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A firm has 0% debt and a beta of 1.3. This firm is considering issuing equity. The expected capital structure is 60% equity and 40%
A firm has 0% debt and a beta of 1.3. This firm is considering issuing equity. The expected capital structure is 60% equity and 40% debt with a tax rate of 65%. If the risk free rate is 6%, the market risk premium is 7%, calculate the change in the firm's cost of equity.
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