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Why do we need to de-lever and lever an equity beta

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Reference no: EM132753292

Question: (a) Why is a target leverage ratio a key assumption of the standard WACC model?

(b) Why do we need to de-lever and lever an equity beta?

(c) Why are credit ratings important in estimating the cost of debt?

(d) What is the key design feature of a floating priced option and why?

(e) What is a grossed-up equity return and why is it important?

Reference no: EM132753292

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