Question
Based on the information below, what is the firms optimal capital structure? a) Debt=60%, Equity=40%, EPS=$3.18, and Stock Price=$31.20 b) Debt=80%, Equity=20%, EPS=$3.42, and Stock
Based on the information below, what is the firms optimal capital structure?
a) Debt=60%, Equity=40%, EPS=$3.18, and Stock Price=$31.20
b) Debt=80%, Equity=20%, EPS=$3.42, and Stock Price=$30.40
c) Debt=40%, Equity=60%, EPS=$2.95, and Stock Price=$26.50
I know the answer is: Debt=60%, Equity=40%, EPS=$3.18, and Stock Price=$31.20
Can someone explain why it comes to this answer?
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Creating Financial Value A Guide For Senior Executives With No Finance Background
Authors: Malcolm Allitt
1st Edition
1472922719, 978-1472922717
