Qualcomm currently has a capital structure of 80 percent debt and 20 percent equity, but is considering a new product that will be produced and marketed by a separate division. The new division will have a capital structure of 60 percent debt and 40 percent equity. Qualcomm has a current beta of 3.2, but is not sure what the beta for the new division will be. Nvidia is a firm that produces a product similar to the product under consideration by Qualcomm. Nvidia has a beta of 1.8, a capital structure of 40 percent debt and 60 percent equity and a marginal tax rate of 40 percent. Qualcomm's tax rate is 30 percent. Estimate the levered beta for Qualcomm's new product division.

--2.28

--2.64

--3.05

--4.89