Click here to read the eBook: Determining the optimal Capital Structure OPTIMAL CAPITAL STRUCTURE Terrell Trucking Company is in the process of setting its target capital structure. The CFO believes that the optimal debt-to-capital ratio is somewhere between 20% and 50%, and her staff has compiled the following projections for EPS and the stock price at various debt levels: Debt/ Capital Ratio Projected EPS Projected Stock Price 20% $3.30 $32.00 30 3.55 36.50 40 3.85 35.50 50 3.55 33.75 Assuming that the firm uses only debt and common equity, what is Terrell's optimal capital structure? Round your answers to two decimal places. X 40 % debt 60 % equity At what debt-to-capital ratio is the company's WACC minimized? Round your answer to two decimal places. 40 %