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An all-equity firm has a beta of .85. Assume the beta of debt is equal to the risk free beta. If the flrm changes to

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An all-equity firm has a beta of .85. Assume the beta of debt is equal to the risk free beta. If the flrm changes to a debt-equity ratio of 40 percent debt its equity beta would be and if it changes its debt-equity ratio to 50 percent is equity beta would be O 567,850 1190: 1.275 O 1417, 1700 O 1417:1.275 1190,1700

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