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You are analyzing the beta of HP and have divided the company into four business groups Currently HP has 4 billion of debt outstanding (assume
You are analyzing the beta of HP and have divided the company into four business groups Currently HP has 4 billion of debt outstanding (assume equally distributed among divisions $1B each) and subject to %36 corporate tax; betas and market values for each group are: Business Group Unlevered Beta Market Value Mainframes 2.25 0.74 Persenal 2.25 1,4 computers Software 3.125 2 Printers 3.375 1.3 10) What is the unlevered beta of HP: 0.83 a. b. 1.29 d. 1.37 1.42 e. 11) What is the levered beta of HP: 1.1 a. b. 2.05 1.97 C. d. 2.51 2.11 e. sh (US)
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