Question
A firm currently has an asset beta of 0.5, an equity beta of 1.3, and a leverage of 54%. They plan to change their capital
A firm currently has an asset beta of 0.5, an equity beta of 1.3, and a leverage of 54%. They plan to change their capital structure to a new leverage of 36%. What will the asset beta be if the company does change its leverage?
Enter your answer rounded to 1 decimal.
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Financial Risk Manager Handbook
Authors: Philippe Jorion
6th Edition
0470904011, 978-0470904015
