An All-Equity Firm Has a Beta of 0

question 13

Multiple Choice

An all-equity firm has a beta of 0.94.Assume the beta of debt is equal to the risk-free beta.If the firm changes to a debt-equity ratio of 0.35,its equity beta would be ________,and if it changes its debt-equity ratio to 0.40,its equity beta would be ________.

• A)1)269;1.316
• B)1)269;1.234
• C)1)190;1.234
• D)1)190;1.316
• E)1)234;1.316

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Definitions:

Designated Name

A specific identifier assigned to elements in a program or system for easier reference and access, often used in contexts like named loops or specific variables in structures.

Fclose()

A function in C programming utilized to close an open file pointer, effectively ending any further read or write operations to the file.

Function

A reusable block of code designed to perform a specific task, which takes inputs, processes them, and returns a result.

File Stream

Objects in various programming languages that facilitate reading from and writing to files.