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The risk free rate currently have a return of 2.5% and the market risk premium is 7.83%. If a firm has a beta of 1.42, what is its cost of equity

The risk free rate currently have a return of 2.5% and the market risk premium is 7.83%. If a firm has a beta of 1.42, what is its cost of equity
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The risk free rate currently have a return of 2.5% and the market risk premium is 7.83%. If a firm has a beta of 1.42, what is its cost of equity

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User Agus Puryanto
by
8.9k points

1 Answer

4 votes

Answer:

13.62 %

Step-by-step explanation:

Cost of Equity = 2.5% + 7.83% x 1.42 = 13.62 %

answered
User Pankaj Verma
by
7.7k points
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