If cbs beta is 20 greater than the overall market what is, Financial Management

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If cbs beta is 20 greater than the overall market what is

California Best (CB), a sport shoe store, expects an operating income of 2.3 million dollars this year. CB has no long-term debt. The firm is cosnidering an expansion proect. The current risk-free rate of return is 7% and the current market risk premium is 8.3%. If CB's beta is 20% greater than the overall market, what is the firm's cost of capital? Assume that CB has a marginal tax rate of 40%.

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Financial Management: If cbs beta is 20 greater than the overall market what is

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