Calculation of beta and weighted average cost of capital

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Reference no: EM1315090

A company has a capital structure of 40% equity and 60% debt. Equity beta is 1.2, the Weighted Average Asset Betas of five other companies are 0.9. The company needs determine the hurdle rate.

How asset betas should be used? What is the corresponding Cost of Capital?

Reference no: EM1315090

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