Question: You are evaluating a new project and need an estimate for your project's beta. You have identified the following information about three firms with comparable
You are evaluating a new project and need an estimate for your project's beta. You have identified the following information about three firms with comparable projects: Firm Name Equity Beta Debt Beta Debt to Equity Ratio Lincoln 1.25 0 0.25 Blinkin 1.6 0.2 1 Nod 2.3 0.3 1.5 Based upon the three comparable firms, what asset beta would you recommend using for your firm's new project? Answer text ....... 2.Which of the following equations would NOT be appropriate to use in a firm with risky debt? Question 2Select one: A. U = E + (U - D) B. E = U + (U - D) C. E = U + U D. U = E + D 3.You are evaluating a new project and need an estimate for your project's beta. You have identified the following information about three firms with comparable projects: Firm Name Equity Beta Debt Beta Debt to Equity Ratio Lincoln 1.25 0 0.25 Blinkin 1.6 0.2 1 Nod 2.3 0.3 1.5 The unlevered beta for Nod is closest to: Question 11Select one: A. 1.00. B. 1.10. C. 0.90. D. 0.95. 4.Louie's Truck Repair has assets with a market value of $8000. The company has three types of securities: equity, $2500 of debt, and 100 warrants that are fairly priced at $20 each. What is the value of Louie's equity? Question 12Select one: A. $3500 B. $5430 C. $12,500 D. $10,500
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