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单项选择题

位置10的问题 Tidewater Fishing has a current beta of 1.16. The market risk premium is 6.8 percent and the risk-free rate of return is 2.9 percent. By how much will the cost of equity increase if the company expands its operations such that the company beta rises to 1.18? .43%.26%.12%.28%.14%清除选择

选项
A..43%
B..26%
C..12%
D..28%
E..14%
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思路分析
We start by outlining the CAPM relationship for cost of equity: Cost of equity = Risk-free rate + Beta × Market risk premium. First, compute the current scenario to understand the baseline: - Current beta = 1.16 - Market risk premium = 6.8% - Risk-free rate = 2.9% Current cost of equity = 2.9% + (1.16 × 6.8%) = 2.9%......Login to view full explanation

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