulus’ was nothing but inconsequential. Yet, it is more absurd to dispense the catalytic effect the women characters had on Winston. In reality, though every person has the potential to act as such, this potential is not realized until an effective ‘pushing’ factor motivates the person. This holds true in 1984, and to argue otherwise may probably suggest the unrealistic framing of events and the useless tagging of such feminine encounters. Conformist In Orwell’s narrative, there is this evident contrast of feminine conformity and masculine rebellion. For instance, as Orwell detailed Winston’s dislike of women, since they â€Å"were the most bigoted adherents of the Party, the swallowers of slogans, the

Macroeconomics Theory Speech or Presentation Example | Topics and Well Written Essays - 500 words

Macroeconomics Theory - Speech or Presentation Example The AS curve will also shift upwards from the left margin to the right one. i. A negative inflation shock in the economy will lead to an escalation of the AS curve from the left to the right side of the graph. However, the AD curve will shift from AD1 to AD2 from the right to the left side. ii. The shifts in the AD curves from the right to the left margins of the graph will influence the new the output to reduce from the right to the left margin from Y1 to Y2 because of the reduced government spending. Therefore, the changes in G1 to G2 downwards in the vertical axis will lead to a reduction in the demand and production factors of the economy. The graph shows that the U.S economy will experience a period of in increased output in its markets because of the positive shifts in demand and supply. The positive inflation shock will lead to increased GDP and GNP following the subsequent increase in the buyers’ income levels and the marginal increase in the country’s total output. The financial crises will influence stagnation in the country’s output. It is evident that the output will be Y1 after a 3% increase in the government’s expenditure hence the prices will increase to cater for the increased level of demand in the absence of supply. b) The federal government should resolve to the use of tax cuts. The other alternative policy to restructure the country’s economy will be the implementation of price regulations that will coerce the producers to increase the output rather than the prices. c) The impact of the federal monetary policy in solving the financial crises at the short run period will lead to a shift in the production from Y1 to Y2, a factor that will influence the need for labor; hence, the employed people will affect the country’s GDP and

International Civil Aviation Assignment Example | Topics and Well Written Essays - 2750 words

International Civil Aviation - Assignment Example (Civil Aviation Training Centre, 2003) The review report is intended to build a future in which aviation exists in harmony with the natural and human environment. To make this possible the detrimental factors and strategic measures affecting the aviation industry are thoroughly analyzed for getting a better insight into the knowledge and understanding of existing and future environmental impacts, as well as the opportunities for mitigating or avoiding them.(Transportation Research Circular, 2006) Such analysis serves as an important tool in anticipating facilities and services which are required to meet the future demands of air travel and in ascertaining where and when airspace or airport congestion is likely to occur. These reviews also have a significant role in strategic planning towards the cost-effective implementation of communications, navigation and surveillance or air traffic management systems.(Trends in air transport, 2004) This review report summarizes progress that the international civil aviation industry is making towards the future. Thus the study involves There are many environmental elements, bot... Environmental factors affecting the aviation industry There are many environmental elements, both short term and long term in nature affecting the International Civil Aviation. In today's world, where aviation traffic has grown to an indispensable mode of transport, the environment has become too much stressed from a variety of sources. Population explosion has yet made the whole system more complex and difficult to manage efficiently and equitably. This paper which reviews the said sector from a strategic angle compiles from the result of researches and statistics conducted on ways to assess and provide solutions to these conditions. Use of tools like SWOT analysis, which brings to light the Strengths, Weaknesses, Opportunities and Threats of aviation industry, could be very useful in bringing out the detrimental environmental factors. The research agenda categorized the factors as in the figure (Refer Appendix - 1). (Transportation Research Circular, 2006) The main environmental constituents identified affecting the sector mainly from the Media (aircraft) and its Process (operations) are: Noise: Aircraft noise is one of the most constraining factors affecting the sector. However, there were significant developments in providing quieter aircrafts and organizations like National Aeronautics and Space Administration (NASA) and the European Community are continuously going ahead with such projects limiting noise pollution to the maximum. (Transportation Research Circular, 2006) Air quality: This deal with all the environmental impacts including emissions from aircrafts like greenhouse gas emissions, ozone acidification, depletion, and impact on local air quality. Carbon dioxide, Nitrogen oxide, etc., particulates and aerosols, sulfur compounds, and water emissions

Describe rehearsal, exercise and maintenance of business continuity Essay

Describe rehearsal, exercise and maintenance of business continuity - Essay Example In the rehearsal or exercise, there are important ingredients that need to be incorporated, according to the proposed exercise checklist, to wit: (1) clarity of objective and format of the plan; (2) budgets and approvals that were obtained; (3) facilities that are specifically identified to be needed; (4) design of alternative scenarios for the exercise process; (5) proper documentation before and after the scheduled exercise; (6) actual exercise activity; (7) learning outcomes; (8) advisory to stakeholders; and (8) revisions of portions where risks have been identified (Credibility, Rehearsals, Exercising, Audits of Plans and Risk Decision-Making, 2014). Maintenance is another relevant component in terms of keeping the plan updated, in the light of new developments, resources, or participants who need to be apprised and oriented. As emphasized, â€Å"organizations, its people, and environments are continually changing† (Credibility, Rehearsals, Exercising, Audits of Plans and Risk Decision-Making, 2014, p. 12). The review process, per se, was recognized as part of the maintenance component. Benchmarking is defined as â€Å"a measurement of the quality of an organizations policies, products, programs, strategies, etc., and their comparison with standard measurements, or similar measurements of its peers. The objectives of benchmarking are (1) to determine what and where improvements are called for, (2) to analyze how other organizations achieve their high performance levels, and (3)to use this information to improve performance† (Benchmarking, 2014). Applying this measurement tool in business continuity plans, benchmarking reviews the plan’s components, structures, objectives, and processes in the light of similarities or disparities with other plans and to incorporate any component that is deemed pertinent for the current organization’s

Porter s 5 forces analysis and a life cycle analysis - why is the Assignment

Porter s 5 forces analysis and a life cycle analysis - why is the Australian Car Manufacturing Industry closing down - Assignment Example Although global and local economic conditions have played a major part in the death of the manufacturing industry, blame has also been placed on the many parties and factors involved. By studying the current state of the industry and using porter’s five forces analysis, we can better discern as to what the main drivers were that caused the ultimate death of the Australian automotive manufacturing industry. The Australian car manufacturing industry has become far too small to be sustainable for any particular manufacturer. Australia’s three car manufacturers Holden, Ford and GM all announced they would shut down their local manufacturing operations within nine months of each other. With the local economy facing harsh times it seems that with current size of the market and increased competition from imports has simply gotten too small to be profitable. As a matter of fact, the size of the market had gotten so small that all three companies began to rely on each other just to survive and stay afloat. It has been a long time coming, the death of the Australian auto manufacturing industry. Although, there have been many interrelated reasons that have caused the slow demise of the industry many individuals put the most of the blame on the federal government. It has been blamed for much of the troubles that have negatively affected local manufacturers from their low import tariffs. Many of the federal government initiatives such as their Free Trade Agreements with China and India, low import tariffs, and the controversial automotive financial bailouts have created an industry that cannot sustain itself. Others place the blame to the car manufacturer themselves that used the Australian government like their own piggybank to bail them out financially. Additionally, the federal government and their economic policy itself have created a nation with relatively high wages, strong currency coupled with the extremely low

Strategic HRD and HRM Essay Example | Topics and Well Written Essays - 4250 words

Strategic HRD and HRM - Essay Example Each cupboard is a complex ensemble of fume extraction units, plumbing, and electrical systems to be designed and fitted. Each cupboard is unique and requires flexibility and an attention to detail within the manufacturing process to suit client’s customization needs. The company delivers bespoke fume-cupboards to customers gate but does not get involved in its installation. The Company consists of 220 personnel, 175 of them work on manufacturing process-the core process. Balance of 45 personnel work in the sales department, design department and the support function. Support functions include payroll, accounts, HRM, and administration. HRD problem as identified in company structure appears to be the fact that HRM function is small and inadequately staffed within the company. Further evidence in the case reveals that this function is not able to achieve its objectives to a very large extent. Similarly, sales and design departments appear to be under Staffed.The Company has cor e operations in the manufacturing process in which 80% of employees are deployed. It comprises of several functional sections like the sheet metal cutting and folding for the cupboards, protective coating application, initial assembly, plumbing, and electrical sections. The first HRD/Organizational problem identified in core operations appears to be a loose span of supervisory control over laborers. Assuming 4 supervisors per functional section, we have about 20 supervisors in 5 sections and 155 laborers under such supervisors. Each supervisor on an average has about 8 laborers under him. The second problem relates to very high labor turnover on manufacturing shop floor. This disturbs the supervisor span of control further which is already high at 8 laborers and possibly obstructs the product customization process leading to defectives and quality deficiencies. Moreover, quality control function at the company is very weak too.

Assignment 6.26 Example | Topics and Well Written Essays - 500 words

6.26 - Assignment Example The find it difficult to live in between two pay checks. Thus it is found that as per the theory of intersecting forms of dominion some get to live a harder life while others live a good life. According to the matrix of dominion it is stated that the experience of people regarding race, class gender and sexuality is different and dependent upon the social location of the people in the structures of race, class, sexuality and gender. In the example of waging a living it is therefore found that the 4 peoples who are talked about belong to different race, gender and color of skin. However all of them face the same difficulty when it comes to running their daily lives based on the wages that they earn. These people of different age groups and different levels of work are linked by the fact that despite working hard for living they feel that they are hustling backwards. The forces that are at act in waging a living are at one hand the forces that are acting towards the oppression of people on one hand and the determination and will of people on the other hand that is forcing or urging them to continue the fight. However the way they fight is different. However all of them have one thing in common and this is related to not resigning to their fates. There are various institutions that have an impact on the lives of the people. One is the government and its role in providing subsidy, then there are educational institutions that shape careers and determine the level of jobs which one gets and then there are unions through which people strive for a better living. The concept refers to the fact that there are multiple practices which leads to the creation of differing and unequal situations in relation to access and control over the means that are related to provisioning and survival (Acher, 2006). For example in the case of Barbara Brooks it was found that as

Economics of Competitive Advantage Essay Example for Free

Economics of Competitive Advantage Essay A globalized economy in its theory entails opening up of the local economy of a certain country towards internationalization, creating a â€Å"borderless world economy†. Thus, ideally, it should pave the way for economic interdependence and promote economic fair play amongst participating countries. Globalization shall surely expose an economy towards the world market due to increased amount of global trade and exchanges in products and services and by encouraging application for an open-economy. Globalization has imposed too many changes on the international monetary policies. On the other hand, international monetary has seriously influenced trade and investment policies, finance, tourism and many other aspects that are coincided with the modernity imposed by globalization. Moreover, open-economy principles have profoundly affected exchange rate policies on the macro level. Thus, international economic migration has increased exposure towards international financial changes and commercial flows. (Frieden, p. 1) Moreover, according to Betts and Kehoe (2004), the aggregate real exchange rate movements are believed to be influenced by inter-country movements with regards to the relative prices of their traded goods within countries. Also, the currency denomination of international trade widely influences the trade prices of goods and services. Thus, it also turns out that changes or fluctuation in the on currency will decrease the buying power of a particular currency if compared to other currencies that have less amount of fluctuations in their market. In addition, the strong market competitors in this case, are those who are believed to have strong economic relations with participating countries, thus they carry an edge towards their trade practices. Nevertheless, they don’t act to stabilize world exchange rates, rather they only work to provide balance of trades and multi-lateral interaction amongst participating nations. There are several factors that affect the bilateral rate movements which have significant economic effects. According to the Reserve Bank of Australia Bulletin (RBAB) (1998, p. 2) These are: (1) divergences between export and import and aggregated trade-weighted exchange rates; (2) role of US dollar as currency for international trade; (3) longer-term pricing of commodity exports in terms of other major currencies; and (4) importance of bilateral rates vis-a vis competitor countries with relatively little direct trade. These changes however, the depreciation or appreciation can create effects on international competitiveness. Moreover, aside from purely economic reasons of rate fluctuations, the political side behind changes in the market activity is also significant. This political-economic aspect is important most especially amongst developing nations. The emergence of developing countries and the continuing influence of strong countries amongst less empowered countries create domestic and international political pressures that are integral to the competitiveness of the participating countries (Freiden, p. 12) Thus, economically speaking, exchange rate fluctuations have impacts on the country’s competitiveness. Stability or non-stability of their currency has adverse effects on the currency’s buying and trading power. On the political aspect, excluding the changes and fluctuations in the currency rates, powerful groups and powerful consumers affect international economic integration. And thus the openness of world economy therefore pushes more politicized movements and political pressures in the economic arena.

History of the Public Smoking Ban

History of the Public Smoking Ban The emergence of public smoking ban can be backdated to 1590 when Pope Urban VII threatened to excommunicate anyone who took any form of tobacco inside a church. Afterwards other European cities enacted smoking bans. Modern, countrywide tobacco ban was imposed in Germany during the rein of Adolf Hitler. In the sunset years of the 20th century, second-hand health related risks of tobacco smoking became more publicized. Coupled with restrictions on cigarette advertising and fear of revenue losses, the tobacco industry embarked on campaigns aimed at â€Å"tolerance and courtesy† to reduce the heightened tension between smoker and non-smokers, whilst eluding issues related smoking ban. Over the years, laws implementing bans on outdoor smoking have been enacted by many countries in various ways. The Irish government became the first country to do so. In one form or another, is also has been enacted in countries such as USA, Norway, Netherlands, Romania, Sweden, South Africa, United Kingdom and Australia. The World Health Organization (1997) survey on tobacco control policies reported that a vast majority of countries numbering to 134 now have some form of restriction on smoking in public places. The underlying explanations cited for smoking bans in public places has often been safeguarding of the society from the its detrimental effects, which include increased risks of cancer, heart disease, and other acute and chronic diseases. The implementers have often put forward scientific evidence showing that tobacco smoking is harmful to the smokers and to those inhaling second-hand smoke. Air quality has often been advocated by the public one of the advantages of smoking ban. For this reason, the basis for smoking ban rationale relates to normative economics. Normative economics entails value judgements about â€Å"what the economy ought to be like† or what particular policy measures ought to be undertaken to achieve a desirable objective. Since normative economics looks into the appropriateness of particular aspects of the economy, it advocates for economic policies. In this case, the value desirable goal aims at reducing health care costs and improve productivity and create job opportunities, reduced risk of fire, cleanliness in places where food are handled, potential cutback on energy (decreased ventilation needs), reduced quantities of litter, make it easier for smokers to quit, and to promote healthier environments. Although restrictions attributed to smoking ban are primarily intended to reduce exposure to second hand smoke, it is most likely that there will be a reduction in smokers opportunity to indulge. This may lead to significant reductions in cigarettes smoked and consequently the â€Å"cost of smoking† Chaloupka and Warner (2000). In particular will be the smokers working or mostly spend most of the time within the Central Business District (CBD) of Nairobi where the smoking ban law is stringent as compared to the suburban. In Ireland, for example, it is said that approximately 7,000 smokers are thought to have quit in the first six months after imposition. What does this imply? First of all it is essential to acknowledge that cigarettes as products have inelastic demand. Tobacco is the raw product for cigarettes and contains nicotine an addictive substance that has no close substitutes. According to Curbing the Epidemic (The World Bank, 1999), elasticity of cigarette ranges on an average of (-0.4) though it varies from region to region, and from study to study. With this simple observation, it therefore implies that the total quantities of cigarettes consumed by each individual ‘continuing smoker will decline, ceteris paribas. This means, that there was an inward shift in demand for cigarettes after the implementation of the ban. Figure 2 demonstrates this implication of shift in demand. Before the enactment of the smoking ban, the consumers demand curve was D1 and the amount spent totaled to Kshs. 100.00 as depicted by the shaded area (OABF). After the enactment, the demand shifted to D2, hence the consumer total expenditure was Kshs. 50.00 as shown by the area (OACE). Economists have often referred to this phenomenon as non-price measures to reduce demand on cigarette. The imposition of smoking ban in the proximity of Kenyas county councils and municipalities includes all workplaces (private and public), businesses and public places (indoor and outdoor) with the exception of restaurants which have been obliged to designate special smoking zones. In the Nairobi for example, there are only three spots in the Central Business District (CBD) allocated smoking zones which do not sufficiently address the needs of all smokers. This ban comes in at the time when the tobacco manufacturing industry BAT Kenya Ltd. has been pushed to a threshold level as a result of tough regulation on advertisement campaign. What will the consumer do with the rest of the money saved? Since the consumer will be saving Kshs. 50.00, daily it will sum up to Kshs. 1,500.00 per month. This would definitely affect the cigarette position on the consumers budget line, assuming the income remains the same. In the Neoclassical economics, the goal of consumer behavior is utility maximization (consistent with maximization of net benefits). This means that the marginal utility of the last Shilling spent on the last cigarette will be equal to the marginal utility of the last Shilling spent on any ‘other good (equimargin principle). To get a better picture of this situation, let assume the following: Before smoking ban After smoking ban Income Kshs.30,000Kshs.30,000 Expenditure on cigarettesKshs. 3,000Kshs. 1,500 Amount spent on others Kshs.27,000Kshs.28,500 Table 1: Cigarette smokers budget before and after ban Figure 2 shows the smokers (consumer) budget line. Since the consumer is constrained by it the budget line, the new law will results into an outward movement along the budget line of the expenditure dedicated to smoking relative to what is spent on others. The implication is that the extra money derived from the reduction of smoking will be substituted and spent on others. This may at times result into some level of decrease in demand for inferior goods. Maybe the smoker will buy a gift for his wife or girlfriend, some items for himself, indulge in other activities such as beer drinking to divert from the affects of the smoking ban. In an interesting scenario would be where the consumer will be end up spending on expensive cigarettes since the consumer may want to maximize on utility. The smoking ban carries along with it requirements that the hospitality sector (hotels, casinos, bars and restaurants) has to designate regions for smokers and non-smokers. In addition it would be a not be a surprise to observe â€Å"no-smoking† and â€Å"smoking† related signs in these places. This will have a twofold effect which can also be viewed from the point of opportunity cost of smoking on businesses (due to the fact that the new decree is at times not adhered and may be up to the business to decide despite them knowing of the legal risks involved). One will be on the businesses that will follow the decree. These businesses may benefit from the fact that they may not lose on some non-smoking clientele base, but lose on some smokers who may avoid these places due to the pinching effect of the ban. The second would be businesses that would not completely adhere to the decree and may loose on clientele that may not appreciate the fact that they are not being ackno wledged, but gain from smokers who may feel that they are not being restricted. In general, economic loss will be experience in varying businesses in the hospitality sector. These include: The imposing of smoking ban will reduce pollution causing activities since the polluters, that is, smokers will be affected. This will result into increased levels of purified or cleanliness of the air. Unfortunately this does not come free. In economics any improvement linked to the environment has both benefits and costs to the society. There exists a trade-off between how much improvement is gained and how much money is used. This can be demonstrated by bringing together marginal benefits and marginal costs into one figure to provide some indication of the exchange and determine how socially efficient is the environmental improvement. What economists term as the socially efficient quantity of pollution† means that social benefits will be maximized when pollution is reduced to a certain point. Unfortunately, too much pollution reduction is too costly for us to undertake. In the case of smoking ban in Kenya, net social benefits can be determined by the difference between total benefit (TB) and total cost (TC): Why? For example in the demand and supply curve, consumer surplus is can be determined by the area above the market price (equilibrium) and below the demand curve, which is similar to our case above. The implications would be that there will be a positive social benefit as results of smoking ban and clean air due to movement from MC1 to MC2 This law will entail some long term implication in that it will prevent the youth from smoking at an early stage, as there will be lesser number of people exposed to the perils of smoking. Hence this will greatly benefit the society in terms of reduced levels of current and mostly essentially, the future generation. Furthermore, restrictions on smoking may change the perceived norms related to smoking by changing attitudes concerning the social acceptability of smoking (U.S. Department of Health and Human Services, 1994). Evidence has shown that hospital admissions related to heart attacks the cases of dropped due to enactment of the ban. For example, after the smoking ban was imposed 2003 in Pueblo, Colorado USA heart attacked cases dropped by 27% while neighbouring towns where the ban was not introduced showed no change. Also a survey conducted in Scotland showed that smoking ban has some positive impact on health. The research revealed that massive health gain as a result of smoking ban. So not only will individual Kenyan smokers benefit in terms of better health (since some would quit while the continuing smokers will reduce indulging) but also potential second hand smokers (such as bar workers and those who spend considerable time with the smokers). Net social benefit (NB) = Total Benefit (TB) Total Cost (TC) NB = TB TC In economics, â€Å"net benefits are maximized where marginal benefit equals marginal cost (MB = MC)†. The same applies for socially efficient point that occurs where MB = MC and the point where they interact (MB and MC), maximum net social benefits is realized. This is demonstrated in figure 3 where as a result of the imposition of smoking ban MC1 shifts to MC2, causing the equilibrium to change from E1 to E2. Since smoking ban results to E2, then net social benefits is computed as: NSB = A + B + C C NSB = A + B Loss of revenue Loss of actual employment A decline in wages and salary payments Besides the cigarette manufacturers, the impact of a ban is expected to trickle down the industry chain. This includes the tobacco farmers. In Kenya, there are 300,000 farmers involved in growing of tobacco leaves, which means that there would likely be a reduction in revenue on their side. This will result into some of them halting the growing the tobacco leaves and looking for other substitution to their farming. The fear of being phased out is another determining factor on the future volumes (tobacco leaves) produced unless the tobacco industries takes alternative measures to increase it foreign exports and counter local market situation, hence ensure no decline in local quantities of tobacco leaves demand. It is obvious that the reduction of health risks will result into less expenditure that the government will spend of health care in the long run. This ensures improved productivity which will boost the production possibility frontier (PPT). Others benefits to the government include gains in terms of less energy used for ventilation needs and possibilities of increased investment. One would expect that the government revenue would be reduced from the drop in taxes gained from the manufacturing industries, tobacco farmers and the hospitality. Unfortunately this does not seem to be the case. In June 2007, a month before the enactment of the ban, the Kenyan government increased the â€Å"Sin-Taxes†. It seems that the government had counter measures of reducing any chances of future loss of revenue in anticipation of the ban in Junly 2007. For this reason, then it appears that the stakeholders (smokers and related industries) took the overall burden. However, the government will need to create more job opportunities for loss in employment. In addition, government will have to give subsidies to tobacco farmers since the new law will reduce their income and discourage them to continue farming. Since cigarettes contain the addictive substance called nicotine, some smokers may not be able to eventually quit. This may prompt the government to initiate surrogate smoking programs such â€Å"smoking cessation†. One would expect that the new law will impact on the valuation of the tobacco industries. This is definitely true since there was an initial drop in the stock price of BAT stock in the NSE immediately after the ban was enacted. According to The East African, it is estimated that the BAT stocks in the NSE lost Ksh3.5 billion ($48.6 million) in a period of one year. BAT share prices dropped from Kshs. 200 per share to Kshs. 165.00, the lowest during that trading period. In spite of this, today, the stock price has stabilized. This can be owed to the fact that the short run production was affected which led to market speculations of the uncertainty of the BAT in the long run. However, BAT did take counter measures of expanding its foreign market hence giving assurance of long run. Currently, according to Business Daily, so far the BAT shares at the NSE have been stable despite further series of smoking bans by other local authorities. This is consistent with economics of production wher e all the fixed factors of production are variable in the long run hence ensuring some level of return to scale just as BAT has done to ensure it stays in production. Contrarily, in the short run, a firm is only able to change the variable factors and not fixed factors just as the stock prices of BAT reflect in short run versus long run.