FACULTY OF ECONOMICS AND BUSINESS

DEPARTMENT OF ACCOUNTING AND FINANCE

GROUP ASSIGNMENT 5

EBQ2054
RESEARCH METHODOLOGY ECONOMICS & BUSINESS

METHODOLOGY DATA PROCESSING (PART 2)

THE EFFECTS OF FINANCIAL DISTRESS AMONG UNIMAS STUDENTS

SUBMITTED BY:
No. Group Members Name Matric No.
1 CHRISTINUS NG KA HING 40922
2 DALJEET KAUR A/P GAG JIT SINGH 40983
3 MOHD SYAFIQ BIN WAHID 42285
4 NUR DJUITA BINTI JAMALUDDIN 43089
5 NURUL NATASYA BINTI AZLY 43603
6 SULAIMAN BIN MOHD FAISAL 44274

LECTURER : MADAM SALAWATI BINTI SAHARI

DATE : 03 MAY 2017
 Table of Contents

1.0 Data level of measurement ....................................................................................................... 2

1.0.1 Nominal ....................................................................................................................2

1.0.2 Interval ......................................................................................................................3

2.0 Data Processing ......................................................................................................................... 4

2.1 Data Analysis ............................................................................................................................. 4

2.3 Reliability Analysis ................................................................................................................... 4

2.4 Descriptive Analysis ................................................................................................................. 4

2.5 Descriptive Statistics ................................................................................................................ 5

2.5.1 Measures of Frequency ..............................................................................................5

2.5.2 Measures of Central Tendency...................................................................................7

2.5.3 Measures of Dispersion or Variation ..........................................................................8

2.5.4 Measures of Shape .....................................................................................................8

3.0 Inferential Statistics ................................................................................................................... 9

3.0.1 Pearson Correlation ...................................................................................................9

3.0.2 Multicollinearity ........................................................................................................9

3.0.3 Multiple Regression Analysis .................................................................................. 10

4.0 Justification of Analysis.......................................................................................................... 12

References ........................................................................................................................................... 13

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1.0 Data level of measurement

In this study, we have chosen two levels of measurement for 4 of our independent
variables which are nominal and interval. The following section will explain each level of
measurement thoroughly. Also, measurement for the other 2 of our independent variables will be
explained at the end of this section. These levels of measurement can be seen in the sample of
questionnaire that had been attached in Methodology: Part A.

1.0.1 Nominal

The purpose of numerical values in nominal measurement is just to name the attribute
accordingly regardless of rank or ordering. In conjunction with this research, nominal
measurement is used in Section A: Demographic Information (refer the image below) of the
questionnaire to indicate the personal information of the respondents without revealing who they
are. Nominal scale is used in labelling symbols without any quantitative value. Nominal scale is
mutually exclusive and does not have any numerical significance. This level of measure will be
used in both Section A and Section B of the questionnaire. Some information is required in this
section such as gender, year of study, faculty and age. This kind of information helps researchers
to classify respondents according to their demographic information and ensure that the result is
not biased. Refer to Table 1.

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1.0.2 Interval

Interval measurement is used in almost 60% of the questionnaire. Interval measurement

lets the researchers know the actual feeling of the students without having the respondents to
spend time on making a paragraph to answer the question. Interval measurement is used in 4
variables over the 6 existing independent variables in this study. Those 4 independent variables
that are using interval measurement are peer pressure, tuition fees, debt loan, and financial
planning and awareness.

Strongly Slightly Strongly

Moderate Agree
Statements Disagree Disagree Agree
1 2 3 4 5
rd
PEER PRESSURE (3 Independent Variable)
I tend to emo on buying decision 1 2 3 4 5

Table 2: Interval Measurement on variable

As for the other 2 variables which are unavoidable expenses and lifestyle, the data are
obtained by using open ended questions. Hence, the 4 levels of measurement are not applicable
and another detailed analysis throughout the responses will have to be done as well as coding the
information into the system to find the exact finding.

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2.0 Data Processing

As the population of UNIMAS students is 16,489 in accordance to Fact and Figures

updated by UNIMAS Official Site, the calculation resulted in 376 minimum sample sizes. In this
study, the confidence level is determined to be at 95%. Therefore, 405 set of questionnaires will
be distributed to 9 faculties in UNIMAS and each faculty will be getting 45 set of questionnaires.
The data collection from respective respondents (UNIMAS students) will be analyzed and
processed using Microsoft Excel.

2.1 Data Analysis

The data collection from the questionnaires distribution will be processed using
Microsoft Excel. The objectives of data analysis include measuring central of tendency and
variability, testing reliability and the hypotheses developed for the study (R. Coe, 2002). It is
important to prevent error that may invalidate the findings or conclusions.

2.3 Reliability Analysis

Reliability analysis is tested by using Cronbachs Alpha to verify the precise and upright
results out of scale. It is most commonly used to see if questionnaires with multiple Likert scale
questions are reliable. Alpha coefficient ranges in value from 0 to 1 and may be used to describe
the reliability of factors extracted from dichotomous and/or Likert scale questions. In general, a
score of more than 0.7 is considered acceptable.

2.4 Descriptive Analysis

Data analysis enables describing and comparing variables numerically which enhances
the statistical analysis and data interpretation (R. Coe, 2002). Mean, median and mode are used
to measure the central tendency while standard deviation, variance and skewness are used to
measure variability of the data. According to Zikmund (2003), all data from the questionnaires

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could be interpreted and summarized in average, frequency distribution and percentages
distribution. Univariate analysis is conducted which involves the examination across cases of one
variable at a time.

2.5 Descriptive Statistics

R. Coe (2002) uses descriptive statistics to provide data descriptions of the population,
either through numerical calculations or graphs or tables. Descriptive statistics is a generic term
for statistics that can be used to describe variables and quantitatively described or summarized
features of collection of information or data. Together with simple graphic analysis, they form
the basis of virtually every quantitative analysis of data. Descriptive statistics help in simplifying
large amounts of data whereby each statistic reduces bigger data into a simpler summary.
Characteristics of a single variable examination include the distribution, central tendency of
distribution, such as mean, median and mode averages, and the dispersion which commonly
measured by the range and standard deviation.

2.5.1 Measures of Frequency

The data collections from the questionnaires distribution are used to measure frequency
distribution for each independent variable on this research. Information on demographic and
social characteristics are obtained using descriptive statistics, means, medians and standard
deviations for continuous variables and frequencies for categorical variables. Cross tabulations
are conducted among variables. Demographic profile of sample and factors contributing to
students distress are depicted as tables below. Frequencies and their percentage are defined in
the tables to make a clearer view of findings.

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 Table 3: Respondents demographic characteristics

Frequency
.Description Categories %
(n=405)
Gender Male
Female
Year of study Year 1
Year 2
Year 3
Year 4
Year 5
Faculty FEP
FK
FSGK
FSKPM
FPSK
FSS
FSTS
FSKTM
FPBPK
Age 18 - 20
21 - 23
24 - 26
27 - 29
30 - 32
33 - 35
Table 4: Descriptive for peer pressure

Strongly Strongly
Disagree Moderate Agree
Peer Pressure Disagree Agree
F % F % F % F % F %
I tend to emo on buying
decision
I tend to spend a lot in the
presence peer
I spend more than the
peer
I was not influenced by
peer pressure
I was influenced by peer
decision making

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2.5.2 Measures of Central Tendency

The data collections from the questionnaires distribution are used to measure mean,
median, and mode. These measures of central tendency are measures of the location of the
middle center of a distribution.

In analyzing Likert response items, researcher must understand the measurement scale
represented by each. Likert scale data are analyzed at the interval measurement scale.
Descriptive statistics recommended for interval scale items include the mean for central tendency
and standard deviations for variability. The mean score on each item is used to determine the
highest and lowest factors contributing to students stress level. Additional data analysis
procedures appropriate for interval scale items would include the Pearsons r, t-test, ANOVA,
and regression procedures. Independent sample t-test is to determine if any differences existed,
and the t-value to determine if any significance existed between the independent variables at the
p5% confidence level (alpha=0.5). Pearson coefficient is used to examine the relationship
between two variables, but both variables being continuous in nature. The Pearson correlation
can range from -1 to 1. A positive correlation is present if variables change in the same directions,
while negative correlation is present if variables change in opposite directions. Table 3 provides
examples of data analysis procedures for Likert scale data.

Table 5: Suggested data analysis procedures for Likert scale data

Measurement Likert Scale Data

Central tendency Mean
Variability Standard deviation
Associations Pearson correlation (r)
Other statistics ANOVA, t-test, regression

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2.5.3 Measures of Dispersion or Variation

The dispersion or variation gives information about the spread of the scores in each
distribution. It is especially helpful when data are normally distributed. The common measures
of dispersion are variance, standard deviation, coefficient of variation, range, percentiles and
quartiles. Standard deviation is a more accurate and detailed estimate of dispersion because an
outlier can greatly exaggerate the range. It shows the relation that set of scores has related to the
mean of the sample.

2.5.4 Measures of Shape

An important aspect of the description of a variable is the shape of distribution which

tells the frequency of values from different ranges of the variable. Simple descriptive statistics
can provide some information relevant to how well the distribution can be approximated by the
normal distribution. The data collections from the questionnaires distribution is used to
determine whether the research is at the curve level of normal skewness distribution, positive
skewness distribution or negative skewness distribution. Besides, data also is used to identify the
kurtosis (peakedness) which how concentrated data are around a single value, as measured by the
kurtosis index. Three degrees of kurtosis are displayed as leptokurtic, platykurtic, or mesokurtic.
Researcher needs to achieve the kurtosis of the normal bell curve because then the data is more
reliable.

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3.0 Inferential Statistics

Inferential statistics use a random sample of data taken from a population to describe and
make inferences about the population. Inferential statistics are valuable when it is not convenient
or possible to examine each member of an entire population. Its also to determine probability of
characteristics of population based on the characteristics of the sample and help to assess
strength of the relationship between independent variables and dependent variables. Inferential
analysis is used to test the hypotheses developed for the research by investigating the
relationships between the six independent variables (unavoidable expenses, lifestyle, peer
pressure, tuition fees, debt loans, financial planning and awareness). The inferential analyses
included are Pearson Correlation, Multi-collinearity and Multiple Linear Regression.

3.0.1 Pearson Correlation

Pearson correlation is a statistical test for finding the linear relationship between two or
more quantitative variables (Subhani, Osman, Saad, & Mir, 2013). Therefore, the relationship of
independent variables and dependent variable is measured via Pearson Correlation. The
significance level is 0.05 in the Pearson Correlation test, which means there is 95% if confidence
level. Therefore, the hypotheses only can be accepted if the significant p-value is less than 0.05
(Zeng & Gu, 2017).

3.0.2 Multicollinearity

Multicollinearity is a state of very high inter-correlations or inter-associations among the

independent variables. It s therefore a type of disturbance in the data and if present in the data
the statistical inference made about the data may not be reliable. Multi-co linearity also can
describes a condition that may appear when analyst simultaneously consider more than one
explanation for a social outcome. this happen when two or more of explanatory variable in
sample overlap. This is because when overlap, method of analysis cannot fully distinguish
explanatory factors from each other or isolate their independent influence. There have 2 type of

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multi-collinearity and partial multicollinearity. Accordings (Berry and Feldman (1985), 38).
Otherwise, in generally result shown that some kind of simple error in the data handling or
model specification, one of that thing is easy to diagnose and painless to address. The Partial
Multicollinearity is use of overlapping variable that still exhibit independent variation. In other
words, multicollinearity is a matter of degree and it is not a problem that does or does not appear
(Harvey 1977).

Symptoms of multicollinearity may be observed in 3 situations:

a) Small changes in the data produce wide swings in the parameter estimates;

b) Coefficients may have very high standard errors and low significance levels even though
they are jointly significant and the R2 for the regression is quite high;

c) Coefficients may have the wrong sign or implausible magnitude (Greene 2000: 256).

Multi-co linearity has following consequences.

a) Variance (SEE) of the model and variances of coefficients are inflated. As a result, any
inference is not reliable and the confidence interval becomes wide.

b) Estimates remain BLUE, so does R2

c) R2yx1....xk < r2yx1 + .... r2yx1.

3.0.3 Multiple Regression Analysis

Multiple regression analysis is conducted to determine the relationship between several

independent variables and one dependent variable by calculating the coefficient of multiple
determination and regression equation (Jaccard, Guilamo, Johansson, & Bouris, 2006).
Practically, multiple regression analysis provides an understanding on whether there is a
relationship exists between the independent variables and dependent variable, how strong the
relationship is, whether the relationship is positively or negatively skewed and the proper way to
describe the relationship.

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The strength of the relationship between independent variables and dependents is determined by
the coefficient of determination (r) as it measures the proportion of the variation in a dependent
variable that can be explained by the independent variables. In other words, how well the
financial distress among UNIMAS students (dependent variable) can be explained by the
unavoidable expenses, lifestyle, peer pressure, tuition fees, debt loans, financial planning and
awareness.

There is a hypothesis technique that called ANOVA was used by the researches to test whether
there is significant variance in means occurs between three or more groups. In other words, it
evaluates if there is a difference among the means of the group. This test must have dependent
variable in metric which financial distress in this case. The following formula is known as F-test
which is used to determine the degree of variability in the scores of one sample to the score of
another sample.

The following equation is formed to determine the statistical significance of each independent
variable on the dependent variable.

Equation Y = a + bX + bX + bX + bX + bX + bX

Where,
Y = Financial distress among UNIMAS students
A = Fixed: equal to Y when b, b, b, b, b, b=0
b, b, b, b, b, b = Slope of regression line
X = Unavoidable expenses
X = Lifestyle
X = Peer pressure
X = Tuition fees
X = Debt loans
X = Financial planning and awareness

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4.0 Justification of Analysis

Descriptive analysis is chosen as the method in analyzing the data collection.

Descriptive research spans both quantitative and qualitative methodologies, it brings the ability
to describe events in greater or less depth as needed, to focus on various elements of different
research techniques, and to engage quantitative statistics to organize information in meaningful
ways. It forms the basis of rigorous data analysis. It can be much easier to work with, interpret,
and discuss than raw data. Besides, descriptive statistics are a fairly straightforward process that
can easily translate results into a distribution of frequency, percentages and overall averages
through graphically and numerically. It will form the basis for more advanced statistical methods
such as inferential analysis.

Hence, under this method also, the researcher could us the results of the research based
on the various measurements to conduct a decision making and examining whether the research
objectives been achieved or not. Therefore, it could help the researchers to have a better
explanation on the research hypothesis as well.

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References

Berry, William D., and Stanley Feldman. 1985. Multiple Regression in Practice. Newbury
Park, CA: Sage.

Boone, H. N., & Boone, D. A. (2012). Analyzing Likert Data. Journal of Extension, 50(2).

Greene, William H. 2000. Econometric Analysis (Fourth edition). Upper Saddle River, NJ:
Prentice-Hall.

Jaccard, J., Guilamo, R., Johansson, M., & Bouris, A. (2006). Multiple Regression Analyses in
Clinical Child and Adolescent Psychology. Journal of Clinical Child & Adolescent
Psychology., 456-479.

Khan, K. U., Gulzar, S., & Yahya, F. (2013). Crucial Factors Affecting Stress: A Study Among
Undergraduates in Pakistan. International Journal of Asian Social Science, 3(2), 428-442.

R. Coe, R. S. (2002). Objectives and steps in data analysis. Retrieved from

https://www.ilri.org/biometrics/GoodStatisticalPractice/publications/notes_ex/le02.pdf

Rosenbaum, K. A. (2016). Radiography Students: Factors Contributing to their Stress and

Methods of Coping. Electronic Theses and Dissertations, Paper 3111. Retrieved from
http://dc.etsu.edu/etd/3111

Subhani, M. I., Osman, A., Saad, M., & Mir, S. (2013). Formulation of Advanced H-Index: The
S-Index. South Asian Journal of Management Sciences, 60-67.

Zeng, W., & Gu, M. (2017). Relationship Between Mindfulness And Positive Affect Of Chinese
Older Adults: Optimism As Mediator. Social Behavior & Personality: an international
journal., 155-162.

Zikmund, W. G. (2003). Business Research Methods (7th ed.). Thomson South Western, Ohio:
South-Western Publishing.

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