The average unlevered beta of publicly traded sodium


The average unlevered beta of publicly traded Sodium Chlorate businesses is 0.94. Assume zero debt beta. The target capital structure that is appropriate for Collinsville plant is 35% debt and 65% equity. Assume a risk-free rate of 9.5% and market risk premium of 7.5%. The firm could issue debt for this investment at a cost of 11.25%. Corporate tax rate is 48%.

The NPV of the Collinsville Plant is (in $ thousands):

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Financial Management: The average unlevered beta of publicly traded sodium
Reference No:- TGS01084585

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