a. Given the following, determine the firm's optimal capital structure: Round your answers for capital structure to the nearest whole number and for the cost of capital to one decimal place. The optimal capital structure: cost of capital of % debt and % equity with a (3) % b. If the firm were using 50 percent debt and 50 percent equity, what would that tell you about the firm's use of financial leverage? Round your answer for the cost of capital to one decimal place. If the firm uses 50% debt financing, it would be using combination the cost of capital is substituting %. The firm could lower the cost of capital by financial leverage. At that substituting c. What two reasons explain why debt is cheaper than equity? Debt is cheaper than equity because interest expense addition, equity investors bear risk. d. If the firm were using 20 percent debt and 80 percent equity and earned a return of 9.7 percent on an investment, would this mean that stockholders would receive less than their required return of 11.0 percent? If the firm earns 9.7% on an investment, the stockholders will earn than their What return would stockholders receive? Round your answer to one decimal place. 23%