| dc.description.abstract | This study sought to investigate the impact of cost of capital on the investment decision
of non-financial firms listed at the Nairobi Securities Exchange It explores the
interdependence of cost of capital and investment decisions by documenting the
relationship between corporate leverage and investment choices. By using the data of
non-financial companies listed in Nairobi Securities Exchange for five years (2008-2012)
as the sample, the obtained data was filtered to obtain the relevant statistics that could be
analyzed through SPSS. The analysis was done by applying multivariate regression
analysis and t-test.
The study found that there was a significant likelihood of a firm elevating-leverage to
increase the company value. The result revealed that investment decision had influenced
positively on the company value, which meant the investors assumed the management
had performed well in searching and investing the obtained capital from debt. The
research findings indicated that there was a weak positive relationship (R= 0.332)
between the variables. The study also revealed that 10.40% of cost of capital of the firms
listed at the Nairobi securities exchange can be explained by the independent variables.
The results are in line Ojah (2009) who by using a panel of listed firms in Ghana, Kenya,
Nigeria, South Africa and Zimbabwe found that the firms’ profitability, size, asset
tangibility and age, related significantly to leverage | en_US |
