Quickly please .... I'll give you straight like

Netflix is a media and entertainment company that is in three businesses - cable with an estimated value of $ 9 billion, television networks with an estimated value of $ 7 billion and satellite television with an estimated value of $ 6 billion.

You have estimated a regression beta of 1.045 for the firm, using data over the last 5 years, during which period Netflix had a debt to capital ratio of 20%.

The three businesses have very different risk characteristics and you have been able to find bottom-up betas for two of three businesses unlevered betas of 0.5 for cable and 1.4 for television networks but have been unable to get a beta for the satellite television business. (You can assume a 40% corporate tax rate)

Now assume that the firm currently has a debt to capital ratio of 40% and you can assume that the market has priced the firm correctly and it plans to sell its satellite television business and use the proceeds to pay down debt.

.

.

1- Estimate the unlevered beta for Netflix after selling the satellite television business.

2- Estimate the levered beta after the selling transaction.