Question
A firm is valued at $6 million and has debt of $2 million outstanding. The firm has an equitybeta of 1.8 and a debt beta
A firm is valued at $6 million and has debt of $2 million outstanding. The firm has an equitybeta of 1.8 and a debt beta of .42. The beta of the overall firm is:
A. 1.00.
B. 1.11.
C. 1.20.
D. 1.34.
E. It is impossible to determine with the information given.
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Corporate Finance A Focused Approach
Authors: Michael C. Ehrhardt, Eugene F. Brigham
4th Edition
1439078084, 978-1439078082
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