ACCT 5011-You have calculated the Beta of Assets of the
Subject: Business / Finance
Question
You have calculated the Beta of Assets of the comparable companies to be 1.28. You want to calculate the Beta of Equity for your company going forward. Your company currently has an equity to value ratio of 38%. Your company has a target equity to value ratio of 63%. Your beta of debt is 0. If the tax rate is 27%, what Beta of Equity should you use for your company in calculating your cost of capital to evaluate future projects? (please show at least two decimal places).
