9. Determining the optimal capital structure Understanding the optimal capital structure Review this situabions Universal Exports Inc. is trying to Identify its cotimal capital structure. Universal Exports inc has gathered the following financal information to help with the analysisi. Which capital structure shown in the preceding table is Universal Exports inc's optimal capital structure? Debt ratio =60%, equity ratio =4044 Debt natio =400%; equity ratio =60% Debc ratio 30% equity rato =70% Debt ratio = Po\%si equity ratio =30% Debe ratio - sow; equity rimis n so\% Consider this case: Globo Chem Co. has a capital structure that consists of 40% debt and 60% equity. The firm's current beta is 1.10, but management wants to understand Globo-Chem Cois market risk without the effect of leverage. If Globo-Chem Co. has a 45% tax rate, what is its unlevered beta? 0.96 0.84 0.92 0.80 Now consider the case of another company? U.5. Robotics inc. has a current capital structure of 30% debt and 70% equity. 1ts current before-tax cost of debt is 6%, and its tax rate is 45%. It currently has a levered beta of 1.10. The risk-free rate is 2.5%, and the risk premium on the market is 8%. U.5. Mobotics inc, is considering changing its capital structure to 60% debt and 40% equity. Increasing the firmis level of debt will cause its before-t cost of debt to increase to 8%. Use the Hamada equation to unlever and relever the beta for the new level of debt. What will the firm's weighted averege cost of capital (WACC) be if it maves this change in its capital structure? (Hint: Do not round intermediate calculations.) Which of the following statements regareing a firm's optimal capital structure are truef Check all that apply. The optimal capital structure minimizes the firms cost of debt. The optimsi capital structure minimires the firm's cost of ecuity. The optimal capital structure minimizes the firmis WACC. The optimal copital structure mavimires the firmis EPS. The optimal capital uructure maximizes the firm's stock price