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Java Company currently has a capital structure consisting of 55% debt and the remaining as...

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Accounting

Java Company currently has a capital structure consisting of 55% debt and the remaining as equity, a levered beta of 1.51, and its tax rate is 40%. The company is considering to adopt a new capital structure of 21% debt and the remaining as equity. What would the companys new levered beta be under the new capital structure? Round your answer to two decimal places. (Hint: Use the Hamada equation.)

Group of answer choices

1.05

1.03

1.01

1.07

1.10

Answer & Explanation Solved by verified expert
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