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Now consider the use of another company: u.s. Robotics Inc. has n current capital structure of 30% debt and 70% equity. Its current beloreaxcost of

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Now consider the use of another company: u.s. Robotics Inc. has n current capital structure of 30% debt and 70% equity. Its current beloreaxcost of debt is 10%, and its tax rate is 35%. It currently has a levered beta of 1.10. The risk-free rate is 3%, and the riskpremium on the market is 7%. u.s. Robotics Inc. is considering changing its capital structure to 60% debt and 40% equity. Increasing the finns level of debt will cause its before-tax cost of debt to increase to 12%. Use the Hamada equation to unever and relever the beta for the new level of debt. What will the fim's weighted average cost of capital (WACC) be if it makes this change in its capital structure? Which of the following statements regarding a firm's optimal capital structure are true? check all that apply D The optimal capital structure minimizes the firm's cost of debt E The optimal capital structure maximizes the fims eps Cl The optimal capital structure minimizes the firm's cost of equity E3 The optimal capital structure max mizes the fim's stock price C) The optimal capital structure hinimizes the firm's wAcc

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