How much is the additional premium that ethiers


Premium for Financial Risk

Ethier Enterprise has an unlevered beta of 1.15. Ethier is financed with 45% debt and has a levered beta of 1.55. If the risk free rate is 4% and the market risk premium is 4%, how much is the additional premium that Ethier's shareholders require to be compensated for financial risk? Round your answer to two decimal places.

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Financial Management: How much is the additional premium that ethiers
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