Final answer:
An all-equity-financed firm's equity beta is equal to its asset beta because there is no financial leverage from debt to affect the company's beta.
Step-by-step explanation:
An all-equity-financed firm's equity beta is equal to its asset beta. Since there is no debt in the company's capital structure, there is no financial leverage to affect the company's beta. In finance, beta is a measure of the volatility, or systematic risk, of a security or a portfolio compared to the market as a whole. Equity beta measures the risk of the firm's equity, while asset beta measures the risk of the firm's assets, unencumbered by debt. An all-equity-financed firm does not have the risk that comes with borrowing, so the firm's equity risk reflects the risk of its assets directly. Therefore, the correct answer is (c) Equal to.