Question $2$

Which of the following statements is CORRECT?

The capital structure that gives the firm the best credit rating also maximizes the stock price.

A firm's leverage affects the WACC through the cost of debt and cost of equity.

The optimal capital structure is the one that maximizes the WACC.

The amount of debt in its capital structure can under no circumstances affect a company's business risk.

A manager can affect their cost of equity by controlling the risk$-$free rate.