Ang Enterprises has a levered beta of 1.10, its capital structure consists of 40% debt and 60% equity, and its tax rate is 40%. What would Ang's beta be if it used no debt, i.e., what is its unlevered beta?
A) 0.64
B) 0.67
C) 0.71
D) 0.75
E) 0.79

Question

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The Answer of Ang Enterprises has a levered beta of 1.10, its capital structure consists of 40% debt and 60% equity, and its tax rate is 40%. What would Ang's beta be if it used no debt, i.e., what is its unlevered beta?
A) 0.64
B) 0.67
C) 0.71
D) 0.75
E) 0.79

Ang Enterprises Has a Levered Beta of 1