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A company's cost of debt and equity at various levels of debt is presented below. Based on this data, what is the optimal capital structure
| A company's cost of debt and equity at various levels of debt is presented below. Based on this data, what is the optimal capital structure - debt% and capital% - for this company? | |||||||||||||||
| Cost of | Cost of | ||||||||||||||
| Percent debt | Debt | Equity | |||||||||||||
| 0.00% | 0.00% | 11.00% | |||||||||||||
| 20.00% | 3.75% | 12.50% | |||||||||||||
| 40.00% | 5.00% | 13.50% | |||||||||||||
| 60.00% | 5.75% | 17.50% | |||||||||||||
| 80.00% | 6.75% | 21.00% | |||||||||||||
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International Financial Reporting And Analysis
Authors: David Alexander, Ann Jorissen, Martin Hoogendoorn
8th Edition
978-1473766853, 1473766850
