In the Hamada Equation: Beta[leveraged] = Beta[unleveraged]*[1+(1-t)(D/E)] what tax rate (t) are you supposed to use? Is this the overall effective tax rate for the company (income tax expenses/pretax income)?
2007-01-25 02:43:28 · 4 answers · asked by jbortfeld 2 in Business & Finance ➔ Other - Business & Finance
yes, the effective tax rate.
2007-01-26 09:05:24 · answer #1 · answered by Shanan 4 · 0⤊ 0⤋
Hamada Equation
2016-10-16 06:54:27 · answer #2 · answered by ? 4 · 0⤊ 0⤋
It mite be the overall tax rate count, It is better to go for advice
2007-01-26 21:16:56 · answer #3 · answered by Judy C 1 · 0⤊ 0⤋
total taxes paid divided by total income after interest
btw, the hamada equation works only under some stiff assumptions
here is a paper on this topic
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2414221
2014-04-08 02:35:37 · answer #4 · answered by Ja Ma 5 · 0⤊ 0⤋