Find the beta of the equity in the firm be after the lbo


safecorp, which owns and operates grocery stores across the United States, currently has $50 million in debt and $100 million in equity outstanding. Its stock has a beta of 1.2. It is planning a leveraged buyout, where it will increase its debt/equity ratio to 8. If the tax rate is 40%, what will the beta of the equity in the firm be after the LBO?

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Finance Basics: Find the beta of the equity in the firm be after the lbo
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