A company has a beta of 1.5 and debt/equity ratio of 50%. Its current market value of

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A company has a beta of 1.5 and debt/equity ratio of 50%. Its current market value of equity is 500 crores. If the company takes another 150 crores of debt, what will its new beta be? Assume tax rate is 30%.

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Contemporary Engineering Economics

ISBN: 978-0136118480

5th edition

Authors: Chan S. Park

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Posted Date: Apr 02, 2024 04:22 AM

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A company has a beta of 1.5 and debt/equity ratio of 50%. Its current market value of

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To calculate the new beta of the company we need to consider the impact of the additional debt on th... View the full answer

Contemporary Engineering Economics

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