Question no 1: Define problem statement and identify the problem statement in the below passages taken from a research article. 2

Question 2: Define and list down the dependent, independent variable, moderating variable and mediating variable from the below passages taken from research article? 3

Question no 3: List down the possible directional OR non-directional hypothesis from the above passages taken from a research article 4

Question no 4: Graphically represent the relationship between the variables. It is also important to show graphically that which variable is moderating, mediating, dependent and independent in the above passages taken from the research article. Please Answer this question by drawing the framework and dont write anything descriptive for this question.

Introduction: Innovation can play a signicant role in enhancing economic growth and has the potential to bring about change and create opportunities for every business. Technological adoption is mainly found in Eastern European SMEs rather than in Central Asian countries where the average number of employees hired in Central Asian firms is lower (Damaskopoulos & Evgeniou 2003; Purcarea et al. 2013). The literature recognizes innovation as a key factor contributing to rm performance. A number of studies analyse the direct eects of innovation on corporate performance (Mustafa & Yaakub 2018; Prange & Pinho 2017; Rosli & Sidek 2013; Ullah 2020; Wang 2016): however, little is known of the mechanisms that underlie rm-level innovation. There is mixed evidence about whether firm size affects firm performance (Andries & Faems 2013;Benfratello et al.2008; Dooley et al. 2016).

To invest in technology and innovation, external nance from banks and nancial institutions are the main sources of funding (Benfratello et al. 2008). However, due to a lack of collateral in a majority of SMEs (Duarte et al. 2017), their credit trustworthiness is lower than that of large-sized rms. As a result, many SMEs experience diculties in accessing nancial capital (Calcagnini et al. 2011). A number of scholars have investigated this direct relationship between SMEs nance and rm performance, and the results have indicated either positive or negative relationships. However, there are still insucient studies that examine whether dierent types of nancing in rms with innovation are associated with an improvement in rm performance. Although many studies examine the eect of technology usage and nancial resources on SMEs performance (Budiarto & Pramudiati 2018), there is an absence of research that focuses on how these two factors impact on rm performance at the same time. Therefore, the second aim of this study is to examine the mediating eect of nancing, specically how nancial capital mediates the relationship between innovation and rm performance. This contributes to prior research regarding the mediating eect of dierent type of nance on the performance of SMEs (Fernandez 2017). This study extends previous research about capital structure in large-sized rms and SMEs, which mostly discuss funding in relation to liability and equity (RevestandSapio2012). It also contributes to the literature by showing that rm size is a relevant factor in the nancing behavior of SMEs and their innovation level.

Literature Review:

Technology usage promotes sustainability, growth (Fowowe 2017) and can facilitate business success (Budiarto and Pramudiati 2018). Various types of innovative developments are associated with dierent aspects of performance (Saunila 2014). Previous studies mention a positive relationship between the innovation and performance of SMEs (Centobelli et al. 2019; Chege and Wang 2020; Mashal 2018). The impacts of innovation on the performance of a firm can be demonstrated by both financial and non-financial indicators (Mashal 2018). The positive impacts of innovation include the ability to compete with others(Anwar 2018; Conto et al.2016), financial accessibility (Abdu and Jibir 2018), connection and communication (Radzi et al. 2017), marketing (Adam et al. 2017), and export performance (Azar and Ciabuschi 2017; Love et al. 2016; Prange and Pinho 2017). However, some critics have a dierent perspective. For example, Karabulut (2015) found that innovation has negative impacts on rm growth. It has also been suggested that a failure to consider the potential negative eects of innovation could eventually impact on the environment and lead to uncontrollable business growth (Laforet 2011). In spite of reservations like these about potential negative impacts, there is strong support in the literature for the positive direct eects of innovation on rm performance.

Innovation activities are driven by the availability of nance. Abdu and Jibir (2018) conrmed that SMEs innovation activities are limited by internal nance. The decrease in the internal nance of a large-sized rm does not lead to a decline in innovative performance, as they can obtain replacement capital from external formal nancial institutions. Without financial support and adequate financial resources or capital, innovative ideas can no longer yield substantive effects on the firm performance .This is generally due to the requirement of huge financial capital to translate the innovative ideas into reality. So, financial capital is no longer having a direct effect on the firm performance. In contrast, SMEs having problems in generating internal nance have a higher probability of a decline in cash ow. Then, they tend to face diculties in obtaining formal nance from banks and formal nancial institutions. Financial constraints are particularly severe in rms with innovative activities (Boic and Rajh 2016). Some studies indicate a positive relationship between product and process innovation and support in terms of formal nance, which then impacts rm performance (Ayyagarietal.2010). Leeetal. (2015) demonstrated that innovative rms are more likely than other rms to be turned down for nance, particularly in SMEs in which performance is related to innovative products or services. This is because of the high cost of innovation which is less likely to be spent by SMEs (Santiago et al. 2017). To enhance rm performance, it is suggested that innovative SMEs should try to obtain nancial support from either formal or informal institutions, or both (Benfratello et al. 2008). Therefore, it is worthwhile to establish that how financial capital completes the indirect relationship between innovation and firm performance.

Innovative activities within the same physical capital structure in SMEs and in large-sized rms are dierent (Noori et al. 2017). Innovative projects normally involve large xed costs. Large rms have a greater ability to access external nance to progress research and development

(R&D) projects compared with SMEs (Noori et al. 2017; Schumpeter 1942). This capacity can have a positive impact on rm performance (Sachs and McArthur 2002). Large-sized rms and SMEs typically undertake dierent types of innovative activities. External innovative activities draw on internal resources and external knowledge as well as technological skills. These activities mainly involve improvements to the productivity of a rm. Internal innovation relates to a companys resources and capabilities that are associated with innovative R&D activities (Kim et al. 2016). The study states that while both external and internal innovative R&D activities impact the performance of large-sized rms, only internal innovative R&D activities aect the performance of SMEs (Kim et al. 2016). Similarly, Mabenge et al. (2020) state that the impact of innovation seems to be stronger in bigger and younger rms. From the literature it is made clear that size of the firm is important determinant of firm performance because it not only having a direct impact on the firm performance but it is also having the capacity to create strong contingent effect on the relationship between the innovation and firm performance.