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aemarmolejos aemarmolejos
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A year ago
The Delta Co. owns retail stores that market home building supplies. Largo, Inc. builds single family homes in residential developments. Delta has a beta of 1.22 and Largo has a beta of 1.34. The risk-free rate of return is 4 percent and the market risk premium is 6.5 percent. What should Delta use as their cost of equity if they decide to purchase some land and create a new residential community?

▸ 11.93 percent

▸ 12.32 percent

▸ 12.43 percent

▸ 12.57 percent

▸ 12.71 percent
Textbook 
Corporate Finance Online

Corporate Finance Online


Edition: 2nd
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klynklyn
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A year ago
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12.71 percent
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aemarmolejos Author
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A year ago
You make an excellent tutor!
Chaldoren
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Yesterday
Brilliant ツ
rene_ram97
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2 hours ago
Smart ... Thanks!
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