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OPTIMAL CAPITAL STRUCTURE Ter ell Trucking Company is in the process o setting its target capital structure. The CFO believes that the optimal debt to
OPTIMAL CAPITAL STRUCTURE Ter ell Trucking Company is in the process o setting its target capital structure. The CFO believes that the optimal debt to capital ratio is some here between 20% and 50 and her staff has con piled the following pro ections or EPS and Debt/Capital Ratlo Projected EPS Projected Stock Price $3.25 3.60 3.70 3.55 20% 30 40 50 $33.75 35.75 36.50 33.75 Assuming that the firm uses only debt and common equity, what is Terrell's optirmal capital structure? Round your answers to two decimal places % debt % equity At what ebt-to-capital ratio is the company's WACC minimized? Round your answer to two decimal places
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