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Initialy firm x has a beta of 1.3, when Rrf=7% and Rm=12 percent. The firm now sells 10 percent of its assets (Beta=1.2) and uses

Initialy firm x has a beta of 1.3, when Rrf=7% and Rm=12 percent. The firm now sells 10 percent of its assets (Beta=1.2) and uses the proceeds to purchase another asset, a machine with a beta of .8

What is the required rate of return on the machine?

What is the new overall required rate of return for firm x?

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