Input DataRisk-free rate 4.5%Market risk premium 5.5%Unlevered beta 0.80% 6.0% Tax rate 40.0%10% 6.5%20% 7.0%30% 8.0%40% 10.0%50% 12.5%60% 15.5%70% 18.0%Fill in formulas in the yellow cells to find the optimum capital structure.Debt/Value Equity/Value Debt/Equity A-T Cost of Levered Cost ofBeta Equity WACC0% 1.0 0.0010% 0.9 0.1120% 0.8 0.2530% 0.7 0.4340% 0.6 0.6750% 0.5 1.0060% 0.4 1.5070% 0.3 2.33WACC at optimum debt ratio =Optimum debt ratio =Mrs. Lovett's Meat Pies Inc. has consulted with investment bankers and determined the interest rate it would pay for differentcapital structures, as shown below. Data for the risk-free rate, the market risk premium, an estimate of Mrs. Lovett's unleveredbeta, and the tax rate are also shown below. Based on this information, what is the firm's optimal capital structure and what isthe weighted average cost of capital at the optimal structure?PercentFinanced withDebt (wd)Before-tax CostDebt (rd)Ratio (wd) Ratio (ws) Ratio (wd/ws) Deb

Irs. Lovett's Meat Pies Inc. has consulted with investment bankers and determined the interest rate it would pay for different capital tructures, as shown below. Data for the risk-free rate, the market risk premium, an estimate of Mrs. Lovett's unlevered beta, and the ate are also shown below. Based on this information, what is the firm's optimal capital structure and what is the weighted average co