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12. NIO firm has 0% of debt, and a beta of 1.5. NIO firm is considering issuing equity. The expected capital structure is 40% of
12. NIO firm has 0% of debt, and a beta of 1.5. NIO firm is considering issuing equity. The expected capital structure is 40% of debt, and 60% of equity. Tax rate of NIO firm is 65%. Assuming the risk free rate is 6%, market risk premium is 7%, calculate the the change in the firm's cost of equity. (Hint: Chapter 15, calculate the cost of equity when the firm is unleveraged, and then the cost of equity when the firm is leveraged).
13. Which of the following is true about China and U.S.?
O A or, Barc QUESTION 12 NIO firm has 0% of debt, and a bete of 1.5. NIO fimm is considering issuing equity. The expected capital structures 40% of debt, and 80% of gay. The otherm 85%. Assuming the risk free rate is 6%, market risk premium is 7%, calculate the the change in the firm's cost of equity. Pint: Cheche clothont of the the firm is unloveraged, and then the cost of equity when the firm is leveraged). 02.123% O 2.226% O 2.308% O 2.45096 2.59796 pole QUESTION 13 Which of the following is true about China and U.S.? O a. If China's inflation rate is lower than U.S.'s inflation rate, China's currency will appreciate. O b. If China's inflation rate is lower than U.S.'s inflation rate, China's currency will depreciate. O c. If China's interest rate is lower than U.S's interest rate, China's currency will appreciate. O a and c. QUESTION 14 Save All Click Save and Submit to save and submit. Click Save All Answers to save all answers
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