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What is an appropriate cost of capital for division

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BexTex has a beta of 1.05 and a cost of equity of 13% for the firm overall. The firm is financed solely by common stock. Division A within the firm has an estimated beta of 1.65 and is the riskiest of all of the firm's divisions. What is an appropriate cost of capital for division A if the market risk premium is 5%?

Reference no: EM133253362

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