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Asalanka Homes has a beta of 1.1. The market risk premium is 6% and the risk-free rate of return is 2.5%. By how much will

Asalanka Homes has a beta of 1.1. The market risk premium is 6% and the risk-free rate of return is 2.5%. By how much will the cost of equity increase if the company completes an acquisition such that their company beta rises to 1.24?

Multiple Choice

0.14%

1.02%

0.84%

1.25%

0.56%

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