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The finance manager of NN Co. estimated the following
Unlevered beta (BUL) 0.86
Debt to equity ratio (D/E) 40.00%
Tax rate (t) 30%
Risk free rate 3%
Market risk premium 5%
By how much would the capital structure shift change the Co's cost of equity?
a- Less than 1%
b- Between 1% and 1.10%
c- between 1.15% and 1.25%
d- between 2% and 3%

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