Consider a firm that historically has been continuously rebalancing its debt-to-value ratio to 30%. Today, the firm decides to increase its debt-to-value ratio to 50%, and plans to continuously rebalance to this new ratio in the future. Suppose this increase changes neither the company's debt beta nor its asset beta. As a result of this increase in leverage, ...

a.The equity beta increases

b.The equity beta falls

c.The equity beta stays unchanged

d.The equity beta could go up or down

e.None of the above