The finance manager of nn co. estimated the following

Reference no: EM13962754

The finance manager of NN Co. estimated the following
Unlevered beta (B_UL)	0.86
Debt to equity ratio (D/E)	40.00%
Tax rate (t)	30%
Risk free rate	3%
Market risk premium	5%
By how much would the capital structure shift change the Co's cost of equity?

a- Less than 1%

b- Between 1% and 1.10%

c- between 1.15% and 1.25%

d- between 2% and 3%

Reference no: EM13962754

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