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Firm a intends to form a new division which will

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Firm A intends to form a new division which will effectively double its assets. The firm is currently financed entirely by equity and has a required rate of return of 18%. To reduce its required rate of return to 15%, given a risk-free rate of 9% and a market risk premium of 6%, the maximum beta that the new division may have is:

Reference no: EM13485371

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