SmartCar ASA has an investment beta of 1.3, and the risk-free rate is 4%. The...
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SmartCar ASA has an investment beta of 1.3, and the risk-free rate is 4%. The expected return on the market portfolio is 11%, and the corporate tax-rate is 27%. There are no personal taxes. The cost of debt is 5%, and the debt-to-value is 40% based on market values.
What is SmartCars cost of equity if the company is financed by equity only?
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