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El Capitan Foods has a capital structure of 3 6 % debt and 6 4 % equity, its tax rate is 3 0 % ,

El Capitan Foods has a capital structure of 36% debt and 64% equity, its tax rate is 30%, and its beta (leveraged) is 1.40. Based on the Hamada equation,
What would the firms beta be if it used no debt i.e. what is its unlevered beta, b_U?
Now, if the capital structure changed to 60% debt and 40% equity, find the b_L.

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