=10. (This problem tests your understanding of the chapter appendix.) Sweat Equity Appliance, Inc., a private firm

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=10. (This problem tests your understanding of the chapter appendix.)

Sweat Equity Appliance, Inc., a private firm that manufactures home appliances, has hired you to estimate the company's beta. You have obtained the following equity betas for publicly traded firms that also manufacture home appliances.

The publicly traded firms all have a marginal tax rate of 40 percent.

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