Question
Given the information below on peer companies A-E, calculate the beta for company F if it has net D/E of 0.72 and a tax rate
Given the information below on peer companies A-E, calculate the beta for company F if it has net D/E of 0.72 and a tax rate of 25%. All of the companies in the table below also have a tax rate of 25%.
| Company | Beta | Net D/E |
| A | 1.23 | 1.45 |
| B | 1.18 | 1.24 |
| C | 1.05 | 0.85 |
| D | 0.95 | 0.59 |
| E | 0.91 | 0.45 |
a. 0.95
b. 0.98
c. 1.06
d. 1.02
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Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo
5th Global Edition
1292304154, 978-1292304151
