0 ayash895@gmail.comPro Asked: July 21, 20212021-07-21T22:12:57+05:30 2021-07-21T22:12:57+05:30In: Corp. Finance (CFA L1) Cost of capital 0 How to solve it Share Sorry, you do not have permission to answer to this question. 1 Answer Oldest Jay Kotecha Moderator Moderator 2021-07-22T07:27:22+05:30Added an answer on July 22, 2021 at 7:27 am Hello, In the above question you just have to use the formula for Asset Beta or unlevered beta = Beta levered (1.4)/1+D/E(1.5)*(1-.35) you get the answer .71 option C *Debt equity ratio since debt = .6 equity = .4 D/E = .6/.4 = 1.5 Hope this helps!
Hello,
In the above question you just have to use the formula for Asset Beta or unlevered beta = Beta levered (1.4)/1+D/E(1.5)*(1-.35) you get the answer .71 option C
*Debt equity ratio since debt = .6 equity = .4 D/E = .6/.4 = 1.5
Hope this helps!