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Hamada equation Original % debt in capital structure, Wd Original % common equity in capital structure, wc Risk-free rate, IRE Market risk premium, RPM Tax

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Hamada equation Original % debt in capital structure, Wd Original % common equity in capital structure, wc Risk-free rate, IRE Market risk premium, RPM Tax rate, T Firm's cost of equity, rs 20.00% 80.00% 6.00% 7.00% 40.00% 16.00% Formulas Calculation of firm's current beta: Firm's current beta, bL #N/A Calculation of firm's unlevered beta: Firm's unlevered beta, bu #N/A New % of debt in capital structure, Wd New New % of common equity in capital structure, Wc New 50.00% 50.00% Calculation of firm's new beta: Firm's new beta, bL New #N/A Calculation of firm's new cost of equity: Firm's new cost of equity, Is New #N/A

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