2. Killeen Products Inc. currently uses no debt, but its new CFO is considering changing the capital structure to 40.0% debt by issuing bonds and using the proceeds to repurchase and retire some common stock at book value. Given the data shown below, what would be the levered beta? 4.25% 7.25% 1.87 Tax rate, T Current debt ratio Target debt ratio 32% 0% 40% Risk-free rate, R Market risk premium, RPM Current beta, Bu A) 3.61 B) 2.99 C) 2.88 D) 2.72 E) 2.45