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Calculate the cost of equity for an equivalent all-equity

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Problem 1: The Beta Corporation has an optimal debt ratio of 39 percent. Its cost of equity capital is 11.1 percent and its before-tax borrowing rate is 4.4 percent. Given a marginal tax rate of 34 percent, calculate the cost of equity for an equivalent all-equity financed firm. (X.XX%)

Reference no: EM132949873

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