EPS and optimal debt ratio Wifiams Glasswate has estimated, at various debt ratios, the expected eamings per share and the standard deviation of the earnings per share as shown in the following table. (Click on the icon located on the top-ight comer of the dala table below in order to copy is contants into a spteadaheet.) a. Estimate the optimal debt ratio on the basis of the relationship between earnings per share and the debt ratio You will probably find it helptul to graph the relationship. b. Graph the relationship between the coefficient of vanation and the debt ratio. Label the areas associated with business risk and financial risk a. Estimate the optimal debt ratio on the basis of the relationship between earnings per share and the debt ratio: Maximum EPS appears to be at debt ratio, with per share earnings. (Select from the drop-down menus.) b. The coefficient of variation for a debt ratio of 0% is (Round to two decimal places.) The coefficient of variation for a debt ratio of 20% is (Round to two decimal places.) The coefficient of variation for a debt ratio of 40% is (Round to two decimal places.) The coefficient of variation for a debt ratio of 60% is (Round to two decimal places.) The coefficient of variation for a debt ratio of 80% is (Round to two decimal places.) Which of the two graphs below correctly depicts the debt ratio vs. the coefficient of variation? The correct graph is (Select from the drop-down menu) Graph 1 Graph 2 Debt Ratio vs. Coefficient of Variation