As we know geared beta = ungeared beta x [1 + debt equity ratio x (1-tax)] So, i would like to know while applying this formula do we have to take debt equity ratio as debt/equity or debt/(debt+equity) as these both are correct formulae but will give different results.
It's debt/equity here. (Debt or equity)/debt+equity is used to give weights to the cost of debt and equity respectively in the formula for WACC
