Review the following situation: Universal Exports Inc. is trying to identify its optimal capital structure. Universal Exports Inc. has gathered the following financial Information to help with the analysis Debt Ratio (%) 30 40 Equity Ratio (%) 70 EPS (5) 1.25 60 1.40 DPS (s) Stock Price ($) 0.55 36.25 0.60 37.75 0.65 39.50 0.75 38.75 50 50 1.60 60 40 1.85 70 30 1.75 0.70 38:25 Which capital structure shown in the preceding table is Universal Exports Incs optimal capital structure? Debt ratio 50% equity ratio - 50% Debt ratio 40%, equity ratio -60% Debt ratio - 70%, equity ratio 30% Debt ratlo - 60%; equity ratio = 40% The optimal capital structure is the one that the WACC and the firm's stock price Higher debt levels the firm's risk. Consequently, higher levels of debt cause the firm's cost of equity to