Question
Company: ABC corp market value of debt to market value of equity ratio: 3 book value of debt to book value of equity ration: 1
Company: ABC corp
market value of debt to market value of equity ratio: 3
book value of debt to book value of equity ration: 1
equity beta: 1.6
debt beta: .4
risk free rate 1%
expected market risk premium: 6%
ABC corp maintains a constant debt-to-equity ratio. The asset beta for ABC is______. Round to one decimal place.
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Fundamentals of Investments Valuation and Management
Authors: Bradford Jordan, Thomas Miller
7th edition
978-0078096785, 78096782, 978-0077861636, 77861639, 978-0078115660
