Ethie enterprise has an unlevered beta of 13 ethie is


Premium for Financial Risk

Ethie Enterprise has an unlevered beta of 1.3. Ethie is financed with 45% debt and has a levered beta of 1.8. If the risk free rate is 6% and the market risk premium is 7%, how much is the additional premium that Ethie's shareholders require to be compensated for financial risk? Round your answer to two decimal places.

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Financial Management: Ethie enterprise has an unlevered beta of 13 ethie is
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