you have been asked to value the assets of a privately held consulting company. You...
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Finance
you have been asked to value the assets of a privately held consulting company. You used the capital asset pricing model to estimate the equity betas for every firm in this industry and then computed the average equity beta. You noticed that firms in the industry have significantly different capital structures. You told your boss that this average equity beta is the appropriate beta to use for the valuation of the consulting companies assets. Should your boss agree with you? Why or why not? if not, what alternative approach would you recommend? Explain.
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