Colt manufacturing has two divisions: 1) pistols; and 2) rifles. betas for the two divisions have been determined to be beta (pistol) = 0.4 and beta (rifle) = 0.9. the current risk - free rate of return is 4.5%, and the expected market rate of return is 9.5%. the after-tax cost of debt for colt is 3%. the pistol division's financial proportions are 45.0% debt and 55.0% equity, and the rifle division's are 55.0% debt and 45.0% equity