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Homework answers / question archive / Rudolph's Transportation has an overall cost of equity of 14
Rudolph's Transportation has an overall cost of equity of 14.8 % and a beta of 1.4. The firm is financed solely with common stock. The risk-free rate of return is 3.5 %. What is an appropriate cost of capital for a division within the firm that has an estimated beta of 1.3?