Beth is a CFO of XYZ Corporation. She wants to determine the capital structure that will result in the lowest cost of capital for her company. She has access to the following information.

• The minimum rate at which the company can borrow is the 12-month Libor rate plus a premium that varies with the debt-to-capital ratio, i.e., D/(D+E) as given in the following Table (Table 1).

Table 1

D/(D+E)	Spread (bps)
Less than 0.1	100
0.10-0.19	200
0.20-0.29	300

• The current 12-month Libor is 3 percent
• The market risk premium is 4 percent, and unleveraged beta is 0.9
• The risk-free rate is 2 percent
• The companys tax rate is 30 percent

Given the above-mentioned information, Beth constructs the following table based on the 10 percent intervals of the debt-to-capital ratio (i.e., 0.1, 0.2, etc). Please help her fill up the values in the following table. Please round to the nearest decimal points (4 decimal places) in your calculation if needed.

D is debit, E is equity, rd is cost of debt, and re is cost of equity. In the following table (Table 2), what is the value of "D" if debt-to-capital ratio is 0.1?

Table 2

D/(D+E)	Beta	rd (%)	re(%)	WACC(%)
0.1	D
0.2

Group of answer choices

none of the above

0.97

0.835

0.90

1.078