Consider the following information regarding corporate bonds: What is the estimate of the asset beta for ABC
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Question:
Consider the following information regarding corporate bonds:
What is the estimate of the asset beta for ABC Corp:
A. 0.81
B. 1.23
C. 1.30
D. 1.40
| Company | Market Value of Equity ($m) | Market Value of Debt ($m) | Equity Beta | Debt Beta |
| ABC Corp. | $5,000 | $2,500 | 1.8 | 0.3 |
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