Q2. How does different debt levels change CPK S Beta?

		Debt/Total Capital
	Actual	10%	20%	30%
Interest rate	6.16%	6.16%	6.16%	6.16%
Tax rate	32.5%	32.5%	32.5%	32.5%
Earnings before income taxes and interest	30,054	30,054	30,054	30,054
Interest expense	0	1,391	2,783	4,174
Earnings before taxes	30,054	28,663	27,271	25,880
Income taxes	9,755	9,315	8,863	8,411
Net income	20,299	19,347	18,408	17,469
Book value:
Debt	0	22,589	45,178	67,766
Equity	225,888	203,299	180,710	158,122
Total capital	225,888	225,888	225,888	225,888
Return on equity	9.0%	9.5%	10.2%	11.0%
Market value:
Debt	0	22,589	45,178	67,766
Equity	643,773	628,526	613,278	598,031
Market value of capital	643,773	651,114	658,456	665,797
Market value of Debt/MV of Capital	0%	3%