Question 45 3 pts Dyson Inc. currently finances with 20.0% debt (i.e., wd = 20%),...
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Question 45 3 pts Dyson Inc. currently finances with 20.0% debt (i.e., wd = 20%), but its new CFO is considering changing the capital structure so wd = 69.5% by issuing additional bonds and using the proceeds to repurchase and retire common shares so the percentage of common equity in the capital structure (w.) = 1 Wd. Given the data shown below, by how much would this recapitalization change the firm's cost of equity? Do not round your intermediate calculations. (Hint: You must unlever the current beta and then use the unlevered beta to solve the problem.) = 25% Risk-free rate, IRF Market risk prem, RPM Current beta, bli 5.00% Tax rate, T 6.00% Current wa 20% 1.50 Target wd 69.5% 12.20% 10.37% 15.01% ooo 10.61% 13.67%
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