The Financial Equilibrium Based on a Marginal Approach to Improve the Financial Performance of the State Electricity Company (PLN)

Assagaf, Aminullah and Sayidah, Nur and Ady, Sri Utami (2020) The Financial Equilibrium Based on a Marginal Approach to Improve the Financial Performance of the State Electricity Company (PLN). International Journal of Innovation, Creativity and Change, 13 (7). pp. 1210-1228. ISSN 2201-1323

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Abstract

This study aims to analyse the factors that influence the State Electricity Company (PLN) financial equilibrium. The position of the equilibrium of marginal revenue, with marginal cost, shows the best conditions achieved by the company. Thus, in the event the position is further from the equilibrium, the company's financial performance tends to decline. The study uses secondary data based on the PLN's financial statements from 2007 to 2018. During that period, the PLN made a large-scale investment. The PLN built a power plant installation with a large capacity. This study aims to analyse the specific period, as well as a source of information that can provide input for the main stakeholders of the PLN. The results of the statistical tests show that the key variables have a significant effect on the PLN's financial equilibrium. This study also found a unique condition because it contradicts the prediction before the research, namely the variables X6AG, X7IG, and X8ROE, were found to have a negative effect or the opposite of the original prediction, which is a positive effect on the company's financial equilibrium. This result is the originality of this research, so it is very useful for corporate management, and research in the future.

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