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The capital market is perfect. Qualcomm Inc. has $20 billion in debt, total equity capitalization of $10 billion, and an equity beta of 1. Included

The capital market is perfect. Qualcomm Inc. has $20 billion in debt, total equity capitalization of $10 billion, and an equity beta of 1. Included in Qualcomms assets was $10 billion in cash and risk-free securities. Qualcomm Inc.s debt has an AAA rating with a beta of 0. Suppose the firm now uses the $5 billion cash to repurchase its stocks. a. What is the firms unlevered beta before the stock repurchase? b. Should the firms unlevered beta keep the same after the stock repurchase? Just answer yes or no. c. What is the value of the firms equity after the stock repurchase? d. What is the beta of the firms equity after the stock repurchase? e. Should the firms stock price keep the same after the stock repurchase? Just answer yes or no.

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