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Counts Accounting has a beta of 1.40. The tax rate is 35%, and Counts is financed with 35% debt. What is Counts' unlevered beta? Round
Counts Accounting has a beta of 1.40. The tax rate is 35%, and Counts is financed with 35% debt. What is Counts' unlevered beta? Round your answer to two decimal places.
Levered Beta = Unlevered Beta x (1 + ((1 Tax Rate) x (Debt/Equity)))
1.40 = Unlevered Beta (1+(1-0.35)(0.35))
I am not sure how to solve equation from here. Thanks!
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