Firm optimal capital structure

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Reference no: EM132057349

A firm’s optimal capital structure ______ is generally

a mix of 40% debt and 60% equity.

exists when the debt-equity ratio is 0.5.

is the debt-equity ratio that exists at the point where the firm’s weighted after-tax cost of debt is minimized.

is the debt-equity ratio that results in the lowest possible weighted average cost of capital and the largest firm value.

If a stock has beta 1.5, how to interpret it?

The stock is riskier than average.

The stock has average risk.

The stock is less risky than average.

Reference no: EM132057349

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