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Assume BPS Corp has 0% in their capital structure and has a tax rate of 25%. Their current Beta is 0.65. Management now decides to

Assume BPS Corp has 0% in their capital structure and has a tax rate of 25%. Their current Beta is 0.65. Management now decides to increase their debt load and will result in a debt/equity ratio of 0.40. Given this change, what is the new Beta of the firm given this added leverage?

0.65
0.845
0.729
1.03

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