b) Leeson Bhd. expects a constant growth rate of 5% in the future. Treasury bills yield 8% and the market is returning 13% on an average issue. Leeson's last annual dividend was $1.35. The company's beta has historically been .9. The introduction of a new line of business would increase the expected growth rate to 7% while increasing its risk substantially. Management estimates the firm's beta would increase to 1.2 if the new line is undertaken. Should Lipson undertake the new line of business? (13 marks) b) Leeson Bhd. expects a constant growth rate of 5% in the future. Treasury bills yield 8% and the market is returning 13% on an average issue. Leeson's last annual dividend was $1.35. The company's beta has historically been .9. The introduction of a new line of business would increase the expected growth rate to 7% while increasing its risk substantially. Management estimates the firm's beta would increase to 1.2 if the new line is undertaken. Should Lipson undertake the new line of business? (13 marks)