Use the Following Information to Answer the Question(s)below

question 67

Multiple Choice

Use the following information to answer the question(s) below.
Consider the following information regarding corporate bonds:
-Trucks R' Us has a market capitalization of $142 billion,$78 billion in BB rated debt,and $10 billion in cash.If Trucks R' Us' equity beta is 1.68,then their underlying asset beta is closest to:

• A)1.00
• B)1.20
• C)1.32
• D)1.48

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Definitions:

Information Technology

The use of computers, storage, networking, and other physical devices, infrastructure, and processes to create, process, store, secure, and exchange all forms of electronic data.

Step-down Method

A cost allocation method used to allocate overhead costs to departments or products, moving sequentially from departments with the highest overhead costs to those with the least.

Service Department

A service department is a unit within an organization that provides support services to other departments, rather than directly contributing to revenue.

Operating Department

A department in which the central purposes of the organization are carried out.