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PB Question 7 B 4 YG 12 Marks] Titanium Minerals has an estimated beta of...

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PB Question 7 B 4 YG 12 Marks] Titanium Minerals has an estimated beta of 1.6. The company is evaluating the acquisition of another company that has a beta of 1.2 Both companies are exactly the same size. Required: 7.1. What is the expected new beta value for the combined company? [2] 72. The risk-free rate of return is estimated at 7 percent and the market retum is estimated as 12 percent. What is your estimate of the required rate of return of investment in Titanium before and after the merger? [4] [TURN OVER]

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